The European Investment Bank (EIB), the European Union's financing institution, announces loans totalling EUR 195 million aimed at promoting the private sector and improving the drinking water supply to the eastern coastal regions of Sahel and Sfax in Tunisia.
EUR 100 million will be devoted to the medium and long-term financing of companies in the manufacturing and service sectors currently in the process of restructuring/upgrading and investing in ventures to expand and modernise their activities. This EIB global loan is open to the entire Tunisian financial sector. Approved Tunisian intermediary banks will be responsible for identifying beneficiary enterprises and will onlend the loan proceeds to investors in local currency. Initially, this credit line will be available to the following financial intermediaries: Amen Bank, Arab Tunisian Bank, Banque de l'Habitat, Banque de Tunisie, Banque de Tunisie et des Emirats d'Investissement, Banque du Sud, Banque Internationale Arabe de Tunisie, Banque Nationale Agricole, Société Tunisienne de Banque and Union Bancaire pour le Commerce et l'Industrie. Five of these banks were intermediaries for the first EIB global loan of this kind, amounting to EUR 50 million and advanced in 1998. It is envisaged that other banks will be involved in the future.
This EIB operation will support the Tunisian public authorities' efforts to foster the development of a more open economy. It is designed to help prepare Tunisian companies for liberalisation of the economy against the backdrop of the progressive establishment of a free trade area with the European Union. It complements the EUR 15 million loan to underpin the privatisation of public enterprises signed in October 1997 and the risk-capital operations mounted by the EIB in 1995, 1997 and 1999 for amounts of EUR 8, 15 and 30 million respectively. This brings total EIB lending in support of the overall programme to upgrade Tunisian enterprises to EUR 218 million.
EUR 95 million granted to Société Nationale d'Exploitation et de Distribution des Eaux (SONEDE) will finance a set of three schemes to supply drinking water to the eastern coastal regions of Sahel and Sfax.
The works financed will be carried out in stages and when completed in 2007 will serve a population of 2.1 million on the east coast. This region has limited water resources but substantial requirements given the levels of farming and tourist activity.
The European Investment Bank is at the forefront of implementing the European Union's "Mediterranean Partnership". Against this background, a mandate has been handed down to the EIB to make available up to EUR 6 425 million over the period 2000-2007 for financing capital projects in the EU's 12 Mediterranean partner countries. The Framework Contract governing the EIB's operations in Tunisia under this mandate was signed in July 1997.
Since launching operations in Tunisia in 1978, the EIB has provided a total of over EUR 1 billion, including EUR 85 million in the form of risk capital drawn from EU budgetary resources, for financing a range of industrial, agricultural processing, transport and environmental projects.