EBRD launches new facility for Jordan’s enterprises

AMMAN –– The European Bank for Reconstruction and Development (EBRD) on Monday officially launched a special unit to help the Kingdom’s small- and medium-sized businesses, which according to a government official struggle to access finance. 

On Monday evening, the EBRD’s Small Business Support (SBS) held an official launch event –– attended by executives from the London-based bank, government officials and a large number of private sector representatives –– to increase the awareness of local companies about the activities of the unit in Jordan. 

Speaking at the event, head of EBRD office in Jordan Heike Harmgart said SBS has been active in Jordan since 2012, providing business advice through more than 40 projects, helping companies access the know-how they need to succeed and grow. 

The programme’s activities in the southern and eastern Mediterranean (SEMED) region are funded by the SEMED Multi-Donor Account and the SEMED cooperation funds account, which have provided 2.4 million euros in donor support, according to the bank.  

Accounting for more than 98 per cent of active enterprises in Jordan, around 70 per cent of total employment, 40 per cent of national exports,  SMEs in Jordan still face challenges in access to finance, said Yarub Qudah, chief executive officer of the Jordan Enterprise Development Corporation. 

He indicated that the sector’s share of credit facilities extended by banks is only 5 per cent, describing the figure as “ironic”. 

Qudah said that in the past decade, Jordan’s exports grew from JD1.6 billion to JD7 billion, thanks to SMEs. 

“Without small- and medium-sized enterprises the Kingdom’s economy would not have grown,” he added, calling on the private sector to seize the support of  EBRD programme. 

Strengthening small businesses is a top priority for EBRD activities in Jordan as the country faces significant regional disparities, according to Hildegard Gacek, the bank’s managing director for SEMED. 

Smaller businesses continue to suffer from poor access to finance, limited exposure to managerial best practices and low productivity, which hamper their potential to create jobs, she said.

Charlotte Ruhe, director of the Small Business Support team at the EBRD, noted that the SBS facility can play a key role in supporting small businesses. 

“Improving access to external advice is important in helping them grow and become catalysts for the country’s economic development,” she said.

Drawing on the expertise of local consultants and international experts, SBS connects small- and medium-sized enterprises with the expertise that can boost their businesses, transferring the skills and know-how that help them innovate, attract finance and source further expertise, she added. 

The EBRD’s SBS team introduces the latest best practice in marketing, operations, information communication technology, human resources and energy efficiency to improve quality, resource efficiency and growth, according to the bank’s official. 

In addition to working with individual businesses, the EBRD also engages with government agencies, local business associations and chambers of commerce.  

In October last year, the EBRD opened a permanent office in Jordan in a step that was described by executives as long-term commitment to supporting economic development in the Kingdom.

The bank has also invested in two major projects in Jordan: A $100 million loan for Al Manakher Power Plant, and a $80 million credit for the Abdali shopping mall and entertainment centre in Amman.

Late last year, the bank granted Jordan the status of a recipient country, allowing the Kingdom to benefit from the bank’s capital resources.