The European Investment Bank (EIB), the European Union's financing institution, announces a loan for ECU 9 million (1) to the Régie Autonome Intercommunale de Distribution d'Eau et d'Electricité de la Chaouia (RADEEC) for financing rehabilitation and extension of the wastewater and stormwater sewer network and construction of a treatment plant in the city of Settat, 75 km south of Casablanca.

Identified by a study funded under the METAP (see below), these works will be implemented by RADEEC up to the year 2003. They will serve to improve the quality of life of 175 000 local inhabitants, who would be provided with a complete treatment system including provision for the least-cost recycling of treated wastewater. They form part of the first stage (1999-2003) of a wide-ranging sewerage programme due to run until 2010, whose aim is to conserve water resources and enhance the country's attractiveness as a location for industry and services, especially tourism.

RADEEC is an industrial and commercial public body which comes under the twin supervisory authority of the Ministries of the Interior and Finance. Its main remit is to provide water and power supplies in the Chaouia region. Since 1998, it has been entrusted with management of the sewerage service by the Municipality of Settat.

This EIB loan signed under the Euro-Mediterranean Partnership represents the Bank's second operation in the Moroccan sewerage sector. It benefits from the 3% interest subsidy financed from EU budgetary resources earmarked for environmental projects. The experience acquired with the previous operation, targeting sewerage schemes for the imperial cities of Fez and Marrakesh, enabled the Bank, in conjunction with the Moroccan authorities and promoters, to establish prerequisites for financing further projects in the sewerage sector on the basis of METAP-funded technical, pricing, environmental and organisational studies.

The EIB is co-manager with the World Bank of the "Mediterranean Environmental Technical Assistance Programme" (METAP) launched in 1990 to assist Mediterranean countries in finding solutions, at national and regional level, to common environmental problems by developing policy options and mobilising grant aid. In 1997, METAP opened a regional office in Cairo. The EIB has to date financed 74 studies for a total ECU 7 million in the Mediterranean region.

The EIB is a lead player in implementing the European Union's "Euro-Mediterranean Partnership" and its priority objectives. The Bank has been entrusted with a mandate for the period 1997-2000 to provide up to ECU 2 310 million of funding for projects in the 12 non-EU Mediterranean countries which have signed cooperation and/or association agreements with the EU. Since 1992, the EIB has contributed around ECU 740 million towards projects of key importance for the Moroccan economy, such as the EU-Morocco power grid interconnection via the Strait of Gibraltar, high-voltage electricity transmission facilities and power supplies to rural areas, improvements to the trunk and international telephone networks and large-scale water management schemes (sewerage systems in coastal towns, irrigation of farmland in the Doukkala plain, etc.). The EIB has also promoted small and medium-sized enterprises in the productive and cooperative sectors through global loans to commercial banks, intended particularly to promote Moroccan/European joint ventures.

(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 September 1998, when ECU 1 = MAD 10.8630.