S&P maintains stable outlook for Jordan

AMMAN — International credit rating agency Standard and Poor’s (S&P) has affirmed Jordan’s B+/B sovereign credit rating, maintaining a stable outlook despite global downgrades to both regional and global countries.

According to a Finance Ministry statement on Tuesday, cited by the Jordan News Agency, Petra, S&P said that despite the impairing effect of the pandemic on Jordan’s important sectors, such as tourism, the government’s economic containment measures contributed to maintaining financial and monetary stability.

These measures played a role in avoiding negative repercussions through restraining economic contraction by 1.6 per cent, “which exceeded expectations”.

The agency expects a gradual economic recovery in 2021-2024, noting that the economic policy's reliance on “an ambitious list” of structural reforms, implemented under the government programme with the International Monetary Fund (IMF), will contribute to restoring the growth momentum that leads to job creation. 

These reforms include fighting tax and customs evasion, improving government transparency, and reducing the cost of doing business.

The effects of this economic recovery gradually began to surface as tax revenues for the first five months of 2021 increased by 30 per cent compared with the same period of 2020, the agency said.

The number of arrivals from abroad in May and June of this year was about 40 per cent of the number of arrivals in the pre-pandemic period, compared with an average of 9 per cent in the second half of 2020, the S&P added.

Also, the S&P expects debt levels as a percentage of GDP to decline over time, despite currently standing at high levels due to the pandemic and other pressures.

It is the fourth time that the S&P maintains the credit rating of the Kingdom since the outbreak of the pandemic despite the fact that the agency has lowered the rating of several countries with larger economies than Jordan’s, which positively reflects on the confidence of international institutions and the international community in the resilience of the Jordanian economy and its ability to recover, according to Petra.