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Green Entrepreneurship in Morocco

Can a Well-Meaning Project do More with Less?

Morocco is a popular topic among US development companies competing for American foreign assistance funding to the North African country. As a major recipient of aid with a hospitable working environment and credible local partners, competition for Morocco-related programs can be quite strong. Sometimes the program themes are obvious: governance, rule of law, maternal and child health care, literacy, and other areas of human and social development.

What has changed dramatically in the past decade, as part of the Administration’s continuation of the Bush legacy of “teaching them to fish,” is the emphasis on economic development through support for private sector engagement, growth, and diversification. Perhaps the best known initiatives over the past 10 years are trade delegations from Morocco to US trade shows, technical assistance to artisanal and crafts organizations, upgrading market access capabilities for Moroccan exporters, and enhancing the regulatory framework to encourage commerce.

Solar power presents opportunities for entrepreneurs

Solar power presents opportunities for entrepreneurs

Most recently, especially since the Arab Spring, is the emphasis on entrepreneurship, clearly the Obama Administration’s legacy in the area of economic development. If one considers the Global Entrepreneurship Summit, held in Morocco in 2014, as the keystone event, there are dozens, if not more, local and regional efforts across the MENA region. A new- vocabulary has emerged that takes terms from Silicon Valley, the finance sector, development, corporate social responsibility, investment, and science to craft a common lexicon to describe entrepreneurship as a process, its content, and the context in which is operates most successfully.

The most recent addition, or one could say “edition,” to aid programs is tying together Free Trade Agreements, environmental pacts, and entrepreneurship. Along with the bilateral FTA, Morocco and the US signed a Joint Statement on Environmental Cooperation in 2006 that includes projects for environmental protection and expanding trade and investment. “The 2014-2017 Plan of Action reflects the current priorities for trade-related environmental cooperation.“

Green Entrepreneurship – Innovation and Social Impact

And so, this summer, the US government released a Request for Proposal (RFP) entitled “Green Entrepreneurship Morocco” (OES-OTO-15-001) whose stated goal is “To support Morocco’s efforts to build a green economy by developing innovative commercial solutions to pressing environmental issues, such as waste management, recycling, and energy efficiency, among others, which not only support the development of Morocco’s entrepreneurial eco-system but also create green jobs.”

Consistent with its goal to innovate cross-cutting programs, the RFP notes that “The recipient will help spur green business and job growth through strategies such as the formation of collaboration partnerships and networks, education and training, innovation, and/or green technology transfers, among others.” It sets a high bar in that “Proposals should demonstrate creativity, substance, and relevance to OES’s [The Bureau of Oceans and International Environmental and Scientific Affairs] goal of promoting sustainable economic growth that integrates environmental concerns.”

The amount for this program is up to $250,000 for 24-36 months, and the menu of anticipated results in the RPF include: new green businesses that are sustainable; related jobs for youth and women; quantifiable impact environmental results; capacity-building of local actors; innovative partnerships for continued growth; increased technical capacity in target areas of green applications; and greater commercial activity in various areas of the green economy.

Supporting Entrepreneurs to Stay Local

What is notable about this green entrepreneurship effort is that it expands beyond the typical areas of entrepreneurship, which have a strong bias towards IT and technology applied to the e-economy. And there is news on that front as well.

A recent article by the ever-interesting Aline Mayard focuses on the latest progress in building a

House of Geeks - Agadir

House of Geeks – Agadir

supportive environment for budding entrepreneurs. Much like the traditional incubators that provide services needed to move from concept to start-up, this “House of Geeks” provides housing along with the elements needed to foster innovation, collaboration, development, and launching of new tech projects.

Located in Agadir, a famed tourist destination in Morocco, the house contains “a makerlab, a gaming lounge, a book area; on the rooftop is a terrace for yoga and reading; and each floor has apartments for the developers.” Created by two Frenchmen, Kamel Magour and Damian Le Nouaille, their mission is “to convince the most talented of Moroccans to stay and work in their country, and to provide them with the means to become resilient entrepreneurs who will find the solutions that will benefit Africa.”

They chose Agadir for its proximity to potential markets in Africa as well as its supportive environment as they believe it is important to develop emotional intelligence, leadership, and entrepreneurship among engineers and developers who have the passion but may not have found a hospitable work opportunity.

