Spanish to push for poverty fund

Date: 20/12/01

By David Cronin

SPAIN will be pushing for a new fund for promoting investment in the most impoverished Mediterranean countries during its forthcoming EU presidency, Madrid's main representative in Brussels declared this week.

Ambassador Francisco Xavier Conde de Saro said that a "financial institution" is needed to trigger economic growth because the region had been "left out of the investment circuit". His country's government is finalising ideas about the scheme, with a view to devising a concrete proposal in January. One suggestion is that the fund could work as "a special agency" of the EU's main lending authority, the European Investment Bank.

According to the ambassador, the fund would be designed to encourage small and medium-sized European companies to do business in the region. It would build on the experience gained from the 1,000 Spanish firms operating in Morocco."Spain is willing to put money into this," the ambassador added but no decision has yet been made on what amount it could provide. One official said, though, that a figure of €44 million has been mentioned.

Madrid has been one of the most keen supporters of the so-called Barcelona process. Set up in 1995, it committed the EU to work towards establishing a free trade area with 12 Mediterranean partners, including Egypt, Turkey, Syria, the Palestinian Authority, Israel and Lebanon. Responding to the view held by both EU officials and those in the region's governments that progress towards that goal has not been satisfactory, the Spanish presidency wants planning for the Euro-Med ministerial conference scheduled for next April to give the work fresh impetus.

Conde de Saro also acknowledged that Spain has been handed a formidable challenge in having to chair discussions on what many consider the three most "difficult" thematic chapters in the enlargement talks - agriculture, the future of the EU's budget and regional funding. Although the onset of elections in France and Germany makes the room for manouevre extremely limited, Spain is planning that at least a consensus on how the three chapters should be approached should emerge, with final decisions being taken at a later date.

"With this simplistic but obvious approach, we believe that we should be able to achieve common positions that are acceptable," he said. "Of course, it will difficult but nobody wants to risk the possibility of the whole process derailing."

The Spanish EU Presidency (January-June 2002) is pushing for a new fund to promote investment in the poorest Mediterranean countries as part of the Euro-Med Process.