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JORDAN ENTERPRISE DEVELOPMENT CORPORATION A Tool to Develop Private Sector SMEs.

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Presentation on theme: "JORDAN ENTERPRISE DEVELOPMENT CORPORATION A Tool to Develop Private Sector SMEs."— Presentation transcript:

1 JORDAN ENTERPRISE DEVELOPMENT CORPORATION A Tool to Develop Private Sector SMEs

2 Corporate Governance  JEDCO is overseen by a Board headed by H.E. Minister of Industry and Trade and is comprised from 6 representative of the public Sector and 10 representatives of the private sector.

3 JEDCO Programmes  Jordan Upgrading and Modernisation Programme (JUMP I).  Support to Enterprise & Export Development Programme (SEEDP / JUMP II)  Jordan Services Modernisation Programme (JSMP).  Jordan Services Modernisation Programme (JSMPII).  Export Promotion Programme.  Entrepreneurship and innovation Program (JIC Network)  Financial Tools Jordan Enterprise Development Corporation Financial Tools JSMP/ JSMPII JIC Network Export Promotion Programme JUMP / JUMPII

4 Industry Support Directorate (JUMP) Achievements up to Year 2010 ActivityGrand TotalCompletedIn process Conduct studies (FSD, BP, NLP) Signed Agreements to Implement Development plans Conduct Energy Audit and Solar Energy Studies31283 Signed Agreements to Implement880 Export Consortium220 Faculty for Factory project Sectorial services Services resulted from development plans Other activities ( training, workshops,..etc)329 0 Total companies benefited from JUMP Total services supported by JUMP

5 Impact of the Support to JUMP clients Indicator% Total Sales (000 JD)73% Exports (000 JD)116% Gross Profit (000 JD)56% Net Profit before Tax (000 JD)28% Employees 17%

6 JSMPII  JEDCO in cooperation with the EUD are launching JSMP II programme with an estimated budget of EUR 15 million, EUR 12.2 million Direct Grants to MSMEs to cover 5 different schemes. JUMPII  JEDCO in cooperation with the EUD are extending JUMPII programme with an estimated budget of EUR 10 million, EUR 12.5 million Direct Grants to MSMEs to cover 3 different schemes.

7 JUMPII Grant Schemes Scheme 2: Support to Export Development Including Certification and Participation to Trade Missions and Trade Events. (50,000 EURO) Scheme 4: Support to Micro Enterprises and Start-up Companies.(50,000 EURO) Scheme 5: SMEs Reinforcements. ( 100,000 EURO) Scheme 2: Support to Export Development Including Certification and Participation to Trade Missions and Trade Events. (50,000 EURO) Scheme 4: Support to Micro Enterprises and Start-up Companies.(50,000 EURO) Scheme 5: SMEs Reinforcements. ( 100,000 EURO)

8 JSMPII Grant Schemes Scheme 1: Export Development and Participation in Trade Missions and Trade Events (EURO 50,000) Scheme 2: Support for start-ups and innovative services start-ups outside Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 3: Reinforcement of existing services MSMEs outside Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 4: Reinforcement of existing services MSMEs within Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 5: Support for Projects of National Interest in all Areas of Jordan (EURO 10,000) Scheme 1: Export Development and Participation in Trade Missions and Trade Events (EURO 50,000) Scheme 2: Support for start-ups and innovative services start-ups outside Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 3: Reinforcement of existing services MSMEs outside Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 4: Reinforcement of existing services MSMEs within Greater Amman Municipalities, Qasabet Irbid and Zarqa Municipalities (EURO 75,000) Scheme 5: Support for Projects of National Interest in all Areas of Jordan (EURO 10,000)

9 Governate Development Fund Eligibility Criteria Project’s Eligibility Criteria  Project’s owner contribution not less than 10% of total project cost.  A minimum of 60% Jordanian employees. Economically feasible projects, with high economic and social added value, ability to create employment opportunities, substitute foreign employment, export potentials with clustering opportunities with other sectors. Fund’s contribution ranges between a minimum of 26% to a maximum of 49% of total project’s cost. Fund’s minimum investment size is JOD 50,000 The Fund will invest in projects with a minimum cost of JOD 100,000