Mayard writes, “A large part of Morocco’s talented graduates leave the country, according to Magour, because management style doesn’t match what they’re looking for, the technologies they use are too old, or opportunities are simply not interesting enough. And those who stay rarely gets to choose jobs they are passionate about because their families need them to find a well-paying job fast.” The House of Geeks provides an alternative that is attracting skilled and passionate entrepreneurs who are already making their mark in business.

With growing opportunities such as Green Entrepreneurship and similar efforts underway to better utilize digital technology in the agriculture sector, Morocco is seeing dividends for its investments in infrastructure and education for new technologies.

After the US Africa Leaders Summit: Key Challenge is Making Good on Promises

In a recent article published in Yale Global Online, Dr. J. Peter Pham, Director of the Africa Center at the Atlantic Council, concluded that “Whether [a recurring US-Africa Leaders Summit] happens or not depends on the Obama administration’s stewardship of the initiatives showcased during the summit, including the ability to work with Congress to authorize and fund projects, and also on whether the momentum of the gathering is sufficient to shift the Africa narrative in the minds of American decision makers and the general public who will influence policy and business decisions in the years ahead.”

This is the key challenge facing the Obama Administration – can it make good on the proposed initiatives announced during the Summit, or will the agenda of noteworthy programs fall prey to gridlock in Congress and a distracted Administration? Bipartisan recognition of the importance of more aggressively addressing opportunities in Africa – foreign policy and economic efforts included – was previewed in advance of the Summit by The Heritage Foundation in an issue brief, “Congress Should Upgrade the African Growth and Opportunity Act.”

AGOA Report Brookings African Growth Initiative

AGOA Report Brookings African Growth Initiative

Commonly referred to as AGOA, the current legislation expires September 30, 2015, and Congress is moving slowly towards renewing the law, which provides duty-free access for many African products to the US market. In return, countries are certified for AGOA eligibility if they continue progress towards a market-based economic system, implement democratic reforms including rule of law and human rights protections, and show improvement in their human development indicators. Unfortunately, AGOA only applies to sub-Saharan African countries, thus requiring another set of incentives for the Maghreb/North Africa.

Why Not Broaden the Summit To-Do List?

It is important to repeat the last point – much of what is being proposed for Africa by the Heritage Foundation and the US Government applies only to sub-Saharan Africa (SSA); and this remnant of old-school labeling of Africa ignores important trade and investment trends emerging across West and East Africa in particular. For example, as detailed in the Atlantic Council’s paper on Morocco’s multiple ties to Africa, which launched just in advance of the Summit, Morocco is broadening and deepening its historic ties to Francophone and adjacent regions of Africa through investments and trade, encouraged by King Mohammed VI as part of his economic diplomacy. But when the Heritage Foundation talks about the need to upgrade AGOA, it only looks at the African Union (AU), which has its own internal contradictions that can stand in the way of promoting greater integration of any kind.

That is not to say that Heritage’s recommendations are not critical; thoughtful analysts agree that the five goals mentioned are vital to AGOA’s success: extend AGOA for at least 10 years, encourage regional economic integration, provide additional incentives, facilitate greater bilateral private sector engagement, and support an FTA among African countries.

By not including North Africa, however, the paper overlooks key facts: Morocco is the second largest African investor in

Morocco's growing exports targeted for greater government support

Morocco’s growing exports targeted for greater government support

Africa; it is the only country in Africa that has an FTA with the US, which includes incentives to link with AGOA counties; it has one of the most robust transportation systems in the region; its power generation strategy complements plans for electrification of underserved areas in SSA; and its network of companies investing in Africa is an excellent conduit for foreign companies basing operations in Morocco to conduct trade and investment in Africa. Other Maghreb countries also have much to offer – from utilizing traditional south-south trade routes to encourage greater market integration and ease of the movement of goods and capital, to achieving economies of scale in the discovery, management, and transmission of hydrocarbons.

