Download People, MFIs, Countries in Focus

People, MFIs, Countries in Focus
Jordan
Jordan,*
officially the Hashemite Kingdom of Jordan, is an Arab
country in Southwest Asia
spanning the southern part of
the Syrian Desert down to the
Gulf of Aqaba. It shares borders with Syria to the north,
Iraq to the north-east, Israel to
the west, and Saudi Arabia to
the east and south. Much of
Jordan is covered by desert,
particularly the Arabian Desert; however the north-western area,
with the Jordan River, is regarded as part of the Fertile Crescent.
The capital city of Amman is in the north-west.
Jordan is part of a region considered to be "the cradle of civilization", the Levant region of the Fertile Crescent.
Jordan's territory measures 89,341 km² and its population numbers about 6,000,000 (2008 estimate). Arabic is the official language of Jordan. English is widely understood among most Jordanians. French is understood by some, especially graduates of the
handful of French schools in Jordan. Armenian and some of Caucasian languages are understood and spoken by their respective
communities residing in Jordan with minority schools teaching
these languages, alongside Arabic and English.
pecially active in liberalizing the private investment regime, opening the trade regime, establishing modern regulation and institutions for private sector development, and privatization. Further
improvement in the business environment in Jordan, both on the
public and private sector sides, is important to unlock the country’s
growth potential.
Jordan’s economy has shown strong performance in recent years
and real growth - averaging 7 percent during the 2004-07 period continues to be robust at 6 percent in 2007. However, Jordan remains vulnerable to possible adverse external events, such as the
evolution of world oil and food prices, the level of foreign grants,
the regional security situation, and the flows of short-term external
capital. Growth is broad based, led by manufacturing, construction, real estate and services sectors.
Using the demographic opportunity of a very young population to
transform Jordan from a small lower-middle income and vulnerable country into a modern knowledge-based economy is at the
core of King Adballah II’s vision for the country. The long-term
vision implies a bold modernization of the country’s economic,
institutional and political infrastructure, based on the enhancement
of its human capital, and the elimination of poverty. Education,
improving the business environment, and attacking deep poverty
are at the core of this vision, and the Government is well aware
that this also requires a modern and efficient administration, and a
more open and participative state.
The microfinance industry in Jordan has proven its effectiveness in
The Hashemite Kingdom of Jordan is notably resource-poor, with
acting as a vehicle available for low-income citizens, particularly
limited agricultural land, no oil resources, and considerably scarce
women, to improve their financial status, and their living standards.
water. Its only natural resources are potash and phosphate. The
population is urbanized at around 80 percent, and is one of the
youngest among lower-middle income countries, with 38 percent
Middle East Micro Credit Company (MEMCC),
under the age of 14.
Amman, Jordan
Notwithstanding the difficult regional political environment and the
lack of resources, Jordan has achieved above-average develop- The mission of Middle East Micro Credit Company is “to help indiment outcomes compared to other lower middle-income countries. vidual micro and small business owners to achieve a better living
This favorable situation can be credited to sound development standard through financing their projects to generate more inpolicies, high capital inflows over the last four years in particular, come”.
and to one of the world's highest levels of unilateral transfers, in
The origination of MEMCO dates back to 1998 when CHF Internathe form of workers’ remittances and public grants, together
tional signed a Cooperative Agreement with USAID to fund The
amounting to around 22 percent of GDP. Jordan’s GNI per capita
Southern Jordan Access to Credit Project (SJACP) by a capital of
in 2007 was $2,918.
USD 4 Million in the form of a grant. The program rapidly spread
Over the last 10 years, Jordan has been very active in reforming over the target region and had six branches operating at the end
its economy. It ranks as one of the best reformers compared to of 2000.
other middle income-countries. Structural reforms have been es
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People, MFIs, Countries in Focus
Jordan
In early 2001, the project was expanded to the middle and north- Mrs. Fitna Damen, Micro-businesswoman
ern parts of Jordan where four new branch offices were opened. In
Place: Village of Emraa, Jordan
January 2003, the limited liability company Middle East Micro
Credit Company (MEMCC) was registered and all the project’s Activity: Sheep Farming
assets were transferred to the new entity.
Fitna Damen lives with her husband and three children in the vilCurrently MEMCC operates eleven branches, serving the upper lage of Emraa. Fitna and her husband were struggling to provide
for their family. Coming from a rural background where sheep
segment of the microentrepreneuer market and the SME market.
farming is quite common, Fitna thought of starting a private busiMEMCC offers eight individual loan products for business and
ness in this field.
consumption purposes. Business loans include a regular individual
business loan and a family business loan, a short term seasonal Yet, the lack of funding and her inability to apply for a bank loan
loan, an agricultural loan, and an innovative accounts receivable nearly left her in despair, until she heard about MEMCC and the
loan for small entrepreneurs which sell on credit. Other loans in- loans they offered. Lacking the assets to provide for a substantial
clude a classical consumption loan, a home improvement loan, guarantee, she started with a small loan of US$200. As a result of
and a capacity building loan dedicated to vocational training fees her hard work she was able to repay the loan on time.
for women.
As a result of her efforts and enthusiasm, MEMCC gave her a
MEMCC’s current total lending activity is 92%, it has 11,458 cli- second loan for US$1,000. Knowing that MEMCC is there to supents - active borrowers out of which around 50% are women bor- port her, Fitna is working with more passion, knowing she can
rowers, its average credit per borrower is USD 1,388 (as of end of provide for her family.
2008).
MEMCC reaches out to a broad clientele and serves the changing
needs in the market. In the future MEMCC hopes to expand its
loan products to serve specific niches—including Islamic and student loan products—to compliment its current housing, family business, and seasonal loan products.
*Source: The World Bank; Symbiotics; CHF International; MEMCC.
Vision Microfinance Fund started to work with MEMCC in 2008
and has provided the MFI with direct loans for the total amount of
USD 1,400,000.
Photo: MEMCC
Absolute Portfolio Management , Wallnerstraße 3/17, A-1010 Wien, Tel.: +43 1 533 59 76
[email protected]; www.visionmicrofinance.com
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