10 Investment Tools The Governorate Development Fund will invest in productive and income generating projects using non traditional financing tools: Equity Investment: holding shares in projects’ capital for a certain period of time not exceeding 8 years and sharing profits and losses with the owners instead of paying periodical repayments. Convertible Bonds: financing bonds (partner’s loan) to be converted into shares based on a pre-agreed upon requirements as determined in partnership agreement. Quasi Equity: a hybrid tool that combines between equity and debt features, repayment and profit sharing to be determined in the partnership agreement.

11 Export Promotion Companies Participation in Trade Fairs

12 Impact of the Export Promotion Support IndicatorRate of Increase More than 30%15% - 20%10% -15% Improvement in Production14%27%45% Increase in Exports14%24%48% Increase in Sales5%30%45% New Markets 37% of the companies

13 Venture Capital Funds JEDCO was entrusted by the Government of Jordan to sponsor the creation of two venture capital funds dedicated respectively for the early stage and developing SMEs. The two “Anchor Investors” JEDCO and EIB as follows: JEDCO was entrusted by the Government of Jordan to sponsor the creation of two venture capital funds dedicated respectively for the early stage and developing SMEs. The two “Anchor Investors” JEDCO and EIB as follows: FundFirst/Target SizeGoJ AllocationEIB Allocation Early StageUS$ 15 millionUS$ 2 million (need finance) US$ 2 (not to exceed 30% of total commitments Capital for Growth Fund EUR 20 millionEUR 2 millionEUR 5 million (not to exceed 25% of total commitments)

14 SME Financing Programme SME Financing Program Int. GuarantorsJEDCO LGF 250M 60-75% coverage ratio of loan value TA Before Financing Services After Financing Services Grants Up to 20% of total financing needs for special projects. Banks Loans $ $ 2,000,000

15 SME Financing Programme AmmanGovernorates As needed TA Before & After Financing 100% Project cost 0-15% Owner (contribution) NAUp to 20%Grant ( of the financing needs) 60%75%Loan (Guarantee coverage) 50%35 %Collaterals (Max) 7-8yearsMed term loans 2-3 yearsGrace periods Less than prime rateModerate interest rates

16 JIC Network (SCF) Remarks DurationSeed Capital Fund Provided (JD) Incubated projects Governance ,82062Amman ,9201Balqa ,00039Irbid New Intervention ,0002Jerash ,0004Karak New Intervention ,0004Tafeleh New Intervention ,0001Madaba

17 Tafileh 1000 residence

18 JSMP I and JUMP II Renewable Energy projects - Supported in the last two years (Start up, Reinforcement and Export Oriented) GovernorateGrants Amman 207,504 Balqa 97,989 Aqaba 137,587 Total (9) 443,080 - Application Received Recently GovernorateGrants Amman 32,358 Irbid 222,993 Maan 75,000 Madaba 146,200 Mafraq 182,231 Tafeeleh 75,000 Total (13) 733,782

19 Total number of Beneficiaries from JEDCO’s Different Services ServicesNumber Reinforcement598 Start- ups217 Trade Fairs and Trade Missions2293 Technical Assistance (JSMP& JUMP II)280 Total3388* Companies from Governorates – 292: Start-up projects : 145 Reinforcement companies: 147

20 JEDCO’s Budget JEDCO’s Budget Government of Jordan25,000,000 $ EU Grants42,000,000 $ Donors33,000,000 $ 100,000,000 $ Total: JEDCO’s Budget Government of Jordan25,000,000 $ EU Grants32,000,000 $ Governorate Development Fund210,000,000 $ USAID31,000,000 $ Total: 298,000,000 $

21 Supports enterprises throughout its lifecycle Business lifecycle Start UpGrowthExpansionMaturityTransition Financin g Technical assistance


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