Amman, November 4, 2005
— The International Finance Corporation,
the private sector arm of the World Bank Group, has been appointed by the
Executive Privatization Committee of the Jordanian government to conduct
a feasibility study to determine the viability of privatizing Royal Jordanian
Airlines. The study will be undertaken by IFC’s technical assistance facility
that supports private sector development in the Middle East and North Africa,
Royal Jordanian Airlines began operations in 1963, flying three international
routes with a limited number of aircraft. Today, Royal Jordanian, with
its hub at Queen Alia International Airport in Amman, serves more than
50 cities in the Middle East, Africa, Europe, North America, and Asia.
Its fleet comprises 17 Airbus jets, including four A340s, with 10 additional
Airbus jets on order for delivery in 2006.
The Jordanian government, in an effort to increase the capacity of the
country’s tourism industry, is developing its airport and airline infrastructure.
IFC is expected to gauge the investment potential of the sector and identify
conditions for a successful privatization of Royal Jordanian Airlines.
The government will base its decision about the privatization process on
the outcome of the feasibility study.
Moh'd Abu Hammour, Chairman of the Executive Privatization Committee, stated,
“Royal Jordanian has made progress, but there is a strong role for the
private sector to play in helping it compete in the international aviation
sector and improve service to travelers. Strengthening the airline
is essential to developing Jordan’s tourism industry.”
Mr. Jesper Kjaer, IFC’s General Manager for PEP-MENA, noted that “The
development of Royal Jordanian Airlines will provide a solid foundation
for Jordan to compete in the global market. It will increase
air transport links, which are essential for commercial trade.”
PEP-MENA is IFC’s technical assistance facility that supports private
sector development in the Middle East and North Africa. PEP-MENA focuses
on improving the business-enabling and regulatory environment in the region;
strengthening the financial sector; promoting the growth of small and medium
enterprises and their support services, such as business organizations
and consulting firms; helping restructure and privatize state-owned enterprises;
and developing viable private sector and public-private partnership projects,
especially in infrastructure.
The International Finance Corporation is the private sector arm of the
World Bank Group and is headquartered in Washington, D.C. IFC coordinates
its activities with the other institutions of the World Bank Group but
is legally and financially independent. Its 178 member countries
provide its share capital and collectively determine its policies.
The mission of IFC is to promote sustainable private sector investment
in developing and transition countries, helping to reduce poverty and improve
people’s lives. IFC finances private sector investments in the developing
world, mobilizes capital in the international financial markets, helps
clients improve social and environmental sustainability, and provides technical
assistance and advice to governments and businesses. From its founding
in 1956 through FY05, IFC has committed more than $49 billion of its own
funds and arranged $24 billion in syndications for 3,319 companies in 140
developing countries. IFC’s worldwide committed portfolio as of FY05 was
$19.3 billion for its own account and $5.3 billion held for participants
in loan syndications. For more information, visit www.ifc.org.