A new trend is to be spotted in the European investment bank's activity in the Maghreb region. Its dedicated arm for the Mediterranean, FEMIP, has just signed three operations for large private sector projects with an international reach in Algeria and Tunisia. While FEMIP's objective has always been to promote the private sector as the driving force behind sustainable growth, it is the first time that it is lending to such large-scale projects in key sectors of the economy, which use the best technologies, sophisticated financial structures and meet the highest international standards in terms of mitigating negative impacts on the environment.
- The EIB signs a letter of intention to lend up to 500 million euros to MEDGAZ, the first direct gas pipeline between Algeria and Europe.
The new MEDGAZ pipeline transporting natural gas from Beni Saf in Algeria directly to Spain below the Mediterranean sea will bring substantial financial benefit to Algeria and help to secure a stable and diversified supply of energy in the European Union.
Philippe de Fontaine Vive, vice-president of the EIB, signed today in Barcelona a letter of intention confirming the Bank's commitment to support this key project, with Pedro Miro, President of MEDGAZ SA, a consortium of Algerian and European companies. The letter was signed in Spain on the occasion of a conference organised by the EIB in Barcelona, on the theme "Connecting Europe: Financing mobility and sustainable cities".
- 70 million euros to build a new airport in Enfidha in Tunisia, operated by a private Turkish airport operator, TAV Havalimanları Holding AS, under a concession from the Tunisian state.
On 27th February, FEMIP granted a loan of 70 million euros to the leading Turkish airport operator, TAV Havalimanlari Holding AS, to construct a new airport in Enfidha, some 110 km south of Tunis. The new airport will initially cater for 5 million passengers per year, which is strategic to develop tourism in Tunisia, a priority for the Tunisian Government.
It is the first privately-run international airport in the Maghreb region and the first large-scale Public Private Partnership in Tunisia.
- 130 million euros to "Tunisian Indian Fertilizers" to build a phosphoric acid plant in Skhira in Tunisia
The company "Tunisian Indian Fertilizers" is the first private joint-venture between Tunisian companies and foreign partners in Tunisia. In the present case, the structure involves two state-owned Tunisian companies and two Indian partners, who will respectively extract phosphate rock, process it into fertilisers, and sell it on the Indian market over the next 30 years.
Building a new phosphoric acid plant to process the phosphate rock in Tunisia instead of exporting the raw material, will create more value and increase the international competitiveness of the Tunisian industry. The project is expected to generate substantial export earnings, tax revenues and employment. It incorporates the best international practices in terms of mitigating the negative impact on the environment.
The financial structure of the project is also sophisticated. For the first time ever, the EIB loan will complement a lease provided by an Islamic financier, the Islamic Development Bank.
Note for the editor
FEMIP, the Facility for Euro-Mediterranean Investment and Partnership, is the European Investment's financial arm for the Mediterranean region. Its remit is to promote the development of nine countries: Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Syria, Tunisia and Gaza/West Bank. Its two investment priorities are: support for the private sector, the driving force behind sustainable growth, and the creation of an investment-friendly environment by means of efficient infrastructure and appropriate banking systems. FEMIP has established itself as the main financial partner of the Mediterranean region, with more than EUR 8.5 bn invested since 2002. It also encourages dialogue between the two shores of the Mediterranean, at the institutional level but also with the representatives of the private sector and civil society.