Jordan’s Electricity Distribution Company (EDCO) is to upgrade its distribution network with help from the IFC, the private-sector branch of the World Bank.
EDCO will use $40 million of finance from the IFC to implement an investment plan to improve the availability of electricity and quality of services for customers. The firm was recently privatized by the Jordanian government.
The investment comes at a critical time for the electricity sector in Jordan, with the government expecting EDCO to demonstrate the benefits of public sector reforms. Other electricity companies privatized by the country’s government include the Central Electricity Generating Company (CEGCO), which was sold in 2007.
“This landmark transaction will demonstrate the benefits of public-sector reforms and private-sector participation in electricity distribution to the region,” said Michael Essex, IFC director for the Middle East and North Africa Region.
EDCO will use a portion of the IFC investment proceeds to consolidate its assets in the electricity distribution sector in order to improve efficiency. It has also developed an environmental and social action plan in conjunction with the IFC.
“We appreciate IFC’s support in such a difficult financing environment, as most banks are shying away from lending,” said Mohammed Friehat, EDCO’s managing director. “IFC’s investment in EDCO is an endorsement of our business model and the Jordanian economy.”
EDCO was sold in 2008 to the Kingdom Electricity Company, a consortium of investors from Jordan and Gulf countries.
