AMMAN: The World Bank will extend a soft loan of $300 million to Jordan to help it come to grips with a record budget deficit, Finance Minister Bassem Al-Salem said on Tuesday.
The minister, who spoke at the end of the final round of negotiations with a World Bank team, pointed out that his government would get the money in the fourth quarter of 2009. “The loan carries a low interest rate and will be repaid over a long period of time,” Al-Salem said.
“We decided not to go to the local market for borrowing in order to avoid competing with the private sector for credit and to make benefit from the low interest rates ruling on the world market,” he added. The Finance Ministry put the deficit for the first seven months of 2009 at an unprecedented level of 641 million dinars ($905 million), compared with 91 million dinars in the same period of 2008.
Officials attributed the rapidly growing public deficit to rising public expenditure.
