Brussels, 23/10/2006 (Agence Europe) - The European Commission is proposing to Member States of the EU and Mediterranean partner countries three possible scenarios for ensuring the future financing of the private sector in the Mediterranean. One scenario includes the creation of a Euro-Mediterranean development bank based on the example of the EBRD (Eastern Europe), even though such an option could prove expensive. These three proposals follow an evaluation of the FEMIP (Facilié euro-Méditerranéenne d'investissement et de partenriat) requested by the European Council of Brussels in December 2003 and completed on 17 October this year. This instrument, set up in 2002, had its field of application expanded in November 2003 by the ministerial Euromed conference of Naples and is managed by the EIB. New instruments have been added to it, such as the trust fund, whose role has proved useful in providing assistance to projects funded from other Community resources.
“FEMIP has played an essential role in the channelling of funds towards the region” where investment flows remain “hesitant”. This is due to the relative low rate of growth and, above all, an environment that is not enterprise-friendly, especially with regard to SMEs. Their contribution to economic expansion, however, is essential, underlines the Commission, which explains that in the Mediterranean SMEs account for nearly 70% of jobs and 95% of all companies. The Commission explains that FEMIP intervention has been centred on “financing quality infrastructure, productive equipment and private sector investment”. 77 operations and €7.2bn in direct intervention encouraging project volume worth €25bn had been registered by the end of the evaluation, which also reveals that the EIB is currently the biggest lender in the region. The laborious implementation of neighbourhood policy has not yet allowed for clarification of what lies on the horizon but in the meantime the European Commission is looking at the options and suggesting that either the FEMIP is kept as it is; that it is maintained but with reinforced and diversified instruments where necessary or that it is transformed into a bank and subsidiary of the EIB. This banking institution, called for by many partner countries and Euro-Mediterranean deputies, could “come in a variety of different shapes”. Its advantages will, nevertheless, be counterbalanced by major drawbacks at the same time, in terms of costs (caused by the loss of the fund guarantee, which no longer comes from the Community budget) and the use of heavier management mechanisms. This, the Commission assures us, would be without counting the fact that it would also be necessary to organise an inter-governmental conference to amend the statutes of the EIB. This would appear to suggest that the third option seems more theoretical than practical. (fb)