Jordan — IMF Staff Reach Staff Level Agreement on the Third Review under the Extended Fund Facility and Make Progress Toward a Program Supported under the Resilience and Sustainability Facility

IMF News, April 17, 2025

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Canonical URL: Jordan — IMF Staff Reach Staff Level Agreement on the Third Review under the Extended Fund Facility and Make Progress Toward a Program Supported under the Resilience and Sustainability Facility

IMF staff and the Jordanian authorities reached a staff‑level agreement on the third review of the authorities’ economic reform program supported by the EFF arrangement.
All quantitative performance criteria for the third review were met.
The agreement is subject to approval by the IMF’s management and the Executive Board.
Completion of the review will make SDR 97.784 million (about US$130 million) available, out of the approved program size of SDR 926.370 million (about US$1.2 billion).
The EFF arrangement was approved by the IMF’s Executive Board on January 10, 2024.

2024 outcomes and influences:
- Growth in 2024 reached 2.5 percent.
- Inflation in 2024 remained low, at less than 2 percent.
- The current account deficit widened to 5.9 percent of GDP in 2024, in part reflecting lower tourism receipts.
- The budget deficit target for 2024 was met, as strong measures offset revenue losses from lower domestic demand and lower prices of key export commodities.
Outlook and projections:
- Growth is projected to reach 2.7 percent in 2025.
- The current account deficit is expected to be contained at 5.5 percent of GDP in 2025.
- Inflation in 2025 is expected to remain low, at just over 2 percent.
- Barring additional shocks, growth is expected to pick up pace further in the coming years, to over 3 percent, fueled by several large investment projects, including the Aqaba Amman Conveyor project, and by deeper regional economic integration with Syria, Lebanon, and Iraq.
Drivers and risks:
- Recovery in domestic demand and tourism, and increased investment inflows, underpin the 2025 growth projection.
- Considerable external headwinds include spillovers from the conflicts in Gaza and Lebanon, higher trade tensions, and continued conflicts in the region.
- Higher imports and possible adverse effects on exports from higher trade barriers pose risks to the current account.

The Central Bank of Jordan (CBJ) continues to safeguard monetary stability and maintain the peg to the U.S. dollar.
The CBJ remains firmly committed to the exchange rate peg, which is supported by strong international reserves.
The banking sector demonstrates resilience, with strong capitalization and sound financial health.

Fiscal anchor and goals:
- Authorities remain committed to the fiscal policy anchor of placing public debt on a steady downward path while protecting priority social and development spending.
- Steady fiscal consolidation will continue in 2025–28, aiming to bring public debt to 80 percent of GDP by 2028.
Policy measures:
- Continued efforts to mobilize revenues, improve spending efficiency, and ensure the financial viability and efficiency of public utilities and the Social Security Corporation (SSC).

Authorities are determined to step up structural reforms to achieve stronger growth and generate more jobs.
Reform focus areas:
- Improving the business environment to attract more investment by enhancing competition and labor market flexibility.
- Further strengthening the social safety net.
- Streamlining regulation and digitalization of government services, including tax and customs administration.
Social challenge:
- Unemployment remains high, particularly among the youth and women (no numeric value provided in source).

Substantial progress was made toward agreement on an arrangement under the Resilience and Sustainability Facility to address long‑term vulnerabilities.
Areas targeted by the RSF discussions:
- Water and electricity sectors.
- Enhancing Jordan’s ability to address health emergencies, including future pandemics.
Discussions are expected to continue with the aim to reach agreement soon and to be concluded in Washington DC.

Mission dates: April 6–17, 2025.
Mission leader: Ron van Rooden.
The staff team met with: Prime Minister Hassan; Minister of Finance Shibli; Minister of Planning and International Cooperation Toukan; Minister of Economic Affairs Shehadeh; Governor of the Central Bank of Jordan Al‑Sharkas; and other Ministers and senior government and CBJ officials.

IMF Staff statement released April 17, 2025.