Gulf states offer $2.5 billion to bail out cash-strapped Jordan

Postado Junho 13, 2018

Custodian of the Two Holy Mosques King Salman, Jordan's King Abdullah, Kuwait Emir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, Ruler of Dubai, UAE Vice President and Prime Minister Sheik Mohammed Bin Rashid Al Makhtoum watch from the window of Al-Safa Palace in Makkah millions of Umrah pilgrims and visitors thronging the Grand Mosque on Sunday night.

Saudi Arabia, the UAE and Kuwait have offered $2.5bn in aid for Jordan to ease its economic crisis following anti-austerity protests in the country.

The package of aid will include a deposit in the Central Bank of Jordan, guarantees to the World Bank on Jordan and annual support for the budget of the Jordanian government for five years, according to a statement posted on the state-run Saudi Press Agency website.

Austerity measures tied to the International Monetary Fund loan have seen prices of basic necessities rise across the kingdom - culminating in a week of angry protests over tax proposals that forced prime minister Hani Mulki to resign.

The financing of highways, hospitals and ageing infrastructure by Saudi Arabia, Kuwait and the United Arab Emirates had indirectly relieved pressure on the kingdom by reducing the need for large capital spending, another official said.

Jordanian Prime Minister Hani Mulki was forced to resign as a result of protests, with King Abdullah II appointing Education Minister Omar al-Razzaz to form a new government.

European Union foreign policy chief Federica Mogherini on Sunday announced Sunday 20 million euros ($23.5 million) in aid for Jordan.

The three wealthy Gulf states said Jordan would receive as much as $2.5 billion of aid to help it weather the economic and political crisis.

While peaceful, the protests threaten the stability of a kingdom strained by hosting those who fled the wars in Iraq and Syria.

Gulf states, except for Bahrain, largely avoided the pro-democracy protests unleashed by the Arab Spring, but they have sought to deepen economic links in the region following an oil price slump in 2014.

The World Bank says Jordan has "weak growth prospects" this year, while 18.5 percent of the working age population is unemployed.