Germany offers cash-strapped Jordan $100 million loan

Germany has promised $100 million in loans to Jordan, which is looking at ways at shoring up cash after the government was forced to cancel austerity measures following popular protests this month.

German Chancellor Angela Merkel met Jordan's King Abdullah II in Amman on Thursday, with both leaders facing domestic problems.

Jordan saw large protests in the capital and elsewhere this month against plans to introduce a new income tax and to lift fuel subsidies.

The prime minister and government were replaced with the planned austerity measures repealed.

Since then, King Abdullah has been looking at new sources of funding to help the cash-strapped country.

Kuwait, Saudi Arabia and the UAE offered $2.5 billion in aid to the kingdom, while Qatar has said it will provide $500 million with the promise of 10,000 jobs for Jordanians inside the emirate.

Now Merkel has offered a $100 million loan to the king, along with $442 million in bilateral aid pledged for this year.

She said that she hoped the money will help Jordan push through painful IMF reforms to lower its debt which currently stands at 96 percent of the country's GDP.

"We are aware of the challenges you face, both in the realm of security and in civil society development," Merkel said, adding that she wished the government success in implementing "needed reforms."

"The IMF, and it's known for this, often has very ambitious ideas about reforms, and implementing them is anything but simple," she said.

Jordan has been hit hard by the war in Syria, which has forced it to close its borders to one of the kingdom's main training partners.

Low oil prices, nationalisation and austerity measures in the Gulf have contributed to force Jordanians back home.

Merkel has meanwhile faced criticism over her relaxed immigration policy with her coalition partner saying many migrants - many of whom are from Syria and Iraq - should be turned back at Germany's border.

"I am on the side of those, and this is fortunately the majority in Germany, who say we need to be an open country," she said, adding that "of course we need to regulate this".