AMMAN — Prime Minister
Bisher Al-Khasawneh told the Lower House on Monday that Jordan
is resilient and far from being bankrupt, quoting the World Bank which affirmed
that the Kingdom is more immune than many others to the repercussions of the
Russian-Ukrainian crisis.
اضافة اعلان
While generally agreeing with Khasawneh, economists
interviewed by
Jordan News said no country in the world is immune to
bankruptcy, in light of the current difficult economic conditions, and Jordan
may one day become insolvent if the government fails to take radical measures
and solutions to revive the economy and raise revenues to be able to repay
loans and interest, especially that its indebtedness is clearly rising.
According to economist
Hussam Ayesh, a country is
declared bankrupt if it is unable to pay debts and interests on the scheduled
dates. In view of this, “and according to data, Jordan’s situation is still
good”, especially knowing that its “foreign currency balance stands at $17
billion”.
However, Ayesh said, interest that accrued from debt
in recent years is greater than aid and grants, “and this requires the
government to be able to revive the economy and manage the debt. It also must
learn how to ration its expenditures, control corruption and benefit more from
capital expenditures”.
Economist
Salameh Al-Darawi told
Jordan News that talking about a possible bankruptcy is unrealistic, “especially that
reaching bankruptcy does not happen overnight, but, rather, in several stages”.
Darawi added that bankruptcy is usually heralded by
certain indicators, like a negative trend in the economy.
Jordan, with its hard currency reserves standing a
$17 billion, enough to cover the Kingdom’s imports for more than nine months,
has “one of the safest monetary ratios in the region”.
According to Darawi, “export trends are another
indicator of the economy activity, and preliminary estimates indicate that
exports are increasing from year to year, and are expected to grow this year by
more than 6 percent, which alone constitutes approximately 30 percent of the
Kingdom’s source of hard currency”.
“In addition, there are the expatriates’
remittances, which amount to about $3.8 billion; they are important and have
been stable for years, unaffected by recent challenges and events, foremost of
which the pandemic and its negative repercussions on the global economy,” he
added.
One other important factor is the income from
tourism, which is close to $5 billion, he said, adding that “with the exception
of the closure period in 2020, tourism flows have maintained their positive
growth pace, and are steadily increasing, as the severity of the pandemic
declines”.
Darawi emphasized that “Jordan fulfilled all its
obligations, even in light of the
COVID-19 pandemic, paid all its dues ahead of
time, like the entitlement of Eurobonds, worth $1 billion, and fulfilled all
its periodic financial requirements without delay, especially with regard to
the salaries of workers in the public sector”.
“Most important is Jordan’s relationship with donors
and international institutions. The flow of aid to the Kingdom increases from
year to year, the latest of which is the
US’, which increased its aid to Jordan
for the next five years, not to mention that Jordan has strong relations with
international institutions, especially the International Monetary Fund”, he
said.
Economist
Wajdi Makhamreh agrees that Jordan is
still able to pay off all its debts and interest, “and that the economic
situation is relatively good, especially in light of the presence of a large
balance of foreign currency”.
He told
Jordan News that “the government must attract
foreign investments in order to raise revenues, since any country is vulnerable
to bankruptcy if it does not have a clear and long-term plan to pay off debts
and revive the economy”.
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