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Moody’s upgrades Jordan’s credit rating to Ba3 with stable outlook

By Maria Weldali - May 10,2024 - Last updated at May 10,2024

AMMAN — Sovereign credit rating agency Moody’s Ratings upgraded the Kingdom’s long-term local and foreign currency issuer ratings to Ba3 from B1, affirming the country’s efficient and competent fiscal and monetary policies, announced Minister of Finance Mohammad Al-Ississ on Thursday.

During a press briefing at the ministry’s headquarters, Al-Ississ emphasised that the upgrade is a testament to the stability and resilience of the Jordanian economy, reflecting the robustness of its fiscal policies and the success of its structural economic reforms.

The minister also said, “This is the first sovereign credit upgrade for Jordan in 21 years. It is an international acknowledgement of Jordan’s ambitious reform agenda, which has significantly boosted our economic growth.”

Al-Ississ further noted that this upgrade comes at a challenging time when many countries worldwide are either maintaining their levels or facing downgrades. “Despite these circumstances, Jordan has managed to enhance its creditworthiness with this upgrade,” he added.

The minister also reiterated that Jordan’s fiscal policy, guided by His Majesty King Abdullah, aims to mitigate the ongoing aggression on Palestinians, noting that the upgrade reflects the government’s ongoing reforms to protect the middle class from global and regional economic challenges.

A statement from the ministry to The Jordan Times said, “The upgrade showcases the consistent record of effective macroeconomic and fiscal management and risk mitigation measures, adding that Moody’s Ratings expects these measures to continue providing a credible buffer against shocks.” 

The statement also highlighted how Jordan’s proactive policies have safeguarded its credit profile amidst the COVID-19 pandemic, the Russian-Ukrainian war, global monetary tightening, regional geopolitical tensions and the Israeli war on Gaza.

Governor of the Central Bank of Jordan (CBJ) Adel Sharkas said, “The upgrade of Jordan’s credit rating under the current circumstances is a prestigious endorsement from a reputable international institution, testifying to Jordan’s economic resilience to shocks and turbulences.”

The governor also emphasised that the rating reflects the strength of Jordan’s macroeconomic fundamentals, stressing that the monetary policy adopted by the Central Bank, in line with international and regional policies, has played a crucial role in maintaining monetary and financial stability in the Kingdom.

Sharkas also pointed out that this stability is further bolstered by a record level of foreign reserves amounting to $19.0 billion and a robust and stable financial structure of the banking sector.

Moody’s Ratings projects that Jordan’s fiscal and debt trajectories will remain “stable,” expecting the general government deficit to average 1.5-2 per cent of GDP during 2024-2025, compared with 2.1 per cent in 2023 and 2 per cent in 2022.

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