The Green Transition Facility was officially launched in Jordan today, marking a major milestone in the efforts of the European Investment Bank (EIB Global) to expand climate finance across the European Union’s Southern Neighbourhood. The Green Transition Facility (GTF) is EIB Global’s flagship green finance approach in the Southern Neighbourhood, combining long-term funding, risk-sharing, financial incentives and technical assistance to address the persistent barriers MSMEs face in accessing finance for climate action and environmental sustainability. The facility’s launch is being accompanied by the rollout of the EIB’s Green Eligibility Checker – a web-based tool to help banks and enterprises rapidly assess project eligibility for green finance based on the EU taxonomy – in Jordan.

Although micro, small, and medium enterprises (MSMEs) represent the largest share of Jordanian businesses and provide the majority of employment opportunities in the private sector, they still face significant barriers in accessing climate finance. The Green Transition Facility addresses these constraints through a comprehensive de-risking and capacity-building strategy, with Jordan Kuwait Bank leading the way as the first implementing partner in the region.

The portfolio guarantee signed by Jordan Kuwait Bank will de-risk up to $45 million in green loans. Projects will also benefit from the preferential terms of an existing EIB Global loan facility supported by an EU guarantee, which will be amended for this purpose and further enhanced by incentive grants and technical assistance, together exceeding $1 million. The facility will enable Jordan Kuwait Bank to extend more favourable terms to MSMEs investing in renewable energy, energy efficiency, water and wastewater, green mobility and circular economy projects.

The guarantee, financial incentives and technical assistance are being made possible by an €9 million contribution from Germany through the International Climate Initiative (IKI) Trust Fund. “The Green Transition Facility shows how coordinated financial instruments and technical assistance can effectively overcome market failures and unlock climate investments where they are most needed,” said Guido Kemmerling, chargé d’affaires of the German Embassy to Jordan, representing IKI and the German government. “Germany is proud to support Jordan’s private sector in becoming an engine for sustainable growth.”

In parallel with the Green Transition Facility, EIB Global is launching the Green Eligibility Checker in Jordan. This free, web-based tool helps financial intermediaries and enterprises quickly assess whether projects meet EIB Global’s green eligibility criteria, supporting project origination, appraisal and reporting. This open-access platform will strengthen the capacity of financial intermediaries to originate and monitor climate-aligned portfolios. To further support institutions engaging in green finance, EIB Global may provide advisory services to help develop internal climate strategies, improve climate risk disclosures and strengthen institutional capacity.