Tunis — The conversion contract of the first tranche of Tunisia's debt worth 30 million euros, about 60 million Tunisian dinars (MTD), into development projects to be carried out in the country's most underprivileged regions was signed Wednesday in Tunis.

The contract was signed by Secretary of State to the European Affairs Touhami Abdouli, on behalf of the Tunisian government, and Regional Advisor for North Africa at the German Credit for Reconstruction Institute (KfW) Christoph Krieger and Mrs. Kristina Laarmann, Director of KfW's new office in Tunis, which will open next August.

According to the agreement, a 20-million-euro amount, i.e., 40 MTD, will fund a project to be carried out by Tunisia's National Water Distribution Utility (SONEDE). It will help supply drinking water to the regions of Gafsa, Tozeur, Kasserine, Kebili, Kef, Siliana, Tataouine, Jendouba, Medenine and Zaghouan.

The second project consists in a waste-water sewerage programme to be achieved by ONAS, by means of 10 million euros (about 20 MTD) out of a total amount of 20 million euros, i.e., 40 MTD. The project will cover the regions of Ben Guerdane, Regueb, Foussana and El-Guettar.

In statement to TAP news agency, Mr. Krieger reminded that KfW, which has been active in Tunisia since the 1960s, is a German development bank operating in 70 countries.

"We run German co-operation funds and receive subsidies from the German government which are not dedicated to private or non-governmental organisations," specified the official, adding that KfW's funds are granted to ministries and institutions carrying out development projects, as is the case for SONEDE and ONAS.

Mr. Abdouli pointed out, for his part, that converting the Tunisian debt owed to Germany (60 million euros) into development projects in the most underprivileged regions will help alleviate Tunisia's financial burden.

This agreement on the first 30-million-euro debt tranche will help Tunisia overcome the increasing challenges it is facing, notably those of employment and regional stability, he added.