Fitch affirms Jordan at 'BB-'; Outlook Stable

AMMAN — Fitch Ratings has affirmed Jordan's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-' with a Stable Outlook.

This ranking is a result of the economic and financial reforms conducted by the government over the past period and the Kingdom's ability to access local and foreign finance resources and the international support that it receives in various political and economic fields, in addition to the resilience of the banking sector in the Kingdom, the Jordan News Agency, Petra, reported. 

Fitch showed that the government procedures taken in the field of tax and customs evasion will lead to enhancing local revenues and narrowing fiscal deficit this year, expecting the government's financial deficit in 2022 to reach some 3.8 per cent of the GDP compared with 4.3 per cent of the GDP in 2021.

Fitch also expected the government financial deficit to reach around 2.7 per cent in 2024. 

The agency also referred to the international support Jordan receives from other countries, mainly from the US that announced the intention to enter into a new Memorandum of Understanding (MoU) on assistance to Jordan, with a commitment to provide a minimum $1.45 billion per year in economic and military assistance grants between 2023 and 2029, an extension and augmentation of the previous MoU.

Jordan has largely been shielded from the fallout of the Russia-Ukraine war due to long-term gas supply agreements, large strategic wheat reserves, soaring fertiliser exports and a strong recovery of its tourism sector.

Finance Minister Mohamad Al-Ississ said that maintaining the ranking in light of the unstable economic circumstances in the world is a main indicator of the efficiency of reforms implemented by the government to preserve financial and monetary stability, which positively reflects on credit ratings and the confidence of investors and international institutions.  

Al-Ississ said that the government will utilise this ranking to support efforts to preserve fiscal stability in Jordan through reducing general debt and resuming growth momentum that will contribute to creating jobs, mainly among the youth.