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Business Brief: Minister Boussaid Discusses State of the Economy; EBRD Praises Partnership with Morocco; New Auto Manufacturing Facilities Open; and Conference to Match African Start-Ups and Companies to be Hosted by Morocco – Jean R. AbiNader
Jean R. AbiNader
March 6, 2018
Minister of Economy and Finance Mohamed Boussaid was recently interviewed by Oxford Business Group about trending economic developments. He noted that Morocco has signed 55 free trade agreements since 1999 and has increasingly attracted international investment due to its “quality political and economic stability; quality infrastructure and logistical cost reduction; and human capital.” The Minister pointed out that despite having one of the highest public investment rates in the world (30%), the impact has been limited on job creation and rate of growth since most have the projects have been in infrastructure such as tourist facilities, ports, and highways, which are capital intensive, requiring high levels of labor at the construction phase but not for subsequent operations.
Government investments in sectors such as renewable energy have long lead times to be profitable. They generate jobs but the strongest impact in on enabling the private sector access to consistent and reliable power sources and distribution systems that support job creation in new and existing industries.
Regarding government support for small and medium-sized enterprises (SMEs) Minister Boussaid said that while they place a significant role in the economy, most are in the informal sector, with no access to financing and other support needed for growth. For them to be sources of job creation, these companies need to become part of the formal economy, and the government is working on this through a number of programs. Despite these efforts, Boussaid says that much more must be done to integrate SMEs into the country’s economy.
On the importance of the floating exchange regime recently adopted by the Central Bank, the Minister pointed out that this reform will over time make Morocco’s industries more competitive. The government is committed to a prudent exchange rate policy to avoid shocks to the country’s social equilibrium and purchasing power if the value of the dirham fluctuates widely and speculation hurts the economy.
“Morocco is a country of strategic importance for the EBRD,” according to its president Suma Chakrabarti, after a recent visit to Casablanca. The European Bank for Reconstruction and Development (EBRD) has invested over $2 billion in five years of operations in Morocco and he said that “Morocco is now a leader in the region and a key country for the EBRD. We certainly want to do more with Moroccans, here and abroad.” Currently, the EBRD supports around 400 SMEs with business advisory services.
While appreciating the many reforms undertaken by the government, Chakrabarti did not minimize the obstacles. “We are aware of the challenges the country is facing regarding regional inequality and youth unemployment and we are keen to support Morocco in addressing those challenges. We have significantly developed and expanded our program to support small and medium-sized enterprises and we will launch tailored financial program for women and youth.”
According to the EBRD, Morocco is its second-largest country of operations in the southern and eastern Mediterranean region, with $340 million of investment in 2017, invested in supporting small and medium-sized enterprises, regional inclusion, the green economy and capital market development. The Bank has also supported close to 400 Moroccan small and medium-sized enterprises with business advisory services.
Nexteer announces auto plant in Kenitra to manufacture power steering systems and eventually other driveline products. According to the company, “The new 18,000 square meter facility will be the company’s first in Africa and is scheduled for a ground-breaking ceremony in late March. Once the site starts production next year, it will become Nexteer’s 25th plant in its global manufacturing footprint.” Among its existing customers are Renault and PSA, which has manufacturing facilities in Morocco and Nexteer is aiming for the broader African market.
Nexteer is committed to strengthening the local supply chains by growing local industries to provide high-quality components to its manufacturing facility. “Nexteer’s key differentiators include our global manufacturing footprint and our in-house capabilities in producing high-quality, safety-critical steering and driveline systems,” added Boyer. “By establishing a new facility in Morocco, we are strategically aligned with our global customers’ needs.”
Innovative Afrikonnect event to match start-ups with businesses at March event in Casablanca. Hosted by a several investment firms and NGOs working in the entrepreneurial sector, “The two-day symposium aims to introduce the best startups to the African market and help them grow quickly and scale-up on new markets. The event also aims to introduce leading industry players to new growth opportunities through digital mediums, innovation and technology, reported Maghreb Arab Press (MAP) in a story reported in Morocco World News.
According to Social Net Link, the invitation-only event will convene 200 key business operators, including entrepreneurs, business actors, venture capitalists, and innovation experts from French-speaking and African-anglophone countries, as well from the MENA region. “We are proud to announce the first edition of Afrikonnect. This event sees itself as a platform for collaboration to connect major African groups and startups on the one hand, and public and private key actors of the region’s and the continent’s ecosystems on the other hand,” said Kenza Lahlou, co-founder of “StartupYourLife” and Managing Partner of the “Outlierz Ventures.”
A model wastewater treatment facility opens in Aourir commissioned by water treatment services company Biwater. Located near Agadir, Aourir has been growing rapidly with an expanding local population, as well as a thriving tourist industry, so it needed a wastewater treatment facility to meet current and future development needs.
The announcement said that “Biwater has completed the construction of a new wastewater treatment plant that will serve 60,000 local residents and existing hotels. However, the plant has also been built to cater for future needs with a design horizon of 2030 and a total treatment capacity of 20 million quarts per day.” With new hotels being constructed and others planned, the plant will also provide tertiary wastewater treatment for reuse applications.
Biwater Morocco’s country manager Yassine Laib said: “This project sets a new benchmark for Morocco, providing a turnkey wastewater and reuse solution. It has been built in a beautiful town, and as a plant it also looks impressive and in keeping with its surroundings. The water from the plant exceeds treatment quality standards, ensuring that surfers and swimmers on the beaches alongside are not impacted.”