Jordan Gateway Projects Co.

completed

The project is to develop, construct and operate Jordan Gateway Industrial Estate to be located west of the city of Irbid in Jordan at the Jordan-Israel border. The first phase of the project, which will be self-sustaining, will involve land and infrastructure development of (i) 25 ha. area on the Jordanian side, (ii) about 10 ha. on the Israeli side, and (iii) construction of a bridge across the Jordan river connecting the Jordanian and the Israeli sides of the estate. IFC will finance only the first phase on the Jordanian side (the "Project"). In the second phase, which is expected to be implemented after 4-5 years, the estate area may be enlarged by 27 ha. to a total of 52 ha. The Israeli side will be independently financed and managed by the Sponsors through a separate project company. The industrial estate will be attractive for tenant companies because of a) its status as a "Qualifying Industrial Zone" (QIZ), which provides quota-free and duty-free access to the US market if certain Jordanian/Israeli content conditions are met, and b) its "Free Zone" status, which provides tax-free status on profits and salaries, exemption from import and custom duties, and free transfer of capital abroad. The Project is expected to house (a) light manufacturing industries, (b) commercial and high-tech service companies, (c) private and government services such as clearing agents, transportation, and customs, and (d) warehousing facilities for storage and transhipment of goods in transit between Israel (through the port of Haifa) and other Arab states. Most of the tenant companies will be located on the Jordanian side; the Israeli side is likely to have mainly customs and government offices, storage areas and trans-shipment services. The Project is expected to create several thousand jobs in Jordan and will facilitate foreign trade and investment while reducing impediments to cross-border economic activity. The first phase is estimated to cost US$30 million on the Jordanian side alone and is expected to be ready for occupancy by January 2001. IFC has been requested to provide a long-term loan of up to US$10 million and arrange up to US$5 million from other financial institutions to finance the Project.