GroFin Jordan Client - Arabella for Aluminium

GroFin helps Syrian refugees to rebuild their lives

It is estimated, although nobody knows for sure, that nearly half a million people have lost their lives since the start of the Syrian civil war in 2011. The conflict forced many more – around 5.5 million according to official UNCHR statistics – to flee the country. These refugees escaped immediate danger but for most, the struggle to survive continues.

One of the countries that experienced the greatest influx of Syrian refugees is Jordan. There are over 660 000 Syrian refugees in Jordan registered with the UNCHR, but estimates based on local census data puts the true number at nearly 1.3 million. A recent study by the UNCHR shows that nearly all of them (85%) live below the Jordanian poverty line of $96 per month as they struggle to rebuild their lives in a new country.

GroFin, through its Nomou Jordan Fund, is working to help address the dire need to provide Syrian refugees in the country with sustainable livelihoods. The fund’s mission is to create sustainable impact through serving entrepreneurs in the SME sector with risk capital and business support. The fund has already invested $21 million in 35 businesses since its launch in 2014. This investment sustained 64 jobs for non-Jordanians and included $9 million into 4 non-Jordanian businesses.

Located just a few kilometres away from the Zaatari Refugee Camp, GroFin client Arabella for Aluminium provides much-needed sustainable employment at a decent wage to both Syrians and local workers. Arabella specialises in aluminium extrusion and currently employs 84 workers, including 20 Syrians.

Mohamed Darwish used to be a lawyer before his family fled Syria, but now he counts himself lucky to work at Arabella. “The most important thing about work is to be able to do something useful and secondly we can help to support our families. We cannot predict the future, but we hope it will get better.”

With the support of the Soros Economic Development Fund, Nomou Jordan is increasing its focus on refugees. Over the next two years, it will deploy at least $5 million in additional capital to SMEs owned by, or employing refugees, and will provide them with crucial business support to increase their chances of success. GroFin will also continue to encourage its current clients to employ refugees.

Alfinaz Murad, Investment Executive at GroFin Jordan, says while access to finance is a major challenge for all small and medium-sized businesses in Jordan, refugee entrepreneurs face additional obstacles. “Nationality alone can be a big factor determining whether a financial institution will grant a loan to an entrepreneur. Local borrowers are considered less of a flight risk than Syrians, for example.”

Murad says a lack of collateral is another tremendous obstacle which often prevents Syrian refugees from obtaining financing. “Property is the most widely accepted form of collateral, but restrictions on foreign ownership in Jordan means it is difficult for foreigners to purchase property. For example, there are restrictions on the number of properties Syrians living in Jordan can own, as well as on the use of these properties.”

Syrian-owned businesses also face a higher administrative burden than their local counterparts. “They need to complete much more paperwork than locals to get things. Regulatory risk specific to foreign-owned businesses is also a source of uncertainty as regulations have changed several times,” Murad explains.

Mohamed Hawary, GroFin Investment Director for the MENA region, says business support GroFin provides its clients can go a long way to help refugee entrepreneurs overcome these unique challenges. “We believe that with adequate support and access to finance, refugee-owned businesses can grow and become sustainable to not only uplift refugee communities but also make a positive contribution to the Jordanian economy.”

Click here to read about Al Menber School, a GroFin client providing refugee children with access to education.