World Bank mulls $50m in support to startups in Kingdom

AMMAN — The World Bank is considering providing a new proposed financing of $50 million to support start-ups and small and medium enterprises in Jordan, as mentored on Thursday by Al-Rai Newspaper.

The new proposed financing aims to stimulate private investment and support employment opportunities in the private sector, which is under study and comes as a continuation of the success achieved by the Innovative Startups and SMEs Fund (ISSF), funded by the Central Bank of Jordan (CBJ) and the World Bank, in its first phase, according to the World Bank's data.

The proposed "pivotal step" project will be based on the ISSF's position as a leading institution in a "strong" investment environment regionally and internationally, in order to enhance funding and expand opportunities for startups, with a focus on; investments in venture capital funds, joint investment in start-ups, stimulate private investment, strengthen linkages with regional and global markets, and support the growth of investable companies by providing advanced incubation and acceleration services.

The Kingdom has become one of the "fastest" growing venture capital markets in the MENA region, according to the World Bank during the period of 2018-2022; Jordan was ranked fourth among the countries with the most funding in the venture capital market in the region, whereas the value of investments in Jordanian startups amounted to $ 246 million.

The bank pointed out that the most important sectors that attracted venture capital investments in the Kingdom were e-commerce and retail by 20 per cent, educational technology by 16 per cent, and health technology by 15 per cent.

By the end of October 2024, the World Bank had transferred $46.8 million to the innovative companies support project, with 93.6 per cent of the total financing of $50 million, in a project that created more than 1,760 jobs in the Kingdom.

According to World Bank data, the $98 million startup and small enterprise support fund project, which was jointly financed by the ISSF, International Bank for Reconstruction and Development (IBRD) with value of $50 million and the CBJ with value of $48 million.

Noting that the project was approved by the World Bank on June 2017, while it was launched in Jordan on September 2018, and will be completed on June 30, 2025.

The project allocated more than 82 per cent of the fund's total investable capital to the end of last year, while the fund's investments attracted more than $200 million of private capital in multiple fundraising, benefiting from 19 institutional investors, and funding 138 companies (31 women-led and 60 youth-led).

These results has contributed to the creation of more than 1,760 jobs in the Kingdom, as the fund played a "pivotal" role in supporting startups through investment readiness and business development services, and stimulating support for investable startups through incubation and acceleration services, while the project remains of strategic importance and useful to support the growth of the entrepreneurship ecosystem in Jordan as Al-Rai Newspaper reported.