Saudi Grants $1 billion to Jordan

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Place:Saudi Arabia

Story:Jordan receives $1billion grant from Saudi

Objective: To help reduce Jordan’s budget deficit

Jordan, like other countries in the region, has seen a number of demonstrations across the country against high commodity prices and government policies. This caused an increase in the budget deficit over the past years.

Jordan’sbudgetdeficitduringthefirstfivemonthsof2011droppedby 64percentafterforeignassistancecompared tothesame periodin 2010,thestate-runPetra Newsagencyreportedlast week.

Thebudgetdeficitreached46.2millionJordaniandinars(about US$65million) taking foreignassistanceinto accountduringthe January-Mayperiodcompared to128.8milliondinars( $181.6million) duringthesameperiodlast year, officialfiguresbythe MinistryofFinance showed.

Thecountry’sbudgetdeficitbeforeforeignassistancereached361milliondinars(509million dollars)duringtheJanuary-Mayperiod comparedto 257milliondinars (362milliondollars) inthe sameperiodlastyear,accordingtothefigures.

To help counter this deficit, Saudi Arabia had granted $400 million to Jordan last month. Adding to this, the Saudi government yet again helped with another grant, to help reduce the deficit.

Grant of $1 billion –

Saudi Arabia has granted Jordan$1 billion to help reduce its budget deficit, Jordanian newspaper, Al Arab Al Yawm, reported Tuesday.

The new grant brings Saudi Arabia’s total financial support to Jordan to $1.4 billion. Last month Jordan received a $400 million grant from Saudi Arabia to support its budget.

The paper also said that Saudi Arabia would render more support to Jordan through supplying the kingdom with Saudi crude oil at discounted prices. The paper didn’t elaborate.

Jordan’s King Abdullah II praised Saudi Arabia’s King Abdullah for the grant. “Saudi Arabia stands by Jordan at a time of difficult global economic conditions and a sharp increase in fuel prices,” the Jordanian monarch said in a letter he sent to the Saudi King. “Your generous and brotherly gestures is a back up for us all,” the official Petra News agency quoted the King saying.

Abdullah has supported political reform toward majority parliamentary government and has instructed an ad-hoc panel to amend the constitution accordingly.

The new Saudi grant came one week before Jordan was due to start talks with the Gulf Cooperation Council (GCC) states on terms under which the Hashemite Kingdom would be admitted to the Arab bloc.

Jordanian Foreign Minister Nasser Judeh is to fly to Saudi Arabia next week for talks with his six GCC counterparts to lay down the framework for Jordans membership in the GCC, which was founded in 1981 as an economic partnership.

Saudi Arabia has reportedly proposed Jordans admission following the uprisings in Tunisia and Egypt as a pragmatic way to support the king.

Overview-

Jordan’s King Abdullah II has said that this Saudi financial support to Jordan would foster “real ties of solidarity and integration” between the two monarchies which have emerged safe so far from the turmoil of the Arab Spring.

Solidarity between nations is a better way forward, and this stands to greatly improve the relations between these countries.

Sources: Zawya, saudigazette, Chinadaily

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