On May 23rd the European Investment Bank (EIB), the EU's long-term funding institution, announced a EUR30m (US$4om) loan to the State Bank of Mauritius, the country's second-largest commercial bank, to provide long-term finance for the private sector. Part of the funding will be targeted at small and medium-sized enterprises. The EIB gave a similar EUR20m loan in 2005 and more recently provided EUR28m credit for the restructuring of the sugar industry.

This is a further illustration of the role the EU is playing in promoting the development and diversification of Mauritius's economy. It also shows how important it will be for Mauritius to retain the confidence of the EU in its economic policy. This confidence will be weakened by the World Bank's recent Country Partnership Strategy Report, which criticised current government economic policy.