Moroccan banks still mainly serve an elite clientele
Morocco, Economics, 12/22/1999

Although Morocco's banks have established a stable and modernizing sector, they remain an industry serving the elite and still unable to play the intermediation role required to accelerate economic growth and sufficient jobs, the Financial Times wrote on Monday.

Morocco's financial sector is increasingly at the center of the debate over the country's future, plus the accord, signed with the European Union, aiming to create a Mediterranean free trade zone in 2010, the English business daily said, recalling that Morocco's capital markets-- in particular the Casablanca bourse-- are among the most developed in the Arab world, boasting a system of electronic trading and a $13.5-billion capitalization.

The daily concedes that the stock market has yet to convince Moroccan companies to use it as a preferred mechanism for raising capital.

"Our financial sector remains unable to play its part and finance the economy," Anas Alami, head of research at Upline Securities, a local investment house, told the Financial Times. "We are looking for the emergence of a class of young entrepreneurs, but they need to find ways of financing their projects."

The Moroccan banking industry is just learning to cope with liberalization, the daily said, adding that recent developments made the industry one of the most vibrant in the Arab world.

The daily quotes businessmen as saying that despite this liberalization, the Moroccan banks continue to operate in a protected environment, a privilege they should be made to pay for by financing riskier companies.

"If there is a future it is in small and medium-sized companies," Ahmed Benkirane, first vice president at the confederation of Moroccan employers (CGEM) told the daily.

The daily notes that the government's strategy in the banking industry is to lower interest rates and to promote competition. The paper quotes Fathallah Oualalou, economy and finance minister, as saying that the state is not inclined to give guarantees to the bank.

"We consider that the essential element is to create conditions of competition. The era of an administered economy is over," he said.

Previous Stories:
  Morocco's privatization plans attract international interest   (12/16/1999)
  Privatization program poised to earn Morocco $350 million   (12/14/1999)
  European bank extends Morocco 87 million euros in loans   (12/11/1999)

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