Private Sector Development
In spite of the major advances recorded it emerges from the 2011Ã‚Â Doing BusinessÃ‚Â report from the World Bank that Morocco still faces substantial challenges if it is to make lasting improvements to its business climate. It remains at 114th place out of 183, with poor performances under the Ã¢â‚¬Å“starting a businessÃ¢â‚¬Â, Ã¢â‚¬Å“paying taxesÃ¢â‚¬Â, Ã¢â‚¬Å“registering propertyÃ¢â‚¬Â and Ã¢â‚¬Å“getting creditÃ¢â‚¬ÂÃ‚Â headings. On the other hand advances have been made under the Ã¢â‚¬Å“protecting investorsÃ¢â‚¬Â and Ã¢â‚¬Å“closing a businessÃ¢â‚¬Â headings.
After the reforms undertaken over the past decades and the policy of grand structural projects launched recently, the economy was able to show resilience in the face of the 2009 world crisis. Steps were taken to improve access to finance, in particular for small- and medium-sized enterprises (SMEs). These include the implementation of the development plan of the Central Guarantee Fund (Caisse centrale de garantie: CCG) for the period 2009-12; the institution ofseveral guarantee and/or co-financing instruments to accompany sectorial development programmes; and, the creation of theÃ‚Â Emergence InvestÃ‚Â fund aimed at financing the equity or quasi-equity of businesses in the framework of the National Pact for Industrial Emergence (PNEI).
In addition, in order to enable the financial sector toÃ‚Â continue to support economic growth, the authorities undertook major interventions to meet the growing needs of the banks for liquidity and the increase in investment financing needs. These interventions took the form, in particular, of recurrent injections of liquidity by the Bank Al Maghrib, mainly in the form of seven-day advances, and by a lowering of the obligatory reserve rate to 6% in April 2010, which made it possible to provide the banks with financing of MAD 8 billion. The Moroccan financial sector remains healthy and showed solidity in the face of the international financial crisis thanks to the progress made in the area of respect of prudential regulations and to its limited integration into the international financial system.
Furthermore, in 2009, Morocco established the Competition Council to improve the business climate, stimulate economic development and guarantee consumer protection.
In February 2009, the authorities established the Strategic Watch Committee (CVS) to support the sectors hardest hit by the crisis, in particular textiles, leather, and automobile and electronics equipment. This bore fruit, as witnessed by the recovery of these sectors in 2010. The measures taken by the CVS which made it possible to soften the impact of the crisisÃ‚Â on these sectors and on employment and also to prepare businesses for the post-crisis period took a number of forms:Ã‚Â i)Ã‚Â a social component devoted to saving jobs with the state taking over employersÃ¢â‚¬â„¢ contributions and charges for a renewable six-month period;Ã‚Â ii)Ã‚Â a financial dimension involving a reinforcement of the guarantees provided by the state to banks for financing working capital needs;Ã‚Â iii)Ã‚Â a commercial dimension to support the diversification of outlets and markets through taking on board investigation costs and the institution of preferential conditions for export insurance; and,Ã‚Â iv)Ã‚Â a training dimension designed to help businesses shift to products with high added value.
At the end of June 2010, MAD 505 million was made available by the National Social Security Fund (Caisse nationale de la sÃƒÂ©curitÃƒÂ© sociale, CNSS), MAD 725 million was approved by the CCG, MAD 27.8 million wasÃ‚Â reimbursed under support measures relating to the commercial dispositions and 163 certificates of eligibility for the training aid measures were issued in the framework of the training dimension.
Other Recent Developments
Morocco has embarked on a process of redefining the regulatory framework within which public authorities operate as part of the administration reform programme. This programme has two broad thrusts: a review of the missions of central authorities and putting into effect the role of devolved services. The reform was initially implemented on an experimental basis in a number of ministries but has subsequently widened the range of ministries concerned and continued to diminish the weight of the overall wage bill.
In addition, the country has initiated a major project of Ã¢â‚¬Å“advanced regionalisationÃ¢â‚¬Â as part of a more inclusive system of governance based on proximity. This seeks to make public action more effective, targeted and co-ordinated. To this end a form of decentralisation that transfers to the regionÃ¢â‚¬â„¢s administrative, economic and political powers will be implemented.
From 2001 onwards, a reform of the budgetary process was launched to improve the governance of the public finances. It is now well-advanced but still faces many challenges, in particular that the implementation of the various aspects of the reform are extended to all ministerial departments, which requires that all those involved appropriate the reform as their own and must include the devolved services and additional training.
Although there has been progress in public service reform, some black spots remain, and in particular reform of the justice system. The overall reform announced in 2009 had six major components. These were:Ã‚Â i)Ã‚Â a strengthening of the guarantees of the independence of the justice system;Ã‚Â ii)Ã‚Â modernisation of its normative framework;Ã‚Â iii)Ã‚Â upgrading of its structures and human resources;Ã‚Â iv)Ã‚Â improvement in judicial efficiency;Ã‚Â v)Ã‚Â establishment of firm rules governing the morality of justice; andÃ‚Â vi)Ã‚Â optimal implementation of the reform. In light of the importance of this project it has been prioritised in the 2011 budget to speed up its implementation.
