November 27, 2017
On behalf of Mr. Shinichi Kitaoka – JICA President, Mr. Kobayashi Tsutomu – Chief of JICA Jordan Office is pleased to present JICA President Award to the Government of Jordan representatives, for Jordan's First Local Sovereign Sukuk Issuance which was closed on the 17th October 2016.
JICA President Award is presented every year to distinctive JICA-supported programmes or achievements selected in strict manner.
Due to the innovative structure and the overwhelming oversubscription in Jordan's first local sovereign sukuk issuance, the award was presented this year to this achievement.
As the award and trophies were presented on 27, November, 2017 to three government representatives; Mr. Omar Malhas - Minister of Finance, Dr. Ziad Fareez - Governor of the Central Bank of Jordan, and Dr. AbdulSalam Abbadi – Chairman of the Central Sharia Supervision Committee, JICA would like to thank the Government of Jordan sukuk teams from the Ministry of Finance, Central Bank of Jordan, Jordan Securities Commission, and the Central Sharia Supervision Committee, where they exerted all efforts for the success of this issuance.
JICA supported this issuance by providing a technical assistance programme to the Government of Jordan, and to that end, JICA appointed the Islamic Corporation for the Development of the Private Sector (ICD) to provide training to the government officials and help them to prepare the related documents and contracts.
In supporting sukuk issuance in Jordan, JICA has helped the Government of Jordan to diversify its debt portfolio, and tap into sukuk as a new method to finance the government capital projects at lower cost. Since the Islamic banks in Jordan enjoy approximately JD 1 billion in excess liquidity (approximately USD 1.4 billion), Sukuk represent a good tool to absorb this excess liquidity to finance the financial gap and for development and investment purposes especially in view of the fact that Islamic banks cannot buy government bonds nor use the overnight deposit window.
JICA's technical assistance for sukuk programme to the Government of Jordan included the provision of training courses in Malaysia and Sudan to the officials from the Central Bank of Jordan, Ministry of Finance and the Jordan Securities Commission. It also included the provision of sharia and legal advice to the Government of Jordan.
This sukuk issuance which was closed on the 17th October 2016 came to finance the completion work of the new Ministry of Finance building. The newly innovated Amortized Ijarah structure was applied for this issuance, which has a tenor of 5 years, and an expected profit rate of 3.01%. 4 local banks participated in this sukuk issuance; the Jordan Islamic Bank, the Islamic International Arab Bank, Safwa Bank (formerly known as Jordan Dubai Bank), and Amman Cairo Bank.