IFC Subnational Investment Helps Improve Infrastructure in Morocco
Morocco, May 2008—IFC, a member of the World Bank Group, has signed a risk- sharing agreement with four local financial institutions to support a priority sewerage investment of the municipal water supply and sanitation and electricity distribution utility in El Jadida, Morocco. This will improve the living standards of the people, while supporting development of tourism and other local industries.
IFC’s involvement with local banks has allowed them to increase the maturity of loans from a 10-year tenor to 15 years. IFC’s investment of up to 150 million Moroccan dirhams (about $20 million equivalent) will help rehabilitate and expand the sewerage collection infrastructure and connect poorer neighborhoods to the network for the first time. This will help reduce health hazards due to the discharge of untreated sewage to surface and coastal waters and the associated pollution of beaches. The loan will also help build new treatment and discharge facilities that will bring El Jadida and surrounding communities up to Morocco’s national standards.
“The investment, the first of its kind for IFC in the Middle East and North Africa, supports a broader World Bank Group strategy to assist the Moroccan authorities in facilitating a disciplined transition of municipalities and their enterprises to market-based financing, without sovereign guarantees,” said Joumana Cobein, IFC Country Officer in Morocco.
The agreement will provide incentives for local water utilities to improve their financial and operating performance, helping them attract commercial financing.
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