The European Commission and the Government of Jordan have signed a Memorandum of Understanding to initiate the implementation of €500 million in Macro-Financial Assistance (MFA) for Jordan. This initiative is part of a broader Strategic and Comprehensive Partnership between the European Union and Jordan, which was adopted earlier this year. The partnership aims to strengthen collaborative efforts in supporting economic stability, growth, long-term resilience, and comprehensive reforms in Jordan.
In response to Jordan’s request for macro-financial assistance in October 2023, prompted by a deterioration in its economic condition due to increased regional instability following the conflict in neighbouring Israel and Gaza, the European Commission proposed, on 8 April 2024, a new MFA operation totalling up to €500 million. This proposal received approval from both the European Parliament and the Council in April 2025.
The Memorandum of Understanding, signed on 25 August by Valdis Dombrovskis, Commissioner for Economy and Productivity, Implementation and Simplification, on behalf of the European Union, formalises the fourth MFA, which the European Parliament and the Council also endorsed. The arrangement allows for the disbursement of €500 million over a period of up to two and a half years, contingent upon progress with the agreed reform agenda and policy measures detailed in the Memorandum. This financial assistance will enable Jordan to address part of its external financing needs and facilitate its economic reforms.
“I welcome the agreement with the Jordanian authorities on the policy conditionality underpinning our fourth macro-financial assistance worth up to EUR 500 million, which aims to strengthen the Jordanian economy and facilitate reform agenda in key areas such as public finances and labour markets. This will unlock the disbursements of the funds which, in turn, will address Jordan’s balance of payments challenges and support economic stabilisation,” Commissioner Dombrovskis said.
The reforms outlined in this agreement aim to strengthen key sectors of the Jordanian economy, including public finance management, governance, anti-corruption initiatives, social protection, labour market policies, the green transition, and improvements to the business environment. A positive evaluation and subsequent decisions regarding the disbursement of funds will require ongoing adherence to specified political preconditions.
Furthermore, this initiative precedes a recent proposal from the European Commission for a fifth MFA, which would provide an additional loan of up to €500 million. This proposal is subject to approval by both the European Parliament and the Council and is designed to complement the reform agenda associated with the fourth MFA. Together, these efforts would increase the total EU support under macro-financial assistance to €1 billion.
The disbursement of the first instalment is anticipated within one month following the signing of the Memorandum. This is contingent upon a positive assessment by the European External Action Service regarding the fulfilment of political preconditions, as well as a satisfactory performance in the ongoing International Monetary Fund (IMF) program. The disbursement of subsequent instalments will depend on the timely and effective implementation of the agreed-upon policy measures.
The European Commission and the European External Action Service (EEAS) will continue to closely monitor the situation, coordinating with international partners. The policy conditions outlined in this Memorandum are aligned with the reform agenda of the Jordanian authorities and support Jordan’s commitments under its partnership with the European Union.
