Jordan - Second Growth and Competitiveness Development Policy Financing

Overview & Synopsis

The development objective of the Jordan Growth and Competitiveness DPF II for Jordan is to improve the enabling business environment and deepen access to finance for private sector-led growth. The operation supports reforms that reduce compliance costs and increase regulatory predictability through a unified, risk-based sectoral licensing program and strengthened competition enforcement; open the energy market to more competition by enabling privately owned independent transmission, renewable generation for self-consumption, and storage; and modernize the legal basis for digital commerce by expanding the scope of electronic transactions, recognizing cross-border digital certificates, and enabling electronic and remote notarization. It advances inclusion, jobs, and formalization by lowering fees and extending duration for highly skilled work permits and, critically, by establishing proportional social insurance coverage for flexible work arrangements through the Social Security Corporation. It deepens access to finance by mandating end-to-end digital government payment workflows and rolling out simplified Light Business Accounts to bring micro, small and medium enterprises and self-employed individuals into the formal financial system; modernizes capital markets via amendments to the Securities Law, tax neutrality for mutual funds, and a framework for debt- and equity-based crowdfunding; and strengthens credit infrastructure for cash-flow-based lending by requiring business transaction data reporting to the licensed credit bureau. The operation also enables green and resilient finance by operationalizing the National Green Taxonomy and introducing climate-related disclosure for financial institutions, and it enhances consumer confidence and market development through a modern Insurance Contract Law. Expected results include streamlined sectoral licenses, more effective competition oversight, wider use of electronic notarization, higher participation of micro, small and medium enterprises in public procurement, increased female labor force participation and covered contributors, near-universal digital processing of government outgoing payments, expanded account ownership for underserved businesses, greater private capital mobilization, growth in green lending, and higher insurance penetration with stronger policyholder protection.