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on retail banking have seen a marked improvement in access to financing, both

for consumers ind local businesses. Now, local banks are focused on market

consolidation, while at the same time developing a wider range of products

and introducing more efficient and modern banking technology'

Jawad Hadid, C"hief Executive of lordan Commercial Bank, says that Jordan's

banks have also benefited from the continuous increase in economic activity

and cross-border capital inflows since lordan began on its privatisation program

a decade ago. "0vei the past five years we have seen deposits grow by about

40 %, with" a doubllng in credit'facilities," says Plr. Hadid, adding: "This

An island of stability in a troubled region Jordan is benefiting from the

ambitious agenda of the government of King Abdullah ll. 0ver the last decade

sustained fdreign direct investment (FDl) has driven the economy, resulting

in average GD[growth since 2000 of 6 percent. FDI has doubled-every year

since 20b4, rea-hing $3 billion for 2006. The Jordan lnvestment Board says

that FDI growth for lOOl was 200 percent. Key sectors attracting investment

are consiruction, real estate, tourism, pharmaceuticals, textiles, automotive

parts, and mining. Growing numbers of investors are also locating in the

country's Qualifying lndustriil Zones, Free Zones, and industrial estates. "Jordan

is on the move, says Gerhard Mansbart, General lvlanager of the Meridien

Hotel, in the heart of the capital's business district: "There isabuzz here that

reminds me of Abu Dhabi in the I 980s. New projects are springing up

everylvhere", he adds.

A sound and transparent financial sector Jordan's economy is built on

the twin rocks of judiclous supervision by the authorities and a strong banking

sector - as point"ed out by a recent IMF report that highlighted the central

bank's prudent monetary lrolicy, the healthy foreign exchange market and an

appropriately valued Jordaniandinar The country's I5 domestic commercial

airb tslamic banks and eight foreign banks are well capitalised at more than

20% of assets, while the country is introducing Basel ll capital adequacy

regulations this month that will further strengthen risk management capabilities

and ensure good corporate qovernance.

0ther rec"ent refoims to t"he banking sector have been the introduction of

new financial instruments which, along with increased competition and a focus

lordan and 3 in Palestine. Jordan's bourse has also been attracting billions

of dollars of Arab capital seeking a safe haven in a region of political turmoil,

says lalilTarif, Chief Executive oithe Amman Stock Exchange (ASE), pointing

oui that inflows from regional investors have contributed to a tripling of the

bourse's market capitaliiation since 2003 to $32.4bn. "Economic, legislative,

and structural reforms have been executed with profound care and the

restructuring of the capital markets created a sound and transparent environment

which proteits investors," says Mr. Tarit A new financial centre to be completed

by 2009 will strengthen the ;bility of the ASE which is already linked to the

London Stock Exc6ange to compete with bigger Arab Gulf financial centres

by attracting funds arid listings of Arab firms. "The ASE is committed to the

piinciples of fairness, transparency and efficiency,

Thi: Exchange seeks to provide a strong and secure environment for its

listed securitie; while protecting and guaranteeing the rights of investors,"

says Mr. Tarif, he adds that the absence bf any restrictions on foreign ownersh.ip

his increased the percentage of equity owned by nonJordanians to over 46

% of the market's toial market capitalisation compared with

38 % in 2003.

means that the bankingsector is providing thenecessary funding forJordan's economicactivity."Over the last year,

JCB has begun transforming

its branches into what he

calls points of sale, which

specialise in providingconsumer credit andsoliciting deposits. The bank

now has 27 branches in

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