CBJ hikes interest rates, expands soft funding for entrepreneurs

AMMAN — The Central Bank of Jordan (CBJ) on Sunday increased the interest rate on all monetary policy instruments by 25 basis points, effective from Monday.

The bank said the decision was taken in line with interest rate changes in international and regional markets. The move, a CBJ statement said, also came in harmony with the bank’s policy guidelines aimed at enhancing monetary and banking stability, in addition to ensuring a stronger competitiveness of financial instruments. 

However, the CBJ, in a customary decision, decided to maintain, as is, interest rates for entrepreneurs who borrow under a programme to boost the economy through financing SMEs in a set of designated sectors. The current interest rate level is 1.75 per cent for projects in Amman and 1 per cent for those started in governorates. 

The bank also decided to expand the project to include the health sector, transportation (transport companies) and education (technical and vocational training).  Other sectors that the programme currently includes are industry, tourism, agriculture, renewable energy, information technology and engineering consultancy. The decision to expand the project is aimed at contributing to national efforts to train and improve manpower in order to compete at the level demanded by local and international markets said, the Jordan News Agency, Petra.

Through this programme, CBJ has financed 839 projects that roughly cost JD565 million out of the available loan of JD1.1 billion. These projects have created more than 8,400 new job opportunities in various domains in the Kingdom, according to Petra. 

The CBJ said that it would continue close follow-ups on local and international economic developments and take proper procedures that guarantee enhanced monetary and financial stability in the Kingdom.

The announced in March its decision to increase interest rates on various monetary policy instruments by 25 basis points, according to a CBJ statement said.