The European Investment Bank (EIB) has recently granted, under its Facility for Euro-Mediterranean Investment and Partnership (FEMIP), a long-term loan to Enda Inter-Arabe in Tunisian dinars for the equivalent of EUR 750 000 (TND 1 250 000). This loan will help Enda Inter-Arabe to finance its growth and to expand its microcredit operations in less favoured areas of Tunisia.

The contract was signed today by Mr Philippe de Fontaine Vive, EIB Vice-President responsible for FEMIP, and Ms Essma Ben Hamida, Co-Director of Enda Inter-Arabe, on the sidelines of the Euro-Mediterranean ECOFIN Council and FEMIP Ministerial Committee meetings taking place on 25 and 26 June in Tunis.

This EIB loan could be accompanied by technical assistance financed by the FEMIP Support Fund from the European Commission's MEDA budget. This would enable Enda Inter-Arabe to strengthen its organisational structures with a view to optimising its growth management and integrating sustainably into the local financial sector.

At the signing of the loan, Mr de Fontaine Vive commented, This project is an excellent example of complementarity between the operations of the Commission and the EIB in the microfinance sector. The Commission's grants have enabled Enda to develop into a profitable microfinance institution, while this EIB loan will help it to continue growing by giving local banks, which still participate only very marginally in its financing, a sign of confidence in Enda's prospects and soundness.

The project is consistent with the objectives set for the EIB with regard to risk capital operations in the MEDA region, i.e. development of the private sector and in particular strengthening of the financial sector in that region.

By assisting the financing of microfirms, EIB support contributes to reducing the vulnerability of many Tunisian micro-entrepreneurs and bolstering private enterprise.

Since Enda Inter-Arabe launched its microcredit programme in 1995, it has advanced TND 59 million (EUR 36 million) in 136 000 microcredit operations. The repayment rate on these operations stands at 99.6%. At present, 30 000 micro-entrepreneurs, more than 85% of which are women, have outstanding loans with Enda Inter-Arabe. They are served through 27 branches located in the Republic's main cities spanning 15 governorates.

Enda Inter-Arabe employs more than 180 permanent staff, most of whom have higher education qualifications and originate from the districts where they work.

Of the roughly 60 institutions providing microcredit in the Arab world, Enda Inter-Arabe is one of only about ten that have achieved self-sufficiency, and hence does not depend on grants.

To finance its growth, Enda Inter-Arabe has therefore started to tap the financial markets and has already obtained loans worth TND 3 million (EUR 1.8 million) from two Tunisian banks. Negotiations are also under way with other banks in the country.