Economic Assistance Package for Jordan

December 2, 1999

On December 2, 1999, Prime Minister Obuchi announced to His Majesty King Abdullah II of Jordan in the summit meeting, a comprehensive "Economic Assistance Package" for Jordan which amounts to approximately 400 million US dollars for three years starting from this year until 2001 to alleviate Jordan's debt burden, recognizing the necessity of stabilizing Jordan's economy that faces chronic deficits of the balance of international payments as well as the issues of its external debt, and evaluating the economic reform efforts that the Jordanian Government has undertaken in consultation with the IMF and other international financial institutions.
His Majesty King Abdullah expressed his deep appreciation for the economic cooperation which Japan has already extended for Jordan and also expressed his sincere gratitude for the "Economic Assistance Package."

The main contents of the Assistance Package are as follows:

(1)	Assistance for Balance of International Payments including Debt Relief Japan decided to implement "The Fifth Rescheduling (amounting to approximately 125 million US dollars)" including the reduction of rescheduling interest rate for ODA loans from 3.9% to 2.2%. Signing of the Exchange of Note was made today between Mr. Mikio Aoki, Chief Cabinet Secretary of Japan in his capacity as acting Minister for Foreign Affairs and Dr. Rima Khalaf Hunaidi, Deputy Prime Minister, Minister of Planning of Jordan. Japan has provided non-project grant aid to support Jordan's efforts for its economic structural reform. Japan will, if necessary, look into the possibility of additional support of this kind.
(2)	Support for Self-sustained Development of Jordan's Economy Japan will continue to promote technical cooperation under "Industrial Development Policy Advice Project" which is aimed at planning and formulating industrial policies required for a self-sustained development of Jordan's competitiveness of the industries. In order to secure the effectiveness of this policy advice, Japan will start development study on "Strengthening of Enterprise Management Capability", and secure funds necessary to implement those policies by utilizing the counterpart fund of non-project grant aid. In addition, given the importance of promoting tourism industry which is urgently needed as one of the valuable means of earning foreign currency in Jordan, the Loan Agreement for "Tourism Sector Development Project (about 70 million US dollars)" was signed also on December 2, between the Japan Bank for International Cooperation and the Jordanian Government.
(3)	Cooperation for Social Development In order to ensure that economic development is accompanied by the improvement of the people's life, Japan will continue its assistance to social development. For this purpose, and to support the background of Middle East peace process, Japan has been implementing grant aid for the Project for the Improvement of Water Supply System to Great Amman (Phase II), which would ensure the effective utilization of the water that has been made available as a result of the Jordan-Israel Peace Treaty. Japan also mapped out its course to construct King Hussein Bridge, which is the major gateway to the West Bank. In addition, Japan decided to extend food assistance (approximately 570,000 US dollars) through World Food Program to assist Jordan to cope with the serious damage its agriculture received due to this year's severe drought.

The two sides agreed to continue close exchange of views with participation of the representatives of the both countries in the various fields in order to discuss the overall bilateral relations including political, economy, social, cultural and economic cooperation. For this purpose they agreed to establish "Japan-Jordan Consultation Forum" to be convened on regular basis. "The JETRO Forum on investment and tourism" is the beginning of an effort to establish this Consultation Forum.

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