By Hafid EL FASSYAfrican Financial Expert
I still remember the Emergence scenario I was expecting for North & West Africa back in 1994 when i started my career in Emerging markets as African & Arab Credit Specialist; I was foreseeing for just the next decade exactly what we were witnessing on “Latam” (latin American) economies at that time.
With the capillarity of neighboring Europe, the emergence of a dynamic and resourceful “Mercosur” (the south American common market organization) in the Maghreb was guaranteed with the Algerian giant as the stabilizing energy foothold and the traditionally Liberal Morocco as the Private Entrepreneurship “perpetuator” for the region, with its Business Institutions still sound, if not virtuous, since its Independence.
Although we need it for planning, experience taught me that long term forecast is issued just to be ignored by fate, at least for its precision: instead of that twin regional emergence on both sides of the Atlantic, Morocco had to seek his salute on his own, and turned to face at 80% towards the EU, just like every other country in the area. All through the years 2000, after the painful enforcement of the World Bank and IMF sponsored S.A.P. (structural adjustment program), the country made a giant leap on the emergence variables, taking them to quasi-European standards: Infrastructures & utilities, housing, Information technology, business friendly institutions, professional formation, fiscal law, banking sector; more important, it reinforced its liberal stance…And it worked !
No one can today deny the effective and ongoing emergence of this economy, still having imperfections (education, justice & corruption, external balance, employment…) but pursuing the promises to fulfill the ambitions of a young king: improving human development ratios and providing to social & economic operators a framework leading to perennial Growth and Progress.
One should be grateful enough to recognize today that nothing could have been achieved without the strong partnerships build with the EU (mainly France) and the US.
During that process of emergence, the country has learned a lot and in some new fields about Governance & Management: local democracy, nationwide infrastructure development, priority resource management, institutional development bodies, foreign currency & investment attraction, equitable multinationals partnership, human development-oriented policies, minimal food & energy accessibility to the weakest…
If Morocco has still to confirm its success in the above departments, its African southern neighbors haven’t yet convinced that they are safely engaged on the same route. A lot has to be shared on these issues key to reaching a pre emergence level for a nation.
Beside the proximity in the development experience between Morocco and its regional Partners, there’s also a determinant cultural similarity to leverage in the structure of society and family.
But the main argument to plead for is the following: taking into consideration the headwinds in the current context of the unfolding Western Economic Depression, the rise of social contestation in the Arab world and the potentially devastating Globalization, the kingdom has lately restated its geo-economical stance, in terms of quantity and quality.
It has realized that there can be no medium term prosperity without a regional harmonization at its southern borders, because staying pegged at the mercy of growth variation in Western countries keeps the kingdom dependent in terms of Growth even in the configuration of comparatively good fundamentals!
The responsibility and opportunity for the kingdom’s geo-economical stance both lie in widening its spectrum of trade & finance with its partners: before focused quasi-exclusively on the West (USA) and North (EU), it has now to broaden its opening by 90 degrees more towards the South.
With strong assets as the bold (but not yet fruitful) FTA’s (Free Trade Agreements) signed with virtually all its major Partners and the development of the appropriate air-sea-ground infrastructures, with also the outrageous good health of its financial sector leading to the Casablanca Financial Center project (a 1Stop1Shop investment platform dedicated to the region), the country is clearly positioning itself as a Trade & Financial hub between North America, Europe, the Middle east and West & Central Africa.
If conducted properly, this repositioning strategy can produce a “win/win/win situation”: win for Morocco, win for the development of its southern partners, and win for western providers & investors looking for safe investments in virtuous development (uncollateralized from their domestic financial turmoil) and not easy to find at home today.
To that end, North, West & Central African partners must pro-actively set an accelerated convergence program for coordinating their economies to better integrate them.
This convergence program could act like a growth & development enhancer and a protection belt from the upcoming lashes of the Depression in which Western nations are slipping in since 2007, and that will still hurt their economies for the most part of the current decade.
