The European Investment Bank (EIB), the financing institution of the European Union (EU), announces a loan for EUR 53 million(1), made available under the second Euro-Mediterranean Partnership mandate, to Agence pour la Promotion et le Développement Économique et Social des Provinces et Préfectures du Nord (APDN) for construction and upgrading of rural roads in northern Morocco. The finance contract was signed today in Rabat by EIB Vice-President, Mr Francis Mayer, and the Chief Executive of APDN, Mr Hassan Amrani, in a ceremony presided over by the Prime Minister of Morocco.

The promoter is Direction des Routes et de la Circulation Routière (DRCR), a department of the Planning Ministry. Forming part of the National Rural Roads Programme, the project comprises 61 sub-projects involving 1 344 km of roads in the north of the country. The works will be executed over the period 2000-2004. Since these are not toll roads, the loan will be repaid through the Special Roads Fund, an account, managed by the DRCR, set up to finance maintenance, upkeep and operation of State-run roads.

This is the first operation mounted by the EIB in cooperation with APDN, an agency established in 1995 to coordinate investment initiatives in the country's Northern Provinces, which is strongly supported by EU Member States on account of its role in combating marginal and illicit activities (cannabis growing and smuggling) and illegal emigration, widespread in the region.

The EIB loan will assist development of priority economic infrastructure and help to improve the local population's quality of life, in line with the objectives of the Euro-Mediterranean Partnership policy spelled out by the EU Member States. It will also complement grant aid provided via the European Commission and Spanish and Italian bilateral cooperation for financing various APDN projects.

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 second mandate, this time to provide up to EUR 6 425 million over the period 2000 - 2006 for financing projects in the 12 southern-rim Mediterranean countries which have signed cooperation and/or association agreements with the EU.

Since 1979, the EIB has made available more than EUR 1 500 million for projects of major importance to the Moroccan economy, such as drinking water provision, the EU-Morocco power grid interconnection (achieved by laying a submarine cable under the Strait of Gibraltar), high-voltage electricity transmission facilities within Morocco itself, including power supplies to rural areas, improvements to the trunk and international telephone networks as well as large-scale water management schemes (sewerage and sewage disposal, irrigation of farmland in the Upper Doukkala plain, Haouz etc.). In the rail sector, the EIB recently provided EUR 55 million for financing track realignment and dualling between Sidi Kacem and Fez. The EIB has also promoted small and medium-sized enterprises in the manufacturing and cooperative sectors through global loans to commercial banks, targeted mainly at fostering Moroccan/European joint ventures.

(1) EUR 1 = FRF 6.55957, MAD 9.79.