Hosted by the Prime Minister of Morocco Mr Driss Jettou, the 5th Ministerial Meeting of EIB's Facility for Euro-Mediterranean Investment and Partnership (FEMIP) took place in Skhirat, Morocco on 20 June 2005. The Meeting reviewed the policy issues confronting Mediterranean Partner Countries in their quest for sustained and sustainable growth and development. Ministers in particular focused on water and sanitation issues and the development of the region's transport and banking and financial sectors.

Celebrating the 10th anniversary of the Barcelona Declaration and 2005-Year of the Mediterranean, the Meeting was held under Presidency of the European Union and was twinned with an extraordinary Euro-Mediterranean ECOFIN Meeting (European Economic and Finance Ministers) held on the day before.

The Euro-Med ECOFIN Meeting starting on 19 June was opened and co-chaired by the Moroccan Minister for Finance and Privatisation, Mr Fathallah Oualalou, the Luxembourg Minister of Economy and Foreign Trade, Mr Jeannot Krecké, representing the EU Presidency, as well as the EU Commissioner for Economic and Monetary Affairs, Mr Joaquín Almunia.

The FEMIP Ministerial Meeting was held the following day under the joint chairmanship of Mr Oualalou, and EIB President, Mr Philippe Maystadt, in the presence of Mr Philippe de Fontaine Vive, EIB Vice-President in charge of FEMIP. It was attended by the 25 EU Member States and the 10 Mediterranean Partner Countries, as well as by representatives of the European Commission, the European Central Bank, the European Economic and Social Committee, the International Monetary Fund, the World Bank group and the African Development Bank), and the Arab Monetary Fund.

FEMIP's 5th Ministerial Meeting reaffirmed the strong commitment of 35 European and Mediterranean Finance and Economy Ministers to forge a closer economic and financial partnership and greeted with satisfaction FEMIP's results, presented in its first Annual Report.

EIB President, Mr Maystadt in his opening address stated: In November this year we will for the first time see an Extraordinary High Level Summit of the European and Mediterranean Heads of State and government. Our discussion in the framework of the FEMIP and ECOFIN Ministers Partnership form part of a crucial process in maintaining the impetus for closer economic and political relations in the region. The twinning of the ECOFIN meeting with the annual FEMIP Ministerial Committee highlights the significance of FEMIP, built on over 30 years of EIB activity in financing projects in the Mediterranean. FEMIP is playing a central role in discussions on reform and strategy in the region. With the 10th anniversary of the launch of the Barcelona process, it is now time to take stock of what has been achieved and to prepare a new strategy for the many important challenges which lie ahead.

Mr de Fontaine Vive stated Our 2004 results were a record in EIB activity in the Mediterranean. We channelled EUR 2.2 billion into key investment to sustain development. Over a third went to the private sector. FEMIP's major contribution is building a partnership. We achieved these results together, through a continuous and open dialogue with the political leaders and economic and business experts from all the shores of the Mediterranean, as well as with major multilateral and bilateral donors operating in the region. Our aim is to open the way to encourage and expand private sector investment from both the Partner Countries and the EU in the region. Recent typical FEMIP partnership initiatives include establishment of the FEMIP Trust Fund pledged with more than EUR 30 million from EU Member States and the Commission which broadens the range of financial products available to the private sector, and the Special FEMIP Envelope for increasing support higher risk investment in the region .

The Ministerial Meeting also discussed FEMIP's future orientations to be evaluated at the European Council in December 2006. The Meeting decided that FEMIP should focus on the creation of jobs (in particular through private sector support), the valorisation of human capital (through education) and to contribute to the peace process (by financing key investments in Gaza and West Bank, and regional projects linking all neighbouring countries).

The Ministerial Meeting also approved operational recommendations concerning on water, sanitation and transport, as well as banking and financial sector development, prepared and put forward by the FEMIP Experts Meetings held in Amsterdam and Luxembourg in October 2004 and March 2005 respectively.

Regarding water, sanitation and transport the participants called for:

  • A further improvement of coordination between donors for achieving higher efficiency.
  • The publication of more open tender documents in the case of privatisation or concessions, to reinforce the attractiveness of the countries, particularly when seeking foreign direct investments and to optimise financing costs. FEMIP is to organise a workshop on this issue in Luxembourg in autumn.
  • The development of local currency lending to eliminate exchange risk. Significant progress has been made in discussions with the Kingdom of Morocco to set in place the appropriate framework for a first capital market issuance in Dirham.
  • Preparatory studies to design a regional plan for major logistic platforms. The Assembly of Donors of the FEMIP Trust Fund approved a proposal to analyse logistics needs in the Region, particularly with regard to the creation of logistics platforms to determine the catalytic role they could play in disseminating logistics know-how and establishing whether connecting them as part of a network could help to integrate intermodal supply chains in the Mediterranean more effectively.

Regarding banking and financial sector development, participants called for:

  • More direct support for the reforming efforts in the region. The Assembly of Donors of the FEMIP Trust Fund also approved a proposal to co-finance technical assistance activities with the IMF through the recently inaugurated Middle East Technical Assistance Centre in Beirut, which coordinates relevant activities in a number countries in the region (Egypt, Jordan, Lebanon, Syria and West Bank and Gaza)..
  • Support for the development of the banking and financial sectors in the Mediterranean region. FEMIP, as a major source of financing for small and medium-size enterprises in the region, notably through its so-called global loans credit lines, intends to increase the range of intermediaries having access to its resources. The two first operations under the newly established Special FEMIP Envelope are expected to benefit financing institutions, in Morocco and Lebanon.
  • A Debt Management Handbook for the Mediterranean. This document is due to be made available by the end of the year to help potential investors and other international market participants interested in the region's currency investments. On the occasion of the Ministerial Meeting in Schirat a EUR 80 million loan has been signed for five science and technology parks in Tunisia by Mr Mohamed Jouini, Tunisian Minister of Development and International Cooperation, and Mr de Fontaine Vive.

The finance will support a programme launched by Tunisia's Ministry for Scientific Research, Technology and Skills Development for the infrastructure enabling the establishment and development of five science and technology parks - the technopoles, Sousse, Sfax, Monastir, Bizerte and Sidi Thabet. The technopole concept centers on establishing a link, on a single site, between the activities of research, training and production and to create synergies between them and focusing as follows:

  • Sousse- mechanical engineering and electronics.
  • Sfax - ICT-related activities.
  • Sidi Thabet- biotechnology and pharmaceuticals.
  • Monastir - textiles and clothing.
  • Bizerte - agri-food sector.

Works include establishing transport, water, wastewater, electricity and gas infrastructure. For the preparation of the project a significant Technical Assistance is foreseen under FEMIP.

The next Ministerial Committee will take place in Tunisia during Spring 2006 and will be prepared by an Experts Committee Meeting to be held in Austria.