How to Make Promises into Realities

Enacting the US-Africa Leaders post-Summit agenda depends in large part on securing support from Congress, most immediately for the AGOA renewal/expansion and funding for announced initiatives. Related, but not on the agenda, is renewing funding for EX-IM Bank, a critical cog in America’s trade and investment strategy. For example, the US has promised an additional $300 million a year to promote Power Africa – to double access to electricity across SSA. Funding is to come from EX-IM, which may disappear if Congress doesn’t act. To support US exports and investments, a new seven billion dollars in financing for the Doing Business in Africa Campaign was announced, again with no clear inclusion of North Africa. The Millennium Challenge Corporation and others will also be playing a major part in fulfilling the Administration’s promises, with no clear indication that Congress is on board.

It will be challenging for the Administration to undertake its ambitious agenda without the cooperation of the Congress; but Congress itself held a very active event with the African delegations during the Summit. So, the goodwill appears to be rising for ramping up Africa-US ties across the board. Whether or not this can be kept on track and develop sufficient momentum will be indicated first of all by Congressional actions on AGOA and EX-IM Bank. This is a defining moment in US-Africa relations, and it should include all of Africa and benefit from the experience of those who are making regional economic integration a reality.

Note to State Department: Treat our Ally as a Partner, not a Liability

Why Can’t the US have a Consistent Voice on the Western Sahara?

Two events, separated by an ocean and it seems a universe, occurred recently that provided an opportunity for the US to enhance its foreign policy credibility. It is interesting to see how the State Department is attempting to reconcile its seemingly uncertain position on Morocco’s autonomy proposal for the Western Sahara with the growing international consensus that the autonomy is a potential solution for achieving self-determination for the region. It is all the more confusing majorities in both Houses of Congress and three consecutive administrations have called the autonomy proposal “serious, realistic, and credible.”

Strategic Dialogue Sets the Tone

The first event was the second US-Morocco Strategic Dialogue held April 4 and 5 in Morocco. Secretary Kerry led from the US side. It was a really remarkable visit. He jointly chaired the Strategic Dialogue with Foreign Minister Salaheddine Mezouar; visited with leaders of Parliament and staff at the US Embassy; and presided over the swearing-in of the most recent group of Peace Corps volunteers assigned to Morocco. It was a prolonged love fest, visibly demonstrating why the two allies hold each other in such high regard.

Secretary John Kerry meets with Morocco's King Mohammed VI

Secretary John Kerry meets with Morocco’s King Mohammed VI

And statements words from both sides echoed the strong ties expressed by King Mohammed VI and President Obama during the King’s visit in November 2013. In his opening remarks, Secretary Kerry noted “We are here today to help shape a common future, and it’s a future defined by a shared prosperity and shared security that we can create together…and shared…values.” In speaking about security issues Kerry commented “The United States stands by and will stand by this relationship every step of the way. President Obama is deeply committed to that, and that commitment comes from…our people.”

Foreign Minister Mezouar was equally eloquent. In addressing the Western Sahara he said:

“The Moroccan initiative in its content reacts to the expectations of the people in the Sahara in the management of their own affairs, which guarantees dignity, freedom, and development.” He went on “The atmosphere of an understanding – of the environment of understanding based on common political and references of democracy and human rights makes us believe in our ability for a common partnership…that will be very important and decisive in determining the progress in this region and in Africa.”

The joint statement at the conclusion of the Strategic Dialogue was quite specific in defining the parameters of this partnership. Whether in reference to human rights and political reforms, civil society and immigration issues, or economic cooperation and cultural and educational cooperation, the tone was serious, constructive, and hopeful. On the regional level, the two parties pledged “to use our strategic partnership to advance shared priorities of a stable, democratic, and prosperous Maghreb, Africa, and Middle East.” Secretary Kerry “Reaffirmed our commitment to a peaceful, sustainable, mutually agreed-upon solution to the Western Sahara question…The United States has made clear that Morocco’s autonomy plan is serious, realistic, and credible, and that it represents a potential approach that could satisfy the aspirations of the people in the Western Sahara to runt their own affairs in peace and dignity. Furthermore, “The Secretary welcomed the recent actions and initiatives by Morocco to continue to protect and promote human rights in the territory.”

So What’s Up at State?

The second event occurred on April 9 when the House Subcommittee on the Middle East and North Africa asked representatives from the State Department and USAID to address “U.S. Policy Toward Morocco.”

After complimenting Morocco on its efforts in democratic and economic reforms, Deputy Assistant Secretary of State for Near Eastern Affairs, William Roebuck, addressed the Western Sahara issue using similar language to Secretary Kerry in Morocco supporting “the United Nations-led process designed to bring about a peaceful, sustainable, and mutually-acceptable solution to the Western Sahara question.”

