The European Investment Bank today formally agreed to provide EUR 5m to the Development Bank of the Seychelles to increase funding available for small and medium sized businesses in the country. The loan from Europe’s long-term lending institution will be matched by the same amount from the Development Bank of the Seychelles. The long-term funding agreement was signed in Victoria by European Investment Bank President Werner Hoyer and Minister for Finance, Trade and Investment Pierre Laporte.

The European Investment Bank has worked closely with the Development Bank of the Seychelles to address challenges facing private sector investment in the region. Loan funding will be available in local currency and target small companies and start-up entrepreneurs. This initiative will be supported by technical assistance to help the Development Bank of the Seychelles’ continued efforts to modernise its governance, credit risk management and financial monitoring. Past European Investment Bank funding for small business in the Seychelles has helped create more than 800 new jobs in 48 firms active in the tourism, manufacturing, fishing and storage sectors.

The head of the European Investment Bank is currently visiting a number of projects in small island states. During his official visit to the Seychelles the European Investment Bank Delegation will meet Vice-President Danny Faure and the Minister of Foreign Affairs to discuss EIB activities in the country as well as seeing at first-hand how past European Investment Bank funding has supported small business investment.

President Hoyer will also meet Minister for Environment and Energy Dr. Rolph Payet and visit the Ile Providence desalination plant funded by the European Investment Bank. Earlier this year the European Investment Bank agreed to provide EUR 27m for investment to improve water and sanitation in the country. This includes funding for planned upgrades to the island’s water network to reduce leakages and help secure year round continuity of supply, and new sewer facilities to reduce risks to the environment and health.

The funding will help the Seychelles Public Utilities Corporation to better manage water shortages through expanding water supply on the 3 main islands and reducing water loss, improving energy efficiency and increasing resilience of water supply to an increasingly uncertain climate and less predictable rainfall patterns. Upgrading of existing sewage facilities on Mahé and construction of new sanitation infrastructure on La Digue will reduce the risk of the contamination of groundwater used for drinking water and environmental risks. The scheme will also contribute to improving environmental and natural disaster risk management, and overall water management through technical support and training with PUC.

The EIB has funded the installation and operation of the first submarine fibre optic cable for international connections to the Seychelles. President Hoyer will also visit the landing site for the 1,930km cable from Mahé to the existing Eastern Africa Submarine Cable System in Tanzania.

The European Investment Bank has been active in the Seychelles since the first credit line to the Development Bank of the Seychelles agreed in 1978. Since then European Investment Bank funding and technical assistance has supported private sector investment, water infrastructure and improved communications.