Khaberni - Dr. Raad Mahmoud Al-Tal wrote:
The Industrial Development Bank was founded to finance medium and long-term industrial projects, at a time when commercial banks were avoiding the risks involved in this type of financing. It served as the financial arm for industrial development, bridging government policies and private sector needs. The Export Financing Bank aimed to empower Jordanian exporters to enter foreign markets through financing tools and guarantees that reduced commercial risks and enhanced export competitiveness. With the transformation of these banks into commercial institutions, Jordan's development system lost two institutions that had been bridging finance and production.
Today, with the slowdown in industrial investment and relatively weak exports, there emerges a need to establish a national development bank, to be a financial institution specialized in managing investments and financing development projects, and a lever for local and international capital. This bank's role is not limited to granting loans, but it acts as a "financial manager" for the national development plan, coordinating between the government, the private sector, and investors, and directing financing towards projects with high economic feasibility and sustainable social impact.
The importance of this bank lies in that it rebuilds the developmental financing system on institutional foundations, and gives Jordan an executive tool to translate economic plans into productive projects. It could also be a platform that utilizes local and foreign resources, through attracting Arab and international capitals in organized investment partnerships. At the same time, the bank would be an official negotiation channel with creditors and international institutions (in addition to the Ministry of Planning), enhancing the independence of national financial decisions and re-prioritizing external financing towards genuine development rather than just covering financial deficits.
However, the most important role of this bank should be in stimulating local production and supporting exports. Financing new industrial projects, upgrading production lines, and providing guarantees for exporters are direct tools for increasing local added value. The bank could also finance the expansion of Jordanian companies into new regional markets and support small and medium industries in national supply chains, thereby enhancing production efficiency and reducing dependence on imports.
Re-thinking the model of Jordan's developmental bank is not a luxury but an economic necessity dictated by the requirements for growth and structural transformation in the Jordanian economy. The absence of a national financial institution managing the development portfolio has made developmental financing dispersed among ministries, funds, and entities not linked by a unified vision, weakening the coordination between donors and beneficiaries. The presence of one national bank with an independent professional management, operating based on principles of governance and transparency, will restore harmony between economic policies and financial execution tools. A developmental bank could truly be the lever for capital, and guarantee the sustainability of developmental projects in Jordan. An institution like this would redefine the relationship between the state and capital, and provide the Jordanian economy with an effective executive tool to convert visions and plans into tangible results.
