Soft loans for Jordan and Lebanon have been approved

The World Bank has taken definite steps to extend soft (i.e. low-interest) loans to Jordan and Lebanon, in order to bolster the economies of the two countries, which are under heavy pressure from the influx of 1.7 million Syrian refugees. ‘Lebanon and Jordan are both regarded as middle-income countries. Normally, they wouldn’t be eligible for these kinds of loans,’ said Minister for Foreign Trade and Development Cooperation Lilianne Ploumen, speaking at the spring meeting of the World Bank in Washington, DC. ‘But the impact of the war in Syria has been enormous. This is why it’s so important to lend our support to these countries and to get started with it right away.’

Since last autumn the Netherlands has been pressing for greater support for Lebanon and Jordan in broad terms. ‘If you’re putting an emphasis on “reception in the region”, you have to offer extra assistance to both refugees and host countries – in humanitarian and economic terms,’ said Ms Ploumen. With this in mind she was among the first to support a stronger role for the World Bank. At the Syria conference in February, the Netherlands was a pioneer in this respect, pledging €10 million.

At the spring meeting other countries and institutions, such as the US, the UK, Germany, Canada, Japan and the EU, have made pledges of their own. Taken together, these pledges form a large package of soft loans and guarantees of over one billion euros. ‘This money will structurally reinforce the economies of Jordan and Lebanon, creating more jobs, for both the local populations and refugees,’ said the minister. ‘The latter is extremely important. The vast majority of Syrians want to stay close to home. But for that to happen, they need to have prospects for the future. Work and educational opportunities are crucial in this regard.’

Officially, the new fund, which is a cooperative venture of the World Bank and the Islamic Development Bank, will be called the Concessional Finance Facility (CFF). For now the soft loans will only be available to Lebanon and Jordan, because these are the countries that have been most affected by the war in Syria. The first loans are expected to be made before the end of this year.