A two-day webinar shed light on the economic challenges and outlooks of countries in the Europe, Middle East, and Africa (EMEA) region, in the pandemic context.
Rabat – In a July 2-3 virtual webinar hosted by Citi, focused on rebuilding economies as they emerge from the COVID-19 crisis, executives from the American financial services provider shared insight on Morocco’s post-pandemic economic outlook.
Morocco’s chances to recover from the COVID-19 crisis
The fifth session of the “Navigating the Future: What’s Next in a Post-COVID-19 World?” webinar targeted the outlook of emerging markets including those in the MENA, with the participation of Citi’s Head of EMEA Emerging Markets, Atiq Rehman.
Rehman began to address Morocco’s chances to recover from the pandemic’s negative repercussions on the economy by highlighting the COVID-19 experience in the country, which he said was managed “very well,” stating that foreign investors should not have concerns about integrating into Moroccan markets again.
He emphasized to Morocco World News the importance of Morocco’s geographic position. The country is well-positioned between Europe and Africa, which opens opportunities for future investments in both continents.
“Morocco has been positioning as a hub between the European and the African countries and we have seen several activities in the financial sector such as Moroccan banks expanding their operations to the African market. This is a business that we support as part of our strategy in the region,” he said.
Rehman also expressed his “positive sentiments” when it comes to areas of investment and future opportunities in the country.
Last month, Morocco’s interministerial commission for investments approved 45 investment projects for a total budget around MAD 23.38 billion ($2.42 billion). The commission approved the projects on June 24 before the head of the Moroccan government, Saad Eddine El Othmani.
The 45 investment projects are expected to generate 3,194 direct jobs and 5,406 indirect positions, of which Morocco is in need following the sharp COVID-19-induced deficit in economic activity. The crisis left 726,000 formal sector employees jobless or temporarily suspended due to the crisis, according to Morocco’s High Commission for Planning (HCP).
Speedy recovery assets
During the same session, Citi’s Head of Turkey, Russia, Ukraine and Kazakhstan (TRUK) and Non-Presence Countries, Grant Carson, explored the requirements markets to recover quickly from the crisis.
Carson sees that the markets that have kept an eye on long-term fiscal initiatives and funding ability, and managed to match them with COVID-19-related policy, are the “ones that will do better.” He also said that “the ones with more diversified economies will do better.”
“Those who have managed the medical impacts of COVID-19, both from hospitals and social welfare, and a funding perspective, would likely do better,” Carson added.
The Moroccan experience in containing the spread of COVID-19 was marked by early intervention in various sectors to contain the virus, allowing the country to look beyond sanitary management and reorient efforts towards industry, namely in the production of protective face masks.
By following strict measures to ensure the safety of Moroccans, factories did not struggle to boost productivity. They were able to cover national demand for protective face masks and export to other countries that suffered from the lack of this necessary equipment.
In the beginning of June, the Moroccan Ministry of Industry announced that Morocco exported over 18.5 million face masks to 11 countries. After securing the domestic market’s demand, Morocco authorized the export of face masks, starting with exports to Europe.
Approximately 33.6% of the exported masks went to France, followed by Portugal with 28.5%, and Spain with 14.6%, according to the ministry.
The industrial move played two major roles in alleviating the intensity of the economic crisis: First by creating a source of revenue, and second by creating jobs and keeping laborers behind the machines.
Morocco’s key sectors
With Citi operating in Morocco since 1967 with a full banking presence through Citibank Maghreb, the company’s officer in Morocco, Taoufik Rabbaa, was able to share suggestions for markets that the North African country targeted for the ongoing economic recovery.
Rabbaa thinks that Morocco has major opportunities to recover from the crisis in sectors such as the automotive industry and aeronautics, in addition to the digital economy, which he described as a major theme.
Morocco’s central bank, Bank Al Maghrib (BAM) announced on June 2 a significant increase in industrial activities during the month of May, after the industrial sector witnessed a production deficit due to the COVID-19 pandemic.
BAM announced that production increased with a capacity utilization rate (TUC) standing at 56% during May compared to 47% in April. In mid-May, the northern city of Tangier saw the resumption of industrial activities including textile, automotive, and aeronautics, which represent the backbone of the country’s economy, next to tourism.
Rabbaa also highlighted the recent digitalization of Moroccan banks, which took place before the pandemic, making it easier for authorities to contain the spread of the virus. “There has been a huge shift in the mindset in terms of digitization in the banking sector way before the COVID19 crisis,” said the Moroccan expert.
“Moroccan banks’ digital services have progressed gradually to offer their clients digital solutions, but more importantly in digitizing core processes such as consumer loans applications, international trade transactions for corporates, and other functions,” he added.
During the COVID-19 crisis, Citi’s affiliate in Morocco, Citibank Maghreb, joined other private and public institutions in making contributions to the Special Fund for the Management and Response to COVID-19. It mobilized resources through corporate social responsibility actions, including providing employees with opportunities to volunteer to support the community and individuals distressed due to the COVID-19 pandemic’s impact.
Citi has been operating in Morocco since 1967 with a full banking presence through Citibank Maghreb, and has been engaged in custody for international accounts investing in securities listed on the Casablanca Stock Exchange. It is the only US bank with a licensed presence operating in Morocco.