In reference to the 2014 Appropriations law enabling Title III funding to be spent anywhere in Morocco, DAS Roebuck noted that spending US funds in the Western Sahara would somehow undermine the non-going negotiations, which have been dormant for years. There is clearly a disconnect between what some at the State Department promote as US interests and the position taken by the Bush, Clinton, and Obama Administrations and majorities of Congress that the autonomy plan is the only way forward.

In her prepared remarks, Alina Romanowski, Deputy Assistant Administrator at the Middle East USAID Bureau was equally narrowly focused on existing initiatives with no reference to the Appropriations mandate. This would be understandable if this was a debate 20+ years ago when the first UN mission was assigned on a referendum mission. US policy changed in 2006 in favor of a negotiated, mutually acceptable political solution. The only proposition that emerged from that step is the Morocco autonomy initiative referenced by Chair Ros-Lehtinen and other members of the Subcommittee. Yet, there are those at State who can overlook the humanitarian and capacity-building needs of the people of the Sahara and stay the 1991 course of inaction.

It’s past time to enable the people of the Western Sahara to build their capacity to enjoy the autonomy promised by Morocco to manage their affairs as promised within the regionalization proposed in Morocco’s 2011 Constitution. Morocco is a steadfast and willing partner in a region where that kind of ally is in short supply. If we are sincerely interested in the human, social, economic, and political development of the Sahara, autonomy supported by the US and the global community is the way forward; this will be the best antidote to insecurity in the region. This will give them the dignity the people in the Sahara deserve.

USAID Expands Civil Society Capacity Building Programs in Morocco: Part 2

In my previous posting, I previewed some of the key features related to youth employment programs in the recently announced Country Development Cooperation Strategy (CDCS) 2013-2017 for Morocco launched by USAID during the November visit of His Majesty King Mohammed VI with President Obama.

The major sections of the strategy with the relevant goals and objectives are:

 CDCS Goal: Advance Moroccan initiatives for peaceful reform

Development Objective 1: Employability of target youth enhanced

  • Access to quality employability services improved
  • Improved alignment of workforce programs to market needs

Development Objective 2: Increased Civic Participation in Governance

  • More responsive and representative political parties
  • Civil society contribution to public policy increased

Development Objective 3: Enhanced educational attainment for children at primary level

  • Reading skills of primary level students improved
  • Learning delivery systems improved

Youth employment efforts include providing mechanisms for increased data and metrics to assess training efforts being made by the government, NGOs, and the private sector; more programs focused on enabling women and youth to acquire market-ready skills; and greater stakeholder engagement to “collaborate with the Ministry of Employment and other relevant actors in identifying and advancing creative and flexible working arrangements that incentivize the hiring of Moroccan youth.”

In the section on increased civic participation, USAID mentions its long-time support for civil society in Morocco and its assessment that the quickening pace of political reforms opens additional space for public policy engagement. Its particular focus is on enabling civil society, especially the political parties, to play a more robust and responsible role as outlined in the 2011 Constitution.

Engaging civil society in building Morocco’s future

As the CDCS notes, “Article 12 of the new Moroccan Constitution states that “The associations [and NGOs] interested in public matters … contribute, within the framework of participative democracy, in the enactment, the implementation and the evaluation of the decisions and the initiatives of the elected institutions and of the public powers.” Given this mandate, “Thus, civil society and political parties are now constitutionally empowered to participate in governance. By increasing the capacity of civil society to engage the government on behalf of citizens and facilitating the development of institutionalized mechanisms of civic participation in government decision-making, Morocco will be better situated to implement its reform agenda in a peaceful and sustainable manner.”

The key targets defined by USAID for capacity building are women, NGOs, and political parties. It bases its priorities on the initiatives included in the 2011 Constitution as well as the public’s simmering dissatisfaction with the political parties. As the report notes: “Moroccan citizens have long been detached from political parties due to a lack of clear policy vision or consideration for citizen involvement, particularly by women and youth, in public-policy making.” To repair this situation, “USAID will help political parties to improve their credibility by increasing the transparency and accountability of their internal operations, developing platforms reflective of citizen needs, and enhancing the involvement and leadership of youth and women in politics.”

