Jordan's Foreign Grants More Than Double in First Seven Months of the Year

Foreign grants to help Jordan finance government spending more than doubled in the first seven months of this year, the government said.

Jordan received 208 million dinars ($294 million) in grants through July, compared with 103 million dinars in the same period in 2009, the Ministry of Finance said in a preliminary report on its website.

The kingdom’s budget deficit narrowed to 281 million dinars in the first seven months after receipt of the grants and a reduction in government spending, compared with a shortfall of 641 million dinars in the same period in 2009. Jordan, which imports more than 90 percent of its oil, typically relies on foreign investment and grants to finance deficits in the budget and in the current account.

The projected budget deficit for this year after grants is 1 billion dinars, or 6 percent of gross domestic product.

Grants fell 54 percent to 333.4 million dinars last year, according to a report by the Finance Ministry on Feb. 28. The 2009 budget deficit widened to 1.44 billion dinars, from 692.7 million the previous year, excluding non-recurring revenue from the sale of land in 2008.

Foreign debt increased by 1.6 percent to 3.93 billion dinars in the first seven months, the Finance Ministry said. Domestic debt increased 10.6 percent to 6.4 billion dinars.

To contact the reporter on this story: Massoud A. Derhally in Beirut, Lebanon, at mderhally@bloomberg.net.

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