(MENAFN- Palestine News Network) Ramallah/PNN/
The EBRD and its co-investors the Palestine Investment Fund, Semilla de Olivo and FMO (the Netherlands Development Finance Company) are financing the first Palestinian employment-development impact bond to address high levels of youth unemployment in the West Bank and Gaza.
The project will provide professional training for more than 1,000 young Palestinians to support their transition into sustainable employment.
An estimated 38 per cent of young people in the West Bank and Gaza are unemployed, with a mismatch of skills being a key impediment to their sustained employment. The project is a test case to assess how private sector investment can tackle this challenge by promoting results-oriented employment services.
The investors will provide upfront funding to the project, while the outcome funders, the World Bank and the Palestinian Authority, will repay them if and when the training and employment results are achieved. The project raised US$ 1.8 million in investment and US$ 5.0 million in outcome funds.
Private sector organisations will provide training, starting in 2020. They will focus initially on employment opportunities in the healthcare sector, as well as in the industrial and construction sector. Additional training will be rolled out according to market needs, with the goal of delivering sustainable employment outcomes by late 2021.
Heike Harmgart, the EBRD Director for the eastern Mediterranean region, said: 'We are very proud to launch with our partners the first employment-development impact bond in Ramallah, an innovative financing tool that will help tackle youth unemployment. We aim to provide sustainable jobs to the Palestinian people, thus contributing to the development of their economy.'
Social Finance led the design of the project as an impact bond, as part of the World Bank's Finance for Jobs programme, implemented by DAI Global. Since the first impact bond was created in 2011, more than 140 others have been contracted globally, with an increasing percentage in low-to-middle-income countries.
In 2017, the EBRD started investing in the West Bank and Gaza. To date, five projects have been signed for a total amount of US$ 18 million.
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