Among the various tools that USAID has defined as part of its agenda with political parties are “the effective use of public opinion to inform policy agendas, the development of youth and women branches at the national and local levels and the development of individual plans to strengthen internal party capacity.” It is critical to Morocco’s reform aspirations that political parties become more focused on building constituencies that coalesce around specific political platforms that address local, regional, and national issues, as well as facilitate greater inclusiveness across age, gender, and ethnic lines.

The CDCS is in many ways an affirmation of the long-standing friendship and cooperation between Morocco and the US.

It also highlights the central importance of implementing the initiatives in the 2011 Constitution for broadening citizen participation in public policy making, including regionalization, enhanced roles for women and youth, and increased stakeholder engagement across all areas of human development.

While other North African states are struggling to maintain secure and safe public spaces, Morocco is moving ahead with its second decade of political reforms. Its results to date have earned support from the US and the international community, and the CDCS and other agreements both confirm Morocco’s path and offer partnerships to proactively move ahead.

US partnering with Morocco to support its human development – Part 1

What better way to start a new year than to review events of the last quarter and see what the indicators tell us about how Morocco is progressing. The highlight of 2013 was, of course, the meeting in November between President Obama and King Mohammed VI to renew and upgrade the bilateral partnership. The well-crafted diplomatic statement that was released detailed modes of cooperation and coordination between the two long-time allies, and several agreements were signed or announced that defined the way forward.

One of the agreements that addresses key issues discussed by the King and President Obama is the USAID Country Development Cooperation Strategy (CDCS) 2013-2017, which describes how USAID will help support Morocco’s efforts “to improve workforce development practices, enhance citizen participation and increase the quality of primary education.” Some useful facts: the first US economic assistance agreement with Morocco was signed on April 2, 1957; the CDCS —is part of the larger framework of the US-Morocco Strategic Dialogue launched on September 13, 2012. “one of only six such bilateral agreements in existence.”

Supporting the reform agenda

There are numerous references in the CDCS to the importance of Morocco’s reform agenda and the constructive actions of King Mohammed VI in response to the Arab Spring. It points out that while the entire region experienced some level of unrest, “a reformist constitution and strong political will have positively positioned Morocco for accelerating progress towards development goals.” The CDCS places continued political reform at the center of Morocco’s development agenda and welcomes the dynamic link between reform and progress that is evident in Morocco’s 2011 Constitution. “Given this unprecedented democratic opening, Morocco is well positioned to make significant improvements to democratic processes, allowing the country to implement its reform agenda in a pluralistic and sustainable manner.”

The momentum of political reform includes broadening opportunities for greater civic engagement by Moroccans at all levels, complemented by increased economic activity that deals with the central issues of unemployment and market related education. For most of the last decade, Morocco’s economic performance has been steady, and the CDCS links continued political progress and sustained economic growth. “Implementing the needed reforms to create more inclusive growth is therefore essential to preserving solid economic performance in a challenging external environment.”

The Moroccan economy has been negatively impacted over the past three years by the decline of investments from and exports to the Eurozone, as well as fewer remittances from Moroccans working abroad. To offset these trends, Morocco is greatly expanding its presence in Africa and broadening its development agenda to support greater political and economic participation. And it is in the areas of employment promotion, greater opportunities for women, capacity building for civil society, and political party reform that USAID is poised to make important contributions under the new plan.

USAID focuses on short and medium-term workforce empowerment

As detailed in the CDCS, USAID believes that it can work with partners throughout the country to help reach Morocco’s development goals. “Due to the experience of past projects in Morocco and civic participation best practices from work done around the world, USAID is in a unique position to help Moroccan Civil Society Organizations (CSO) and public institutions nurture civic participation in public decision-making during this critical juncture in Morocco’s democratic evolution. From issues of workforce development to civil society capacity building, USAID has worked with stakeholders throughout Morocco to define a multifaceted strategy on the issues of employment and capacity building.

“USAID is proposing to enhance youth employability by focusing on the transition from education to employment for university and vocational students and recent graduates. The Mission will take an integrative approach to help Morocco adopt demand-led education and training systems that are both flexible and aligned to high-impact sectors and industries.” Projects described in the CDCS supplement existing programs, collaborate with a variety of stakeholders, and have a particular focus on raising opportunities for women. Among its many efforts, “USAID will work closely with the Ministry of Employment to strengthen its planning and monitoring and evaluation capabilities, while advocating for flexible hiring practices beneficial to youth.” Rather than focus on specific sectors, which is being done by other donors, government agencies, and private industry, USAID resources will target potential employees regardless of their industry or service.

