The Jordanian government has borrowed $100 million from the Jordan Islamic Bank, following the successful performance of Islamic banking during the latest global financial crisis.
Mohammad Abu Hamour, the Jordanian finance minister, signed the loan agreement on behalf of the government on Monday.
He said that the credit would be used for buying wheat and barley to enhance the country's strategic stockpile of the two basic commodities.
"Our decision to turn to Islamic banks for borrowing came in the light of the success scored by Islamic banking during the world financial crisis," the minister said.
Abu Hammour said that his ministry had set up panels for appraising the feasibility of borrowing through the issuance of Islamic bonds, the sukuk.
The minister added his ministry had come up with a plan to handle the record deficit in Jordan's public budget which was expected to reach 1.5 billion dollars in fiscal 2010.
According to regional and international studies, Islamic banks were the least affected by the crisis that rocked the world economy in the last quarter of 2008 - compared with big losses incurred by conventional banks.
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Hmmm.. I wonder why the islamic banks were not affected
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