The European Investment Bank (EIB), the European Union's long-term financing institution, is lending ECU 60 million (1) to Jordan, for upgrading the Aqaba port and financing investments by small and medium size enterprises (SMEs). The loan agreements were signed in Amman by H.E. Dr Rima Khalaf Huneidi, Minister of Planning, Mr Rajab As-Saad, General Manager of the Industrial Development Bank of Jordan, and EIB Director for Lending Operations in the Mediterranean Region, Mr Jean-Louis Biancarelli.
- A loan of ECU 30 million will finance the construction of a two-berth jetty and the purchase of container handling equipment at the Red Sea Port of Aqaba. The upgraded facilities will render operations more efficient, ensuring the strategically important economic role the port plays for Jordan, as it is the country's only seaport. The new jetty is meant to handle industrial bulk goods, whose traffic is expected to grow in the near future, following developments in the mining and chemical industries.
- A second agreement concerns a global loan (2) of ECU 30 million to the Industrial Development Bank of Jordan (IDB) to be utilised to support investments of SMEs in the industrial, tourism and services sectors (3).
Loans have 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.
The European Investment Bank (EIB) was set up in 1958 under the EC Treaty to provide loan finance for capital investment furthering EU objectives. It participates in the implementation of EU co-operation policies towards third countries that have co-operation or association agreements with the Union.The loans signed follow a number of other loans committed by the EIB, making total financing since 1978 in Jordan amount to ECU 340 million, to support projects in water supply and waste water treatment, telecommunications, transport, electricity transmission and distribution, agricultural development and SMEs' industry projects.
(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 September 1997, when ECU 1 = GBP 0.69, IEP 0.76, USD 1.113, Dinar 0.788876.
(2) Global loans are lines of credit made available to banks and other financial intermediaries on a national, regional or local scale, which then onlend the funds, in the form of smaller sub-loans, to support small and medium-scale investment schemes meeting the EIB's eligibility criteria.
(3) In addition, the EIB Board recently approved an ECU 5 million conditional global loan on risk capital resources and a direct equity participation of another ECU 5 million in IDB's share capital, both to be financed out of the European Union (EU) budget under the MEDA Regulation of July 1996. The conditional global loan will finance participations by IDB or by Jordanian operators in the capital of productive enterprises, preferably EU-Jordanian joint ventures.