- MULTILATERAL DEVELOPMENT BANKS’ COLLABORATION: INFRASTRUCTURE INVESTMENT PROJECT BRIEFS Jordan: Queen Alia Airport Overview The Queen Alia Airport is Jordan’s main international airport and a key component of the country’s transport, trade and tourism infrastructure. In 2007, the International Finance Corporation (IFC) served as transaction advisor to the Jordanian government on structur- ing and awarding a 25-year concession to a private sector operator responsible for recon- structing and expanding the airport’s terminal. It was the first successful airport public- private partnership (PPP) in the Middle East. The Islamic Development Bank (IsDB), the International Finance Corporation (IFC), and commercial lenders financed the project. The new terminal was opened in March 2013 and by mid-2014, IFC, with the IsDB, provided and arranged an additional $68 million in loans to finance an expansion of the new termi- nal’s related facilities. This series showcases how the Multilateral Development Banks’ collaboration supports the development and implementation of infrastructure investment. This support comes in the form of public sector loans, private sector finance, sector and transaction advice, guarantees, and output-based aid. - MULTILATERAL DEVELOPMENT BANKS’ COLLABORATION: INFRASTRUCTURE INVESTMENT PROJECT BRIEFS - APRIL 2016 JordanQueenAliaAirport_IFC_IsDB.indd 1 4/7/2016 10:30:56 AM Background In mid-2014, IFC provided a $21 million additional loan and arranged a further $47 million syndication to finance The Queen Alia International Airport (QAIA) is located an expansion of the new terminal’s related facilities to 36 kilometers from the capital, Amman. Built in 1983, it ensure that overall airport capacity continues to meet traffic handled almost all of the country’s air traffic. However, it growth. The Islamic Development Bank participated in did not have the capacity to meet growing demand and it this second financing package, as a co-financier, with a $25 was too old and too small to be expanded. To address these million loan. constraints, the Jordanian government sought a private partner to reconstruct the airport’s terminal and expand Outcomes its facilities. The project was key to supporting the tourism industry, which contributes approximately 10 percent of the • Capacity of the airport will be increased from about 4 country’s GDP. Greater airport capacity was also expected million passengers in 2007 to 12 million passengers by to stimulate trade and drive economic growth. the end of 2016. • With QAIA serving as a regional hub, Jordan’s transport Project Description and tourism industries, regional links, and cross-border trade are expected to grow. The project consisted of the construction of a new terminal • The number of international flights has increased from to replace the existing terminal, expanding the new 120 flights per day from 55 international destinations terminal’s related facilities and operating the entire airport in 2007 to more than 190 daily flights (both arrival and under a 25-year concession. The project aimed at increasing departure combined) from over 60 international destina- the airport’s capacity to handle long-term traffic growth tions in 2015. and establish it as a regional transportation hub. The goal • Over $1 billion in foreign investment, and a substantial of the new terminal project was to improve operations, number of jobs is expected to be generated through the increase quality of service, and serve as a model for other reconstruction and operation of the airport. infrastructure projects in the country. • The PPP resulted in a $700 million investment, 100 Following the successful completion and opening of the percent financed by the private sector new terminal, a second phase to expand the new terminal’s • The PPP has generated significant gains for the public related facilities was launched, with completion expected sector: cumulative $450 million since inception, and an by the end of 2016. The new terminal will cover more annual estimated minimum of $200 million going forward. than 100,000 square meters and the airport will be able to • Since the PPP, the airport has won numerous awards including the 2013 Gold Award for top PPP in Europe, handle 12 million passengers. Central Asia, MENA (IFC/Infrastructure Journal), the ACI Award for 1st rank in the category: Best Improvement by Multilateral Development Banks’ Role Region: Middle East 2013; and ACI’s Best Airport in the In 2007, IFC successfully advised the government of Region: Middle East, 2014. Jordan on a pioneering public-private partnership for • QAIA has become Airport Carbon Accredited, stream- the QAIA. Through a competitive bidding process, lining its activities related to environmental protection. Airport International Group (AIG) was awarded a 25- year concession to construct a new terminal to replace the For more information please contact: existing one, expand the new terminal’s related facilities, World Bank Group: Nadine Ghannam and operate the entire airport. The partnership sought Email: Nsghannam@worldbankgroup.org to address the constraints on the government’s resources. Islamic Development Bank: Fida Rana IFC provided $120 million in loans to AIG and arranging Email: Frana@isdb.org a syndication of $160 million from international banks. The Islamic Development Bank, as a co-financier with IFC, provided a $100 million loan. The new terminal was successfully completed and it opened for traffic in March 2013. Photo Credits Front: Foster + Partners ifc.org @IFC_org isdb.org worldbank.org @WorldBank JordanQueenAliaAirport_IFC_IsDB.indd 2 4/7/2016 10:30:56 AM