Jordan Times
Thursday, May 27, 1999
House Finance Committee approves three-year extension of IMF programme
AMMAN (J.T.) — The Lower House of Parliament's Finance and Economic Committee approved the government's three-year extension of the International Monetary Fund economic reform programme, Ali Abul Ragheb, the committee's chairman announced on Wednesday.
Speaking after a meeting with the government's economic team to review the extension and its impact on Jordan's economy, Abul Ragheb said the programme is bound to help reform the national economy, improve the Kingdom's financial status, reduce the budget deficit and make Jordan eligible for further loans and grants to boost economic growth.
The new three-year IMF reform scheme includes extra loans to Jordan as part of a package that sets a target growth rate of 3.5 per cent by the year 2001. It also entails introducing and enforcing higher sales tax rates, more effective income tax collection procedures and lower customs tariffs.
Under the new deal, Jordan pledges to lower the ceiling of customs tariffs from 40 to 30 per cent by the year 2000 and hike the sales tax to l2 per cent by the coming month. In return Jordan will earn a credit facility of about $3 billion over a span of three years.
The extension programme had been called for by Western donor nations as a prerequisite for debt alleviation for Jordan, official source stated.
The government's economic team, who met the committee to review the l999-200l extension plan, included Deputy Prime Minister Rima Khalaf, Minister of Finance Michel Marto and Governor of the Central Bank of Jordan Ziad Fariz.
Abul Ragheb said the committee supports the government's endeavours to solve the Kingdom's social, political and economic problems, stressing that the government needs support for its efforts at all levels and from all sectors.
He said the committee, which will refer its decision to the full House later on, believes that the extension programme is harmonious with administrative reform and will recommend that the House approve the plan.
The economic team answered all queries connected with the extension plan during the meeting, Abul Ragheb said.
Committee Rapporteur Munir Sobar said the committee will hold another meeting with the government team in the presence of the prime minister on Thursday.