The European Investment Bank (EIB), the European Union's long-term financing institution, is lending ECU 30 million (1) to the Egyptian Cement Company (ECC), a joint venture between Egyptian and European partners, for the construction of a plant for the production of grey cement to supply the local market. The loan agreement has been signed by Mr. Nasser Sawiris, Vice President of ECC, and EIB's Director General for Lending Operations outside the European Union, Mr. F. Weber-Krebs, and Director General for Legal Affairs, Mr. A. Morbilli.

ECC is an industrial joint venture established in April 1996 to build and operate the new cement plant. Main shareholders are the private Egyptian group Orascom, who operate in the building and engineering sectors, and the Belgian Holderbel, a subsidiary of the Swiss private Holderbank group, a world leader in cement production. The project will associate Egyptian knowledge of the market and management expertise with the technical know-how and financial input of a major European producer.

The plant will be located 93 km east of Cairo, near the town of Suez and the Red Sea Coast. Its yearly production capacity will be 2.8 millions tons of grey cement, a product used in all types of construction and civil works, whose present demand is larger than domestic production and is expected to grow.

EIB loan has been approved under the new Euro-Med Partnership mandate, which is making available ECU 2,310 million for the period 1997-1999 for financing investment projects in the 12 non-EU Mediterranean countries having signed cooperation or association agreements with the Union. Part of the loan is expected to benefit from a 3% interest rate subsidy from the EU budget, to part-finance pollution abatement facilities, thus ensuring the new cement plant meets international environmental standards.

EIB is owned by the EU Member States. It is active mainly in the EU, but also provides funds in countries outside within the framework of the Union's external co-operation policies. The Bank is a major source of EU financial support for economic development in the region, where it has advanced more than ECU 3.5 billion since 1992 in 12 countries in the southern and eastern rims of the Mediterranean.

(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 June 1997, when ECU 1 = 1.97019 DEM , 0.68 GBP , 6.64 FRF ,1.13 USD,3.93290 EGP.