The European Investment Bank (EIB), the financing institution of the European Union, announces a further ECU 40 million(1) loan to the Republic of Tunisia for construction of a series of sewerage and sewage disposal facilities designed to improve the quality of life in 19 medium-sized Tunisian towns.

The works financed, which will benefit some 380 000 people, form an essential part of the environmental component of the ninth five-year development plan (1997-2001). They comprise installation of a sewage collection system and construction of a biological treatment plant in each of the 19 towns concerned.

The facilities, which will be built between now and the year 2001 by the National Wastewater Authority (ONAS) under the aegis of the Environment Ministry, will serve to improve the quality of life of local populations and enhance the country's attractiveness as a location for industry and services, especially tourism.

This project follows on from schemes financed by the EIB between 1991 and 1994 for a total of around ECU 50 million and geared to upgrading the sewerage systems in Gabès and eight coastal towns and cities: Tunis, Menzel, Bourguiba, M'saken, Monastir, Kelibia, Medenine and Sousse.

This EIB loan signed under the Euro-Mediterranean Partnership is attracting the 3% interest subsidy provided for environmental projects and financed from the Community budget.

The EIB plays a front-rank role in implementing the European Union's "Euro-Mediterranean Partnership" and achieving its priority objectives. In this context, a new mandate has been established for the period 1997-2000 to finance to the tune of ECU 2 310 million capital projects in the 12 non-member Mediterranean countries which have signed co-operation and/or association agreements with the Union. The Framework Contract governing EIB activity in Tunisia under this mandate was signed in July 1997.Over the past 19 years, the EIB has lent a total of some ECU 700 million in Tunisia to finance projects in the industrial, agricultural processing, transport and environmental sectors. Of this amount, ECU 55.5 million from the Community budget has been made available in the form of loans on special conditions and risk capital operations designed to support the development of SMEs and promote liberalisation of the Mediterranean countries' economies. In particular, ECU 15  million are to be mobilised to strengthen the equity of enterprises undergoing privatisation in order to bolster their capital base, with an identical amount to be given over to consolidating the equity of businesses in the process of upgrading.

(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 31 December 1997, when ECU 1 = TND 1.24.