The European Investment Bank (EIB is supporting Jordanian economy, with a €70 million line of credit to Capital Bank of Jordan to be on-lent primarily to local small- and medium-sized enterprises (SMEs), which have been severely affected by the economic consequences of the coronavirus outbreak.
SMEs are the backbone of the Jordanian economy as they account for over 95% of local businesses, contribute to more than 50% of GDP, and employ about 60% of the working population. As a consequence of the Covid-19 outbreak, many companies have experienced a decrease in turnover and profitability, leading to payment delays and an increased demand for liquidity. It is now crucial to step up support to private sector businesses, thus helping to protect jobs and keep the economy going.
The EIB financing comes under the Economic Resilience Initiative (ERI)This is the EU Bank’s first operation in response to Covid-19 impact in Jordan, and is part of its €6.77 billion support package in the countries outside the EU in the context of the Team Europe’s response to help mitigate the impact of the coronavirus pandemic.
Since its inception in 1995, Capital Bank of Jordan has become one of the leading financial institutions, offering a comprehensive set of added-value commercial and investment banking services tailored to the needs of individuals and institutional clients in Jordan and the region. Capital Bank offers a broad set of financial products for its Corporate and SME clients, capitalizing on its established expertise in the Jordanian market, as well as its regional presence.
Flavia Palanza, Director of the EU Neighbourhood Department at the EIB, said “It is one of EIB’s top priorities to support the resilience of the private sector during this unprecedented crisis with the provision of funding through our cooperation with the Jordanian banking sector. Our partnership with Capital Bank of Jordan aims to make available vital financing for SMEs and Mid-Caps to help them cope with the economic impact of the Covid-19 pandemic. As part of the Team Europe response, we are committed to stepping up our support for Jordan to address the immediate challenges caused by the pandemic, as well as lay the foundations for a successful economic recovery after the crisis.”
European Union Ambassador to Jordan, H.E. Maria Hadjitheodosiou, commended the “timely and crucial” financing provided by the EIB to Capital Bank of Jordan, which will enable SMEs struggling to cope with the economic impact of the coronavirus, to continue operating, and assist them to sustain and create new jobs.
The Ambassador underlined that "this Team Europe package, which is part of the European Union’s covid-19 response, complements the Jordanian government’s response to support entrepreneurship and job creation.”
Chairman of Capital Bank, H.E. Bassem Khalil Al-Salem said: “We are proud to be the first bank in Jordan to cooperate with the EIB in its current response to the Covid-19 emergency. This strategic alliance will serve to support small and medium Jordanian enterprises and stands as a testament to the trust that EIB has in Capital Bank as a reputable and reliable partner capable to support this vital sector of the economy. Through our cooperation with EIB, Capital Bank will be able to offer support to new and existing clients to grow and prosper.”
Al-Salem added: “SMEs are the backbone of our national economy’s development and growth and have been affected by the current Covid-19 crisis. This cooperation with EIB will be a strong tool to help support this essential sector in our economy. Both Capital Bank and EIB have a strong track record in supporting SMEs. With this strategic partnership, we will dedicate our efforts to create new employment opportunities, increase competitiveness and stimulate growth in order to promote a more dynamic Jordanian economy.”
Note to the editor
The European Investment Bank (EIB) is the European Union's bank. It is the long-term lending institution of the EU and is the only bank owned by and representing the interests of the European Union Member States. The EIB works closely with other EU institutions to implement EU policy.
Follow us on twitter :@eib