December 2010 Monthly Report - Eng - Frp2.org

conducted financial analyses as first and crucial steps toward defining the project's financial feasibility, and
to perform the needed legal due diligence, including contractual and legislative work. Accordingly, Mr.
Jarrar will play a pivotal role by ensuring that the consortium's mission will yield the financial format that
suits the GOJ's needs, while achieving the investor's internal rate of return. The Advisor has outlined the
scope of work and major milestones, and has emphasized key areas that project owners must be aware of in
order to make well-informed decisions on the appropriate approach to adopt. The consortium should be
appointed during the first quarter of 2011.
Activity 9: Collaboration with World Bank to conduct Fiscal Impact Analysis for Mega Projects
The USAID-FRP II, and the World Bank have joined forces in December to begin an assignment to
introduce a model for Fiscal Impact Assessment (FIA) for the GOJ's capital projects. The objective is to
formulate a template that can be applied by the GOJ capital project stakeholders to assess the fiscal
ramifications of these projects, including cash-based impact, such as subsidies and capital grants, as well as
future, contingent liabilities. Both parties agreed that the starting point would be mega infrastructure-based
projects, and, accordingly, the National Railway Project was selected as the pilot project for the study. Mr.
Ammar Jarrar has worked closely with the WB mission, and provided them with a conceptual "skeleton"
proposal for the analysis needed. Mr. Jarrar has outlined the areas that need to be covered, specifically, from
the mega projects' perspective. Component C Advisor’s role in the National Railway project's technical
committee proved instrumental while highlighting the aggregates that could carry a significant weight in the
study in terms of being time- and general budget-efficient, since the implementation of mega projects would
most likely be synchronized, leaving little room for error with regards to allocating financial resources.
Activity 10: Contributions to preparatory work done for the Bus Rapid Transit Project
Component C Advisor, Mr. Ammar Jarrar, has also revised the preliminary feasibility analysis, including
traffic projections, carried out by Ministry of Transport Advisor for the Bus Rapid Transit (BRT) Project.
Economic analysis, in particular, was challenged, and a number of recommendations were presented to gear
the analysis towards establishing a sound economic argument, in terms of cost-benefit analysis, among
others. Component C Advisor's work is part of his role as a member in the GOJ technical committee that
oversees and approves the feasibility, financial and other technical work needed to shape the appropriate
packaging of the BRT Project.
Activity 11: Economic Advisory Support to the Capital Project Unit
Component C Advisor, Dr. Abdulhakim Shibli, at the Capital Project Unit (CPU) provided advice to the
head of the CPU, Dr. Hamzah Jaradat, on the following activities:
1) Review and assess the “White Paper on Nuclear Energy in Jordan” report prepared by Worley
Parsons. In particular, to analyze the current and future economic profile of Jordan, the sectoral
contribution to GDP, and the assumptions underlying the socio-economic impact evaluation.
2) Review the proposal to establish the Nuclear Utility Company, submitted by GDF-Suez. The
proposal discusses the option of having two companies: one acting as the owner and other as an
operator. Furthermore, Dr. Shibli is conducting research and contrasting different scenarios
associated from adopting the Paris or Vienna Nuclear Civil Liability Legal Conventions and provide
these recommendations to the Jordanian Atomic Energy Commission (JAEC).
3) Evaluate the “Shareholders Agreement Terms Sheet” for the Jordanian Nuclear Power Plant. This
includes analyzing the role of the government throughout the development phase, the proposed share
of equity, and the required fund raising for all stages of the project.
4) Prepare a chapter to analyze the cost of imported labor on the Central Government Budget, which
will be included in the “Cost of Imported Labor on the Jordanian Economy” Study requested by the
Prime Minister.
USAID-funded Fiscal Reform II Project Monthly Report December 2010 16