The European Investment Bank (EIB), the European Union's financing institution, announces a EUR 120 million loan to Office National d'Électricité (ONE). The project financed aims to increase the transmission capacity of power interconnectors between Morocco and two neighbouring countries (Spain and Algeria) as well as to make the existing domestic network more secure and reliable.
This EIB loan will in particular serve to double transmission capacity between Morocco and Spain, complementing the Bank's operation in support of the first interconnection between these two countries in 1995.
The project will be co-financed by the African Development Bank (AfDB) and the Agence Française de Développement (AFD), underlining the excellent cooperation between these three major players in the financing of large-scale infrastructure projects in the Mediterranean region.
The projects promoted by ONE will facilitate regional cooperation and integration in the energy sector while increasing the volume of power exchanges between the Maghreb countries and Europe. In addition, by improving the reliability of the national network and expanding the capacity of an existing trans-European network, the project should in the long run assist the liberalisation of the local electricity market.
Since 1978, the EIB has advanced some EUR 2 billion for key projects contributing to the development of the Moroccan economy, such as the first EU-Morocco power grid interconnection via the Strait of Gibraltar, high-voltage electricity transmission facilities and power supplies to rural areas, upgrading of interregional and international telephone networks, and large-scale water management schemes (sewerage systems in several coastal towns, irrigation of farmland in the Doukkala Plain, etc.). The EIB has also helped to finance SMEs in the productive and cooperative sectors through global loans intended particularly for facilitating joint ventures between Moroccan and European operators.
Having provided over EUR 12.6 billion to the Euro-Mediterranean Partnership Countries since 1974, the EIB is especially committed to supporting the efforts of these economies to prepare for market liberalisation with a view to the creation of a free trade zone with the EU by 2010.
In the wake of the Barcelona European Council (15 and 16 March 2002), the EIB will therefore step up its cooperation with the Mediterranean Partner Countries by setting up its new "Facility for Euro-Mediterranean Investment and Partnership" (FEMIP). This facility, officially launched in Barcelona on 18 October 2002, will be endowed with increased financial resources, enabling the EIB gradually to scale up its annual lending activity in the region from EUR 1.5 billion to EUR 2 billion.
In qualitative terms, the new facility will accord priority to financing private sector ventures with the dual aim of liberalising the economy and strengthening competition. FEMIP will likewise focus on social-sector projects, particularly in the fields of health, education and environmental protection, important factors in achieving social stability and encouraging productive investment.