Announcement of First IFC Investment in Jordan One Million Eighty Thousand US Dollars for Ceramic Project on June 21, 1974

FOR· IMMEDIATE RELEASE INTERNATIONAL FINANCE CORPORATION 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IFC Press Release No. 74/15 For use in morning newspapers of Friday, June 21, 1974 First IFC Investment in Jordan $1.8 million for Ceramic Project The International Finance Corporation (IFC) is making its first investment in Jordan with an approximately $1.8 million loan and equity commitment for Jordan Ceramic Industries Company Limited. Jordan Ceramic Industries is a new company sponsored by a group of prominent local businessmen and by Agrob Anlagenbau GmbH, a wholly-owned subsidiary of one of the largest cera.giic producers in the Federal Republic of Germany. The company will build a ceramics factory at Zerka, 15 miles north of Amman, to produce 2,000 tons of sanitary ware-and 4,200 tons of wall tiles annually. The plant will cost an estimated $7.2 million. It will utilize locally available clays and market its products both domestically and abroad. The project, which has been developed by the Government of Jordan in close cooperation with the private sector and IFC, forms an important part of Jordan's comprehensive three-year development plan. Among the prio- rities of the plan are utilization of local natural resources, increase in employment and development of foreign exchange earning industries. The project meets these objectives.  - 2 - •• Jordan Ceramic Industries is sig~ificant in that it is one of the most widely owned companies in Jordan with presently some 2,500 private Middle· Eastern sharepolders c?ntrolling 75 per cent of tpe shares. Agrob Anlagenbau GmbH will be the largest single shareholder owning approximately 15 per cent of the share capital. IFC's equity investment ~11 correspond to 8 per cent of the share capital. The balance of the share capital will be held. by the Government of Jordan. The project will have Jordanian management and assisted by technical. staff from Agrob Anlagenbau GmbH which has assumed overall technical responsi- bility for project implementation and initial operation. Financing .,. The share capital will amount. to 40 per cent of total capitalization. The IFC loan of $1. 6 million will be supplemented by a local cur1·ency loan of $2.6 million ·equivalent from National and Grindlays Bank, Jordan. Union de Banques .Arabes. et Francaises, Paris, is participating in t~e IFC loan. Economic Effects Through import substitution and exports, the project is expected to result in annual foreign exchange benefit of $1.5 million. It will create employment for approximately 200 Jordanians. As Jordan Ceramic Industries will be the first ceramic project in Jord~n it will also introduce new techniques and know-how. Commercial operations are expected to start in early 1976. •