At a meeting held in Barcelona on 18 October 2002 at the initiative of the European Investment Bank (EIB), the Finance Ministers of the 15 EU Member States and 12 Mediterranean Finance and Economy Ministers of the Partner Countries (MPC) launched the EIB's new Facility for Euro-Mediterranean Investment and Partnership (FEMIP).
This was the first meeting of EU and MPC Finance and Economy Ministers under the Barcelona Process launched in 1995 as a vehicle for cooperation between the Union and its Maghreb and Mashreq partner countries. It provided the occasion for adoption of the new Facility's Business Plan for the coming four years and an initial debate on the opportunities for, and obstacles to, private-sector investment in the MPC.
The MPC will be involved in FEMIP through the creation of an Policy Dialogue and Coordination Committee (PDCC), which will meet twice a year and be composed of representatives of the Finance Ministries of the 15 EU Member States and Finance and Economy Ministers of the 12 Partner Countries. As the body charged with guiding and supervising FEMIP activities, the PDCC will ensure that the Mediterranean Partner Countries have a major input into the implementation of MPC/EU financial and economic cooperation.
Underlining this commitment to forging a stronger partnership, the first session of the PDCC was held on 18 October at ministerial level under the joint chairmanship of Spanish Economy Minister, Rodrigo DE RATO Y FIGAREDO and EIB President, Philippe MAYSTADT, in the presence of Commissioner Pedro SOLBES. Delegates from the World Bank (WB), International Monetary Fund (IMF), International Finance Corporation (IFC) and African Development Bank (AfDB) also participated.
FEMIP: a key development in the Euro-Mediterranean Financial Partnership
This new EIB Facility was set up in response to the conclusions of the Barcelona European Council (15-16 March 2002) and Valencia Euro-Mediterranean Conference (22-23 April 2002). Its objective is to help the Mediterranean Partner Countries meet the challenges of economic and social modernisation and enhanced regional integration, with a view to the planned creation of a free-trade area between Europe and the MPC by 2010.
The Facility represents a major step forward in financial and economic cooperation between the Union and the MPC. Its new priorities are:
- extensive involvement of the MPC in FEMIP policy through the creation of the PDCC which will strengthen efficiency through ownership by Med partner countries and opening of two EIB regional offices, one in the Maghreb and the other in the Mashreq countries;
- focus on development of the wealth- and job-creating private sector, "South-South" regional cooperation projects and investment in human capital;
- greater technical assistance for the design of quality projects and the process of economic reform and privatisation in the MPC;
- deployment of innovative financial products and risk capital;
- gradual increase in the annual volume of EIB activities in the MPC from EUR 1.4 to 2 billion.
The EIB will implement FEMIP in close cooperation with all participants in the region's development: the European Commission, the banking community in Europe and the MPC, multi- and bilateral financial institutions.
By 2006, the EIB plans to invest between EUR 8 and 10 billion in the MPC
The Union's decision to entrust the Bank with this ambitious reform of the Euro-Mediterranean Partnership is underpinned by the EIB's 30 years' experience in the Mediterranean region: since 1974, the Bank has advanced EUR 12.6 billion in long-term loans to non-member Mediterranean countries and, between now and 2006, a further EUR 8-10 billion will be made available to the MPC.
To this end, the EIB has at its disposal funds under the existing Euro-Mediterranean mandates, risk capital resources entrusted to it from the EU budget as well as technical assistance and investment aid funds provided by the Union in application of the decisions of the Barcelona European Council (March 2002).
In implementing FEMIP, the EIB - the EU's financing institution - will draw on its substantial financing capacity (epitomised by its triple A rating on the financial markets and annual business of EUR 37 billion), partnership with the international banking community and renowned experience in project appraisal and monitoring.