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EIB provides 30m euros in pandemic support for local businesses

(File photo: Ameer Khalifeh/ Jordan News)
AMMAN — New research conducted by the European Investment Bank (EIB), in cooperation with the Central Bank of Jordan, revealed that although the Jordanian economy has been affected by the COVID-19 pandemic, the banking sector has remained strong and resilient. اضافة اعلان

The findings of the "Banking in Jordan: Financing corporates and SMEs in the era of the COVID-19" research were highlighted at a press conference held in Amman on Wednesday, in the presence of Ambassador of the European Union Maria Hadjitheodosiou, European Investment Bank Vice President Gelsomina Vigliotti, and Jordan Commercial Bank CEO Caesar Qulajen.

At the conference, the EIB announced that it will provide 30 million euros to the Jordan Commercial Bank for on-lending to local companies to help them create jobs and enhance economic growth and resilience, namely targeting businesses that were most impacted by the pandemic.

The EIB financing comes under the Economic Resilience Initiative, which is part of the European Union's response to challenges in the “Southern Neighborhood” of the Mediterranean, such as forced displacement and migration, economic downturns, and political crisis. Under this initiative, the EIB has made 750 million euros available to seven Jordanian financial intermediaries.

The Jordan SME (small and medium enterprise) finance 2022 conference also provided an opportunity for banking and business leaders, policymakers, and international partners to exchange best-practice insights on SME financing and to give them the opportunity to learn from recent policy responses to mitigate the economic impact of the COVID-19 Pandemic.

Hadjitheodosiou said that the European Union is committed to supporting private sector growth in Jordan and enhancing economic resilience, adding that the conference provides a unique opportunity to discuss current business financing priorities and enhance cooperation with Jordanian financial partners.

She told Jordan News that the European Union is concerned about supporting and enhancing economic growth, and that this step would contribute to revving up the economy.

EIB vice president Vigliotti told Jordan News that Jordan is full of promising investments, stressing the importance of supporting and funding the private sector since it plays an important role in economic growth and creating job opportunities. “Our objective is supporting small and medium sized enterprises which are considered the backbone of the economy," said Vigliotti.

The report showed that liquidity support, loan rescheduling, and additional guarantees for small and medium-sized companies enabled credit growth and the profitability of the banking sector.

The report also showed that the impact of the pandemic on credit supply in Jordan has been relatively contained, with about two-thirds of the banks surveyed reporting stabilization or even an increase in the supply of credit.

The pandemic has been a game-changer for banking services and triggered a strong push towards greater digitization. With regard to internal operations, 90 percent of banks confirmed that the pandemic would accelerate the digitization of internal operations.

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