The United States today re-affirmed its strong commitment to the people of Jordan by signing a second sovereign loan guarantee agreement with the Hashemite Kingdom of Jordan.
The United States’ loan guarantee will allow Jordan to access affordable financing from international capital markets, ensuring that Jordan can continue to provide critical services to its citizens as it enacts transformative economic reforms and hosts 600,000 refugees who have fled the violence inside Syria. The loan guarantee agreement is designed to support specific economic reforms the Government of Jordan is pursuing to promote the economic stability and growth needed to provide opportunity and prosperity to the Jordanian people.
The signing of this loan guarantee agreement fulfills the commitment made by President Obama during his meeting with King Abdullah in California on February 14, 2014. At that meeting President Obama noted that, “we have very few friends, partners and allies around the world that have been as steadfast and reliable as His Majesty King Abdullah, as well as the people of Jordan.”
This will be the second U.S. loan guarantee to the Government of Jordan. Pursuant to the loan guarantee agreement, the United States would guarantee repayment of principal and interest on the issuance of up to a $1 billion, five-year Jordanian sovereign bond. This follows the U.S. guarantee for a $1.25 billion issuance last year. Last year’s guarantee was very successful in reducing Jordan’s borrowing costs, and supporting its reform efforts during a time of regional instability.
The Administration has the goal of providing the guarantee in June. Final terms, pricing, and the face amount of the bond are determined shortly before the financial closing.