The European Investment Bank (EIB), the European Union's long-term financing institution, is lending EUR 30 million(1) for expanding existing phosphate production capacity by the development of the second phase of the Eshidya phosphate mine, located in the Southeast of Jordan.
This loan will supplement a previous EIB loan of EUR 30 million in support of the same investment signed in May 1999. It is made available to the Jordan Phosphate Mines Company (JPMC) for engineering, supervision, supply, implementation and mine opening-up, as well as commissioning and operation of the second phase of the Eshidya mining complex. Majority-owned by the Kingdom of Jordan, JPMC is one of the country's largest industrial companies, and possesses the exclusive mining rights for the country's huge phosphate reserves. The investment will increase Jordan's current net phosphate production capacity by 36% and will help consolidate the country's present position as sixth largest world producer of phosphate rocks. By expanding production capacity, It will strengthen the vertical integration with fertiliser producers, so as to maximise the local value-added content. It will therefore improve foreign revenues and create employment opportunities within Jordan's largest industry, which represents over 15% of the country's exports.
The project is being financed by the EIB in cooperation with the Islamic Development Bank and a direct corporate bond issue in the international capital market in Jordan. It is being made available by the EIB under the Euro-Med Partnership agreement, and is part of the EIB's efforts to support the industrial sector in the Middle East, to facilitate the economic transition in preparation for the Free Trade Zone between the EU and the partner Mediterranean countries foreseen for 2010.
The European Investment Bank (EIB) was set up in 1958 under the Treaty of Rome to provide loan finance for capital investment furthering European Union objectives. It participates in the implementation of EU co-operation policies towards third countries that have co-operation or association agreements with the Union. In the Mediterranean region, the EIB operates in the context and support of the Euro-Mediterranean Partnership, adopted in Barcelona in 1995, and which complements the EU Member States' own bilateral co-operation policies.Under the Euro-Med Partnership arrangements, the EIB is committed to lend EUR 6 425 million between 2000 and 2006 for investment projects in 12 non EU-Member Mediterranean countries. In 1999 some EUR 1 billion was committed by the Bank in support of a broad range of investments in the Mediterranean Region.This loan follows a number of other EIB operations in Jordan, making total financing since 1978 in this country more than EUR 500 million, to support projects in water supply and waste water treatment, telecommunications, transport, electricity transmission and distribution, agricultural development and industrial projects, including SME's.
(1) The conversion rates used by the EIB: EUR 1 = 0.613400 GBP; 0.971400 USD; 0.694900 JOD.