Drawing on its global experience, communicating broadly and collaborating with stakeholders, providing data and metrics that will facilitate best and sustainable practices and taking an integrated strategy in delivering its programs and projects will enable USAID and Mission Director Dana Mansuri to further enhance their effectiveness as proactive partners in Morocco’s development.

US plan to Power Africa can benefit from Morocco’s renewable energy

On his recent trip to Africa, President Barack Obama announced his Power Africa initiative to spend $7 billion over 5 years to fund an electricity program in sub-Saharan Africa that includes geothermal, hydro, wind, and solar power.

Critics have attacked the plan from all directions: it is too small and doesn’t involve a long-term commitment; it doesn’t give enough attention to solar power; it doesn’t deal with distribution issues; and it doesn’t bring enough focus on cleaning up conditions that keep the global private power industry wary of investing in Africa—“poorly enforced property rights, corruption, and patchy enforcement of the rule of law.”

Yet no one denies the need as nearly 590 million people lack access to power in sub-Saharan Africa. Ironically, “indoor air pollution from wood stoves now kills 3.5 million people per year, more than AIDS and malaria combined.” In some cases, US regulations will have to be changed to support the project because some environmental rules restrict OPIC funding for projects that emit greenhouse gases. And due to the rural locations of many of those in need, renewable power, according to the International Energy Agency, “could be the most cost-effective option for expanding energy access in about 70 percent of rural areas in developing countries.” One solution already provided by the US company SKYei, is the installation of mini-grids powered by a hybrid of solar and gas that are inexpensive and well suited to rural areas. So far, Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania have signed up for the first round of projects. Andrew Mayock of the Millennium Challenge Corporation (MCC) believes that the initial fund of $7 billion, which has already attracted an additional $9 billion in commitments from private sector investors, could grow to $30 billion in energy infrastructure investments annually.

Morocco and WAPP – where the roadmap is already en route

While Power Africa moves forward, there are burgeoning opportunities across the continent in central and west Africa. The Economic Community of West African States (ECOWAS), through its West Africa Power Pool (WAPP), has made regional power grid access a priority for the next decade. WAPP intends to integrate the various national power systems “into a unified regional electricity market – with the expectation that such mechanism would, over the medium to long-term, assure the citizens of ECOWAS Member States a stable and reliable electricity supply at affordable costs…facilitating the balanced development of diverse energy resources…for their collective economic benefit, through long term energy sector cooperation, unimpeded energy transit and increasing cross-border electricity trade.”

It should come as no surprise that Morocco is a significant player in WAPP through its close ties to ECOWAS and revived leadership of The Community of Sahel-Saharan States (CEN-SAD). More importantly, Morocco is a strong partner for energy development due to its dominant role in Africa in investing in renewable energies; its success in bringing electricity to 98% of its rural areas; and the logistical ties that exist between Morocco and the countries in Central and West Africa.

As this illustration from the African Development Bank indicates, trends in energy consumption and production favor a strong regional grid between Morocco and its neighbors to the south. Given the expanding utilization of its national resources for local projects, the region is collectively demanding more efficient and productive investment in all types of infrastructure. With this strong commitment to economic and human development, more reliable energy supplies are a core requirement. Reliable energy is an enabler and multiplier of opportunities across many sectors and is a key driver in attracting foreign direct investment, creating jobs and enhancing stability.

”The development of Africa’s electrical power sector is a prerequisite for growth in other industries. A regular, consistent power supply will do much to attract foreign investment and entice international companies to establish operations in Africa…Power sharing has become more prevalent in the African electrical power context in recent years…[as] neighboring countries have seen benefit on the sharing of electricity…countries with limited or unreliable power generation capacity will now have access to power, without the intensive capital investment required to construct new facilities.”

