IMF approves new Jordan loan

31 January 2017

In August 2016 the IMF board approved a three-year $723 million Extended Fund Facility arrangement for Jordan, with about $72.3 million available for immediate disbursement. The loan programme was agreed in the context of what IMF staff described as the “substantial strain on Jordan’s public finance” resulting in part from the country’s Syrian refugee population. A November editorial in the Jordan Times expressed concerns that the IMF’s loan conditionalities, in particular subsidy cuts and VAT increases, seemed to be “disregarding Jordan’s commitments under various international human rights conventions”, citing expected price increases in basic goods, such as heating fuel and food, that disproportionately impact the poor. Despite these criticisms Jordan’s King Abdullah reshuffled his cabinet in January to “press ahead with unpopular IMF-mandated reforms”, according to the news agency Reuters.

From 2013 the IMF has begun researching the relationship between growth and increased female labour force participation. The Jordan loan programme is the first to draw from that research and contains explicit gendered conditionalities, specifically calling on Jordan to increase female labour force participation, including by publicly subsidised nurseries. Salma Nimms of the Jordanian National Commission for Women commented on the process that “there is no transparency by the government regarding its negotiations with the IMF and the resulting agreement. Thus, there is no public knowledge until now about the specific commitments within the agreement or how women could benefit from it.” In January, the IMF announced that the $12 billion loan programme with Egypt will also contain gendered conditionalities, including spending EGP 250 million ($13 million) to improve the availability of public nurseries to increase female labour force participation as a structural benchmark.