While participating in the Forum for the Future held in Rabat on 11 December 2004, Mr Philippe de Fontaine Vive, EIB Vice-President with responsibility for FEMIP, signed the finance contract for a second credit line of EUR 10 million for Moroccan microfinance institutions to part-finance the increase in their activity in the presence of Prime Minister Mr Driss Jettou and several members of his government (Mr Fathallah Oualalou, Finance and Privatisation Minister; Mr Mezouar, Minister for Industry, Commerce and Economic Development; Mr Talbi El Alami, Minister attached to the Prime Minister with responsibility for Economic and General Affairs; Mr Hjira, Minister attached to the Prime Minister with responsibility for Housing and Urban Planning; Ms Baddou, Secretary of State to the Minister for Social Development, the Family and Solidarity). This long-term loan, in local currency, is aimed at supporting a large number of small-scale investment projects mounted by customers of these institutions. The operation takes the form of a global loan to the Moroccan association "Al Amana", which is a well-established microcredit player and received an initial credit line in September 2003, since deployed in full.
As one of the leading advocates of microfinance in Morocco and a founder of Al Amana, the Prime Minister welcomed this new operation with FEMIP, highlighting this facility's effectiveness in reducing poverty and inequality and developing private enterprise in fledgling form.
Speaking with reference to the Forum, Mr de Fontaine Vive commented: "Lenders operating in the Region are increasingly keen to coordinate their activities as a means of improving the social well-being of the entire population. To that end, the three leading aid donors - the European Commission, the European Investment Bank and the World Bank - signed a Memorandum of Understanding in May 2004 to formulate an approach to their activities that is complementary at all levels. These three Institutions are already liaising with the International Monetary Fund (IMF) under the umbrella of the Luxembourg Group'. Naturally, the Funds Network unveiled at the Forum for the Future may work in tandem with this group ".
Loans in the Mediterranean Partner Countries (MPCs) are granted under the Facility for Euro-Mediterranean Investment and Partnership (FEMIP). This Facility focuses primarily on nurturing the private sector and financing social and economic infrastructure underpinning this development.
This is the culmination of a partnership between the European Union and its Mediterranean neighbours that goes back more than thirty years and was intensified in the 1990s to underpin the Barcelona Process launched at the Barcelona Conference in November 1995. FEMIP aims to help the MPCs meet the challenges of economic and social modernisation and enhanced regional integration in line with the Wider Europe Neighbourhood Policy and with a view to the establishment of a Euro-Mediterranean free-trade area. It enables Europe to step up its cooperation with the Partner Countries. Thanks to this Facility, with its increased financial resources, the EIB has been able progressively to expand its lending in the region from EUR 1.5 billion to EUR 2 billion annually. FEMIP gives priority to financing private sector ventures, with the dual aim of liberalising the economies of the MPCs and developing their potential in the run-up to the planned creation of an EU/MPC customs union in 2010. It focuses on foreign direct investment and local private sector initiatives as well as social-sector projects, particularly in the fields of health, education and environmental protection, with the aim of fostering social stability and encouraging productive investment.
FEMIP has advanced some EUR 2 billion for large-scale economic infrastructure and private sector projects contributing to the development of the Moroccan economy. Examples of projects financed include 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 inter-regional and international telephone networks, large-scale water management schemes (sanitation in a number of towns, irrigation of farmland in the Doukkala Plain, Haouz, etc.) and development of the country's ports. FEMIP 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.