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French agency lends Jordan 132m euros

By Mohammad Ghazal - Nov 30,2016 - Last updated at Nov 30,2016

AMMAN — Jordan on Wednesday signed two soft loan agreements totalling 132 million euros with the French Development Agency to support the state budget and the water sector.

The first 100 million euros soft loan will support the municipalities’ financial sector, Minister of Planning and International Cooperation Imad Fakhoury said Wednesday at the signing of the loan agreements.

The interest rate on the loan is around 1.5 per cent, according to the minister.

The first sector policy loan came in response to Jordan’s request to the agency to help it improve the financial and technical performance of the country’s municipalities, the minister said.

The loan will be extended over two trenches. The first 50 million euros will be transferred to Jordan before the end of this year, while the remaining 50 million euros will be disbursed in 2017.

Fakhoury said the second loan of 32 million euros will finance projects to improve access to water and enhance the performance of the water distribution and sewage systems in Irbid.

The finance for this water project is also in response to Jordan’s call to help in dealing with the consequences of the Syrian crisis, and is part of pledges made to Jordan at the London conference of donor countries early 2016.

The minister noted that the EU has provided 40 million euros in grants to finance the water project that costs 144 million euros.

Meanwhile, a financing agreement will be signed early 2017 with the German Development Bank to complete finance for the water project.

The project aims to expand, rehabilitate and improve the performance of the water networks in Irbid and Ramtha and to link areas that are currently not connected to the sewage network.

It will also help improve water supply to communities affected by the influx of Syrian refugees through conducting maintenance for water networks and enhancing the water supply.

Jordan is home to some 1.4 million Syrians, according to official figures. Even before the crisis, Jordan was among the poorest countries in water worldwide.

Speaking to the Jordan News Agency, Petra, on the sidelines of the signing ceremony, Fakhoury said only 38 per cent of the funds required for the Jordan Response Plan to the Syrian refugee crisis have been secured so far, expecting the ratio to rise to 45 per cent by next February — which marks one year after the London donor conference.

The minister said this ratio is better than last year’s, where funds only covered 36 per cent of the response plan.

Noting that donors had announced that they had funded 55 per cent of the plan, Fakhoury said the government only calculates funding that has been signed and agreed on.

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