- Implementation Support Agency (ISA): World Bank
- Total project financing: $500 million
- Funding from GCFF: $111 million
- GCFF Financing Approval Date: 05/29/2018
- Project Closing Date: 12/31/2021
- % Disbursed: 100%
- Status: Closed
About the project
The DPF was designed to help Jordan lay the foundations for a higher and more sustainable economic growth path while creating more jobs for Jordanians and non-Jordanians. The post‐2011 refugee influx has deepened Jordan’s labor abundance, but it did not alter the structural pattern of job creation Currently, job growth is concentrated in low productivity sectors with localized markets and limited attractiveness to efficiency‐seeking investment. Going forward, Jordan is seeking to build resilience into its economy by raising productivity, expanding domestic markets through improved access to finance and stronger institutions for managing risk, and opening new external markets. Jordan’s previously successful formula for coping with geopolitical challenges has run into new trends of lower grants, remittances, and investment flows. While the new government will have the benefit of a fresh start on building consensus for reforms, it faces heightened uncertainty over the summer, necessitating accelerated international support. Jordan’s response to the country’s productivity, jobs, and conflict spillover challenges is to seek international support for the fiscal costs of the spillovers, while using that support to catalyze reforms capable of generating productive jobs in a labor‐abundant economy. The Government of Jordan (GoJ) is putting together a five‐year priority reform program for equitable growth and job creation whose objective is to set the foundations for higher growth. The program responds to the challenges of prioritizing and implementing reforms that Jordan has included in its strategic documents in the past. Jordan’s Vision 2025 was developed in 2014 and has been under implementation since then. The DPF series is a part of a comprehensive approach to tackle the nexus of a complex legal and regulatory framework, discretionary implementation, lack of access to formal sector markets, and a narrow tax base due to widespread informality.
Project Development Objective (PDO)
To support Jordan to set foundations to:
1. reduce business costs and improve market accessibility,
2. create more flexible and integrated labor markets and provide better and more efficient social assistance, and
3. improve fiscal sustainability and take more informed decisions regarding risk.
Project Implementation Status
(As of December 31, 2022)
- Jordan First Equitable Growth and Job Creation DPL (DPL1, Board approved June 17, 2018) was followed by the Jordan Second Equitable Growth and Job Creation DPL (DPL2, Board approved June 4, 2019). The DPL1 policy matrix was adjusted for DPL2 when the program was strengthened substantially. DPL1 Performance was in the Satisfactory – Moderately Satisfactory range though November 2020 when the last ISR was published. During 2021 some challenges emerged and the and follow up actions are currently being discussed. Overall, the results are as follows:
- For Pillar 1, the results on the private sector environment are mixed, with about 50 percent of results achieved, primarily in monitoring and inspections, licensing and export guaranteed and the national broadband. Importantly, the implementation progress is lagging in areas where government is making a course adjustment with the preparation of the Omnibus legislation.
- For Pillar II, the goal of creating a more efficient social assistance system has been largely met, which is an admirable achievement. For this pillar, 75 percent of the results indicators have been achieved. Regarding Syrian refugees, all actions under DPL1 have been implemented, are continuing, and results have been met.
- For Pillar III, which is dominated by energy and fiscal actions, very significant and worthwhile progress has been made in recent years on domestic revenue mobilization, PPPs, and PIM implementation. However, challenges need to be ironed out in energy and PPPs.