delete PART 235—HASHEMITE KINGDOM OF JORDAN LOAN GUARANTEES ISSUED UNDER THE FURTHER CONTINUING APPROPRIATIONS ACT, 2014, DIV. F, PUB. L. 113-6—STANDARD TERMS AND CONDITIONS
This regulation outlines procedures and terms for USAID loan guarantees backing up to $1 billion in debt issued by the Hashemite Kingdom of Jordan. It guarantees 100% of principal and interest to private noteholders, using the full faith and credit of the United States, with detailed claims procedures, eligibility requirements, and arbitration provisions.
This represents a $1 billion contingent liability of U.S. taxpayers to subsidize foreign borrowing by Jordan. Private lenders are perfectly capable of assessing Jordan's credit risk and pricing loans accordingly without U.S. government guarantees. The guarantee distorts international capital markets, creates moral hazard by removing market discipline on Jordan's borrowing, and transfers risk from willing private investors to American taxpayers. The detailed bureaucratic machinery for processing claims demonstrates unnecessary federal expansion into activities that properly belong to private finance. If Jordan cannot obtain affordable financing on market terms, that reflects legitimate credit concerns—not a market failure requiring government intervention. Foreign aid, if Congress desires it, should be transparent direct appropriations, not disguised as loan guarantees that obscure true costs and expose taxpayers to potential losses.