IMF Approves $2 Bn Loan for Jordan

The International Monetary Fund on Friday issued a $2 billion loan for Jordan to steady the country's battered economy and protect it from external "shocks" in the region.

The IMF executive board approved the three-year loan, making $385.35 million immediately available, the fund said in a statement.

The remaining amount will be phased in, subject to quarterly reviews of the economy's performance under the so-called Stand-By Arrangement.

The IMF noted that the loan, requested by the Jordanian authorities, represents "exceptional access" to the fund's resources, amounting to 800 percent of Jordan's financial commitment to the institution.

Flanked by a circle of instability, Jordan has been ravaged by spluttering natural gas supplies from revolutionary Egypt and a flood of refugees crossing the border from war-torn Syria.

In addition, large financing needs to protect consumers from the increase in energy prices in 2011 were further deepened in 2012 by the need to provide housing and medical services to refugees from Syria.

"The Jordanian authorities have developed an economic program focused on achieving fiscal and external sustainability in a socially acceptable manner, while strengthening growth prospects," IMF managing director Christine Lagarde said in the statement.

"The program envisages supporting confidence as well as strong medium-term consolidation in the fiscal and energy sectors."

The IMF said that Jordanian authorities intend to cut the country's deficit by about six percent of gross domestic product during the program.

The energy-poor country has expressed concerns that cuts in natural gas supplies from Egypt could cost the kingdom more than $2 billion dollars in 2012.

More than 276,000 Syrians have fled their country, mainly to Jordan, Turkey and Lebanon, according to the U.N. refugee agency UNHCR.

Jordan currently is hosting more than 140,000 Syrians, and is building more camps to house the refugees.

The conflict in Syria has killed more than 20,000 people since the uprising against the regime of President Bashar al-Assad erupted in March 2011, the Syrian Observatory for Human Rights says.