To reduce its dependence on energy supplies from abroad Morocco has launched a strategy of diversification of its energy sources with an emphasis on renewables. The aim is to increase the share of renewables (solar, wind, hydraulic) to 42% of electricity production by 2020. Several projects have been initiated, not least the plan to produce solar energy, launched in November 2009 with a budget of USD 9 billion. The integrated wind farm programme has a budget of MADÃ‚Â 31.5 billion.Ã‚Â In June 2010 the wind farm Tangier 1, the biggest in Africa, was inaugurated. Legislation on renewables was adopted in January 2010 and the Moroccan National Solar Energy Agency (Agence marocaine de lÃ¢â‚¬â„¢ÃƒÂ©nergie solaire, MASEN) set up.
In April 2010, the country launched its national strategy for the development of logistics competitiveness, to complement the on-going sectoral strategies. The aim is to cut logistics costs from 20% of GDP to 15% by 2015.
Strengthening and developing transport infrastructure is a key aspect of the countryÃ¢â‚¬â„¢s development. Over ten years, investment in transport infrastructure has increased fourfold to reach a budget of EUR 11 billion for the period 2008-12.Ã‚Â The autoroute network which covers more than 1 000 kilometres today should reach 1 420 km by 2011 and 1 800 km by 2015. In addition, with the aim of reinforcing rail traffic, the country has embarked upon its high-speed line. The first phase will connect Casablanca and Tangier and will be finished in 2013 at a total cost of EURÃ‚Â 1.8Ã‚Â billion. The Rabat tramway should enter service during 2011. Work on the Casablanca tramway began in 2009. Port infrastructure is also making progress with an ambitious investment programme put at MAD 1.9 billion over the 2008-12 period. Morocco was granted two European Investment Bank (EIB) loans in 2010, one of EURÃ‚Â 220Ã‚Â million for the building of 172 kilometres of autoroute between Casablanca and the south-eastern region of Tadla-Azilal with opening planned for June 2013, the other of EURÃ‚Â 200Ã‚Â million for the extension of the port of Tanger-Med with a view to increasing its capacity to 8 million twenty feet equivalents (TEUs).
While the development of water purification infrastructure has fallen well behind the needs of the country, in spite of the efforts made, access to drinking water and electricityÃ‚Â has improved substantially, especially in the countryside. The rate of access to potable water rose from 14% in 2005 to 90% in 2009. At the national level, the rate of individual connections rose from 81% to 96.2% over the same period. Rural electrification was close to 96% in 2009 compared with 22% in 1996.
In the area of information technologies Morocco launched in 2009 a national strategy for the information society and the digital economy called Ã¢â‚¬Å“Maroc Numeric 2013Ã¢â‚¬Â, with a budget of MAD 5.2 billion for the period 2009-13. The strategy aims to speed up the deployment of broadband Internet infrastructures to guarantee access to the largest number, easierÃ‚Â Internet access and the use of information technologies outside the home through the establishment of community access points. Previously, in 2005, the country had initiated the Ã¢â‚¬Å“e-Maroc 2010Ã¢â‚¬Â strategy which made it possible to modernise, diversify and extend telephony and Internet networks and to improve significantly the degree of fixed and mobile telephony penetration and the proportion of households equipped with computers and of households with Internet access.
Natural resources and the environment
Morocco is engaged in a process of environmental preservation and management of natural resources which aims to favourÃ‚Â Ã¢â‚¬Å“greenÃ¢â‚¬Â growth of the economy, in particular through the adoption of the national Charter of the Environment and Sustainable Development (CEDD) and the installation of 16 regional environmental observatories. It has also adopted an institutional, regulatory and financial framework that promotes ecology through a strengthening of its legal arsenal with the promulgation in 1995 of the law on water, legislation on the protection and enhancement of the environment, the law on impact studies, the law relating to combating air pollution and the law on the management and elimination of waste.
Morocco has adopted since 2005 a wide range of environmental and sustainable development programmes, including the national programme for drainage and purification of waste water, the national programme of management of household and related waste, the national programme for environmental improvement of rural schools and the Sebou basin depollution programme.
The country also has an element devoted to sustainable management of resources in the framework of its agricultural strategy called Ã¢â‚¬Å“Plan Maroc VertÃ¢â‚¬Â (PMV), dealing with the improvement of the irrigation system, the encouragement of thrifty irrigation techniques and cultivation systems that use water more resourcefully.
At the end of the 1990s it put in place several financial instruments designed to encourage businesses to sign up to take steps to preserve the environment. These include the national environmental fund (FNE), the industrial depollution fund (Fodep) and the mechanism for clean development (MDP).
Given the strategic importance of the agricultural sector in terms of GDP,Ã‚Â jobs and impact on downstream processing; the country instituted in 2008 the ambitious PMV strategy which seeks to encourage a modern and competitive agriculture over a 10- to 15-year period. It has two chief constituents. The first relates to the development of a modern agriculture with high added value (milk, meat and poultry, citrus fruits, early fruit and vegetables, olives and cereals in particular) relying on private investment through the financing of 700 to 900 projects for a total annual cost of MAD 10 billion to MAD 15 billion. The second focuses on supporting and improving small-scale farming, targeting 600 000 to 800 000 farmers for an overall investment of MAD 15 billion to MAD 20 billion. The announced aim of the PMV is to generate eventually an annual GDP estimated at between MAD 70 billion and MADÃ‚Â 100Ã‚Â billion. For financing the PMV is able to draw on the continuing mobilisation of national and international funds (EU, International Agriculture Development Fund, Millennium Development Goals, African Development Bank [AfDB] etc.).