Despite the fading demand from the European leg of the Desertec project, which linked renewable energy from the Maghreb to European customers, it is now obvious that, given projected high growth for sub-Saharan Africa, Morocco’s strategic investments in renewable energies and extension of its power grid southward will provide a critical backbone for regional power distribution. Given the already extensive inputs in power generation and distribution in West and Central Africa, the US should consider broadening its Power Africa program in partnership with Morocco to accelerate the delivery of sustainable energy along the north-south power corridor in the region.

Partners can make a difference in driving economic growth

Over the past several weeks, I have been looking at media coverage of events and activities related to how Morocco is confronting its challenges in driving economic growth. One particular theme that merits more attention is how external partners, whether bilateral or multilateral, can play a significant role in enabling Morocco to maximize its reform efforts.

On March 18, the Carnegie Endowment for International Peace (CEIP) held a panel on “Economic Turmoil in Arab Countries – Can Partners Help?” that raised several key points. First of all, the drive for sustainable development must be internally driven; otherwise the needed political will is absent. Without national leadership, the longer term efforts to reform are marginalized and politicized. Secondly, greater stability in the MENA region benefits donor countries and agencies by supporting an environment in which growing prosperity, jobs, and opportunities reduce conflict and promote greater cooperation within and among countries.

While it is too soon to make conclusive assessments of these partnership arrangements, details of recent programs provide insights into their priorities. The first example is a recent press release on projects funded by the World Bank in Morocco. The funding has two components. The first is a $160 million loan to improve the competitiveness of Moroccan companies. It includes simplifying the regulatory environment and strengthening the capacity of Moroccan agencies tasked with business and investment development. Interestingly, as reported in my blog last week, this follows on a European Bank for Reconstruction and Development trade facilitation funding agreement with BMCE bank in Morocco. The programs should be mutually supportive.

Simon Gray, the Maghreb Country Director for the World Bank, commented, “Morocco has engaged in a number of promising reforms to liberalize and promote investment in key sectors over the last decade. The impact of these reforms on growth and job creation will be further enhanced by addressing the remaining rigidities in the institutional and regulatory business environment especially as they pertain to small and medium enterprises.” The reforms include addressing government payment delays, bureaucratic red tape, unfair competition, and lack of predictability in implementing rules and regulations.

Also approved by the World Bank is a $6.44 million grant to help small farmers implement land and biodiversity conservation measures in targeted regions. An interesting component of this project is using animal feed generated from by-products from agri-food chains including olive oil, cactus, and argan. This is the latest project by the World Bank in support of the Plan Maroc Vert program, which targets doubling the added-value and jobs in the agricultural sector by 2020.

A Zawya article, “Strong macro drives Morocco’s investment appeal,” notes, “Morocco has emerged as the most stable North African country, after King Mohammad VI navigated through a tricky period during the Arab Spring. A new democratically elected government with powers has led to a relatively stable country compared to the painful transitions in North African peers Tunisia, Libya and Egypt.” It goes on to list hallmarks of EU-Morocco cooperation:

  • Morocco is the first North African state to embark on Deep and Comprehensive Free Trade Agreements (DCFTAs) with the European Union.
  • An EU-Morocco Association Agreement came into effect in 2000.
  • Negotiations for a new European Neighborhood Plan (ENP) for the period 2013-2017 were concluded in November 2012 and a formal adoption process is under way.
  • An agreement on liberalization of trade in agriculture came into force on October 1, 2012.
  • The guidelines for a new Fisheries Partnership Agreement were adopted by the EU in February 2012, and negotiations are ongoing.
  • Morocco remains the largest recipient of EU assistance in the ENP-south region with EUR 580.5 million earmarked for 2011-13 with a focus on social and economic development, environmental protection, and institutional support (i.e. justice and human rights).

A recent IMF report pointed out that higher economic growth, lower unemployment, better health and educational outcomes, better access to basic infrastructure, and a marked reduction in poverty rates are tangible evidence of Morocco’s progress in fostering inclusive growth. The only black mark is youth unemployment, which remains particularly high.

It is too soon to write the headlines for Morocco’s economic future, yet it is clear that providing a platform in support of solid political, social, and economic reforms is a key role for external partners. Targeted and results-focused assistance programs, developed through frank and constructive dialogue with recipient countries, are keys to achieving tangible outcomes that promote inclusive growth and enhance stability. In this period of budgetary constraints among all the partners, it is helpful for American taxpayers to know that the US is not alone in working hard to promote security and prosperity in the MENA region.