Jordan, Islamic Bank for Development sign $100 million loan-grant deal

AMMAN — Planning and International Cooperation Minister Imad Fakhoury has headed Jordan's delegation to the 42nd meeting of the Islamic Bank for Development Group's Board of Governors.

During the meeting, Jordan was elected as a member of the organising committee for the meetings, along with Bangladesh, Afghanistan, Albania, Indonesia, Azerbaijan, and Tunisia. Jordan was also elected as a member in the bank's board of executive directors and a representative of the Arab group G, which comprises Iraq, Palestine, Syria and Lebanon, according to a statement from the Planning Ministry on Friday.

The meeting, held in Jeddah under the patronage of Saudi Arabia King Salman Bin Abdulaziz, was attended by representative of 57 member countries.  

During his address at the first session of the governors' meeting, Fakhoury, who is also Jordan's governor at the bank, thanked Saudi Arabia and the bank for their efforts to support the member countries including Jordan.

The planning minister outlined the financial and economic challenges facing Jordan and the efforts and measures taken by the government since the beginning of the Syrian crisis to counter them. He also stressed the economic burdens resulting from the regional instability and the influx of 1.3 million Syrian refugees to the Kingdom.

Fakhoury called for increasing support to the Jordan Response Plan (JRP) and to bridge the financial gap through grants and concessional financing to transform the Syrian crisis into an opportunity that helps refugees and host communities.

He reviewed the development and reform programmes, noting that Jordan did not take the regional instability as a pretext to slow down its reform process.

The planning minister called upon the Islamic Bank for Development to provide the necessary grants to fund the JRP 2017-2019 and the economic stimulation plan 2018-2022, as well as supporting the Global Concessional Financing Facility, small- and medium-sized enterprises, and infrastructure projects that are implemented through the public-private sector partnership.

On the sidelines of the meeting, Fakhoury joined the governors' forum as a keynote speaker, where he stressed the importance of empowering young people, as they constitute 70 per cent of the member countries' populations, the statement said. 

At the panel, he presented Jordan's expertise, youth self-employment initiatives, youth-supporting platforms, and the Jordan National Strategy for the Development of Human Resources. 

The minister congratulated Bandar Hajjar, president of Islamic Development Bank Group on his new post as the president of the bank's group and expressed appreciation for the approval of $100 million concessional financing, $79 million of which as a soft loan and $21 million as a grant.

The loan and the grant are scheduled to finance a health project in the Kingdom as part of the Global Concessional Financing Facility,  an initiative by the World Bank, the UN and the Islamic Bank for Development to support budgets of countries that are affected by refugees' influxes in the Middle East and North Africa.

Fakhoury also met with Hani Sonbol, chief executive officer of the International Islamic Trade Finance Corporation, to whom he expressed his keenness to develop cooperation with the corporation, stressing the importance of the corporation's technical visit to Jordan, which aims to discuss an agreement to provide $3 billion to finance Jordanian companies and corporations.

During his meeting with Yousef Ibrahim Al Bassam, the Saudi Fund for Development vice chairman and managing director, Fakhoury signed amending agreements related to the projects funded by Saudi Arabia as part of the Gulf Grant.

The agreements seek optimal use of funds provided through the grant in accordance with the national priorities, such as building schools and kindergardens, building and improving hospitals, installing and rehabilitating water and sewage networks, railway project, economic development zones infrastructure, and supporting the Royal Medical Services.

The Islamic Bank for Development is a strategic partner of the Jordanian government and has provided $975.6 million since 1975 in loans and grants to support projects in all fields, according to the statement.

Projects in key sectors 

In 2015, and in conjunction with hosting the World Economic Forum, Jordan launched a number of projects and investment opportunities in key sectors, such as energy and renewable energy, transport, water, telecommunications and ICT, infrastructure, tourism and urban development. 

During the 2015-2017 period, the Kingdom began implementing projects worth $6.3 billion, despite regional challenges and the world economy’s slowdown.

*Energy and renewable energy: Jordan invested $1.5 billion in renewable energy, $2 billion to produce electricity from shale, $100 million in Greater Amman Municipality's renewable energy projects and $1 billion in the Jordan-Iraq oil pipeline.

*Infrastructure: $1.3 billion in the Red Sea-Dead Sea Water Conveyance Project’s first phase.

*Telecommunications and ICT: $142 million to implement the national broadband network in the southern, central and northern provinces.

*Aqaba Special Economic Zone: $260 million to implement infrastructure, urban development, Aqaba port and tourism.

Source: Ministry of Planning and International Cooperation