Annex 1: Council conclusions on the Facility for
Euro-Mediterranean Investment and Partnership: 2766th ECOFIN Council
meeting, Brussels, 28 November 2006
The Council adopted the following conclusions:
"Following the invitation by the European Council
in December 2003, the Ecofin Council has assessed the performance
of the reinforced Facility for Euro-Mediterranean Investment and
Partnership (FEMIP) and its possible evolution taking into account
partner countries' views. The results achieved by the reinforced
FEMIP were evaluated positively, since it has proved to be instrumental
in channelling funding to the Mediterranean region through lending
to private companies and infrastructure investment aiming at enhancing
the business environment.
However, Member States also noted that the effectiveness
of FEMIP could be enhanced further, in particular with respect
to supporting the private sector, especially SMEs, which has not
yet stabilised at the 50%-target of FEMIP activities. At the same
time, Member States agree that the effectiveness of FEMIP also
depends on the business environment in Partner countries becoming
more conducive to private sector development and on regulatory
obstacles in partner countries being removed.
Against this background and the results of the consultations
with the Partner countries, the Council agrees that, at the current
juncture, the best way forward to enhance partnership with Mediterranean
partners is to develop this instrument further with the following
priorities:
- improving the linkages of FEMIP
with the European Neighbourhood Policy (ENP) including by a better
integration of the EIB's activities into the EU country strategies
and by better combining EIB loans and EU budgetary resources.
To this effect, adequate resources should be provided by the Community
budget;
- developing further the FEMIP instruments in order
to overcome the obstacles to more effective financing of the private
sector, in particular SMEs. To this effect:
— the
allocation of risks between FEMIP, local financial intermediaries
and local companies should be improved mainly by encouraging increased
risk-taking by local intermediaries;
— EIB risk-taking should be increased through
a more active use of the Special FEMIP envelope;
— incentives should be provided together
with technical assistance to local intermediaries in order to
make global loans more effective and accessible to SMEs;
— the risk borne by SMEs should be alleviated
through local currency guarantees and loans; and
— risk-capital resources and technical
assistance could be used more often to enhance the quality of
local SME projects and should continue to support activities with
a higher risk profile;
— strengthening partnership and local interaction
notably by creating an advisory committee, including representatives
from Mediterranean countries, to strengthen ownership of partner
countries.
In implementing these priorities, the EIB should
continue to safeguard FEMIP's value added vis-a-vis the market
and other IFIs.
Member States invite partner countries:
- to facilitate private sector
development and encourage structural reforms, in particular financial
sector reform; and
- to commit to closer co-operation with the EIB,
in particular ensure that the EIB can issue bonds in local markets.
The Council will continue to monitor the performance
of FEMIP".
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