The European Investment Bank’s (EIB) Facility for Euro-Mediterranean Investment and Partnership (FEMIP) has signed an agreement with Syria, according to which the bank would grant Syria a loan of €200mn.

The loan is for the construction of a 750MW natural gas-fired combined cycle power plant located near the town of Deir Azzour on the Euphrates river in eastern Syria.

According to EIB the agreement would enable Syria to rely on natural gas reserves instead of oil to generate electricity.

Given Syria’s natural gas reserves, the development of a regional gas market offers tremendous opportunities for the economic growth of the country and the region, the EIB claims.

Syria claims to have a clear economic reform plan, promising to undertake several projects within the plan during 2006.