Jordan is taking serious steps toward economic reform, green growth, says EBRD official

[23-09-2021 10:41 AM]

Ammon News - A senior official at the European Bank for Reconstruction and Development (EBRD) said the EBRD started to provide Jordan with an emergency package as early as spring last year to mitigate COVID pandemic impacts on the national economy.

Managing Director for the Southern and Eastern Mediterranean (SEMED) region at the EBRD, Heike Harmgart, told the Jordan News Agency (Petra) that the EBRD will continue helping Jordan's private sector to be more flexible in terms of restructuring the loans to give it more time to pay back.

"We have started a vital infrastructure support facility, which is also a COVID response facility for infrastructure, such as extending some emergency funding for the National Electric Power Company (NEPCO) to maintain its working capital. We also continue to look at what we can do to help the greater Amman municipality, to help the transport sector through the crisis," Harmgart said.

Harmgart, who is currently visiting Amman, accompanied by an EBRD team, said the visit focuses on supporting Jordan's economic recovery efforts and working with different sectors of the Jordanian economy to come out of the crisis.

"We're talking to local banks to help them with green financing for small and medium enterprises," Harmgart added. "We're talking, to the Greater Amman Municipality, NEPCO, to the energy sector to see what we can do on the infrastructure to support more green investments, including desalination, energy efficiency, solar and wind energy."

"We also stand ready to support many dimensions for Jordan, including the green economy and women’s empowerment, which were focused on during the work team’s meetings with some Jordanian banks recently," Harmgart noted.

She explained that the real focus of this visit is on helping Jordan become more energy efficient through investing in the green economy, which is a "is a win-win deal", especially in reducing production costs on companies, helping the state to provide water and electricity, and also ensuring that citizens have access to affordable electricity through solar, wind and water technology.

She added that the EBRD works in partnership with the public and private sectors; the private sector accounts for about 75% of the bank’s business, while the public sector’s share of the bank’s plan is limited to about 25% with the government.

She explained that the EBRD is working on several projects with the Greater Amman Municipality, including waste management, energy, urban transport, electric buses, green lighting to help it become more energy efficient.

"One area that we also believe is really an opportunity for Jordan is supporting female entrepreneurs. We are working with Jordanian banks to support female entrepreneurs and businesses," the EBRD official added. "Another area which we also touched upon this visit is digitalization by supporting their FinTech projects, including e-payments, e-wallets, etc. So that's also an area where we will, throughout this year, do more projects and financial technology."

Regarding business-doing in Jordan, Harmgart said that one of the key improvements was around reforming the banking sector regulation to make sure access credit becomes easier and the serious attempts to attract investment, which ensures easing conditions for new companies and new investors to register and obtain licenses.

In the energy sector, Harmgart said the EBRD have already done quite significant projects in the solar energy field in the first and second rounds, plus the financing with NEPCO on the transmission network. "However, desalination is the next biggest project, which addresses one of the key challenges for Jordan," she added. "What we want to do there is really make sure that the energy that's needed to desalinate water in Aqaba and pumping elsewhere is renewable energy, such as solar and wind rather than non-renewable sources."

"We have in total invested 1.5 billion euros since we started operating in Jordan less than 10 years ago and but we hope to really increase our investments over the next years," Harmgart announced. "We signed $50 million financing with the Housing Bank for Trade and Finance, which is for trade facilitation, thus helping Jordan and importers and exporters to access a large network of issuing and correspondence banks globally. It is also directed to on-lending to small and medium enterprises."

The EBRD, which was established in 1991 and is headquartered in London, has invested in over 38 projects in the sectors of renewable energy, pharmaceutical industries, water and sewage, solid waste, financial institutions and the development of small and medium-sized enterprises in Jordan.

Jordan became a member of the EBRD in 2011, and the bank opened a permanent office in Amman in 2013, to manage its operations in the kingdom.

The number of EBRD member states is currently 66 countries from 5 continents, and the European Union and the European Investment Bank are major shareholders.


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