New Delhi :The World Bank has approved US$85 million in financing for the Jordan Support for Industry Development Fund Project, which aims to promote investments and exports in the manufacturing sector through the operationalization of a new Industry Development Fund. The fund is one of the commitments Jordan has made under its Economic Priority Plan 2021–2023.
Jordan urgently needs to create inclusive and broad-based job opportunities to promote resilient recovery from the COVID-19 crisis, requiring a shift towards a resource-efficient, export- and investment-driven growth model. Manufacturing, among the largest employers in Jordan’s economy, suffered acute shortages of cash during the COVID-19 pandemic. To diversify and expand their exports, and generate more jobs, companies now need to move out of survival mode to a new level of competitiveness.
The Government of Jordan is establishing the Industry Development Fund to put its development policies and programs on manufacturing into practice. The government asked for the World Bank’s support in designing and operationalizing the fund as an efficient, transparent, and effective delivery platform for support for firms, and as a key financial enabler for industrial transformation. Its focus will be upgrading and modernizing industries; export development and promotion; and incentivizing companies toward high performance in areas critical to the sector reaching its full potential, such as increased climate-responsiveness and female employment.
“The Industry Development Fund is a key instrument in our Economic Priority Plan 2021–2023 to help firms in the industrial sector recover and build back better following the COVID-19 crisis,” said H.E. Nasser Shraideh, Minister of Planning and International Cooperation of Jordan. “It will serve as a stimulus to promote private sector-led investment, as well as modernization, upgrading, and export development, which are key engines of growth for the Jordanian economy.”
The project aims to support more than 500 export-oriented firms directly through the fund’s programs and to mobilize at least US$17 million in additional private capital. It will also support the building of effective delivery mechanisms and a robust governance and operational capacity, enabling the fund to support the transformation of the industrial sector in the longer term.
“Jordan’s recovery from the COVID-19 pandemic has been broad-based, but many sub-sectors are operating below their pre-pandemic level and external shocks have led to higher unemployment, especially for women and the youth,” said Saroj Kumar Jha, Mashreq Regional Director, World Bank Group. “This project will complement the integrated package of support for private sector development that the Bank and the Government of Jordan are implementing to foster enhanced public-private partnerships for inclusive and resilient recovery and growth.”
The main activities financed by the Fund will include: (i) Industry upgrading and export development programs; (ii) Outcome-based incentives program; and (iii) Easing access to export credit insurance and to new supply chain finance products.
The project prioritizes gender balance and includes measures to ensure the inclusion of women business leaders/owners and employees, and of various vulnerable groups in the fund’s programs.