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Morocco

MehdiElHajoui AvielMarrache RomanRosenberg KellySpriggs

Note:throughoutthisdocument,conversionrateissetatUSD1=MAD8.5 BasicInformationaboutMorocco[i] BriefHistoryofMorocco WhiletheareaofpresentdayMoroccohasbeeninhabitedforatleast10,000years, modernMoroccowasbornintheseventhcentury,whenArabssettlersestablishedapresence there.BerberandArabdynastiestradedpowerthroughouttheMiddleAges,untiltheAlaouites gainedpoliticalcontrolinthemid1600s.In1777,Moroccowasthefirstcountrytorecognize theUnitedStatesindependence. In1912,MoroccobecameaFrenchprotectorate,whileSpainassumedcontroloverthe SaharaandsomeNorthernregions.Fortyfouryearslater,Moroccogaineditsindependenceas FranceallowedmonarchMohammedVtoreturnfromexile. Since1956,Moroccoisaconstitutionalmonarchywithabicamerallegislature.AfterKing HassanIIpassedawayin1999,MohammedVItookthethrone.Generallyperceivedasa progressivemonarchKingMohammedhaschampionedcampaignsofsocialreformand liberalization.Theyoungmonarchfacescriticismfromreligiousconservatives,whohavegained tractioninMoroccanpolitics.ThestatusofWesternSahara,whichMoroccovirtuallyannexed inthe1970s,isanothermajorissuethathasyettoberesolved. Population Population:34,343,220(July2008est.)[ii] Agestructure:014years:30.5%;1564years:64.3%;65yearsandover:5.2% Birthrate:21.31births/1,000population Lifeexpectancyatbirth:71.52years EthnicGroups:ArabBerber(99.1%),other(0.7%),Jewish(0.1%) ReligiousGroups:Muslims(98.7%),Christian(1.1%),Jewish(0.25%) GDP GDP(PPP):137.4billion(2008est.) GDPrealgrowthrate:5.3%(2008est.) GDPpercapita(PPP):$4,000(2008est.) GDPpersector:Agriculture:14.7%;Industry:38.9%;Services:46.5%(2008est.) MajorIndustries Phosphate Rockminingandprocessing
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Foodprocessing Leathergoods Textiles Construction Tourism Agriculture MacroeconomicData Inflationrate(consumerprices):4.6%(2008est.) Laborforce:11.5million(2008est.) Laborforcebyoccupation:Agriculture:44.6%;Industry:19.8%;Services:35.5%(2006 est.) Unemploymentrate:9.1%(Q22008,StateHighPlanningCommissionestimate); Budget:Revenues:$26.09billion;Expenditures:$28.41billion(2008est.) Publicdebt:60.2%ofGDP(2008est.) BankingSystem AdditionalinformationforthissectioncanbefoundinIMFMoroccoFinancialStability Assessment(2008).pdf,andTheReport:EmergingMorocco2007(availableonGoogle books)(bothpostedonWebcafe) 16commercialbankswith$60.2billioninAssets. TheBig3share$38.4billioninAssetsandaccountfor63.8%ofthemarket. AttijariwafaBank($16.3billioninAssets)27.1%share BanqueCentralePopulaire(BCP)($14.1billioninAssets)23.4%share BanqueMarocaineduCommerceExtrieur(BMCE)($8.0billioninAssets)13.3%Share 13smalltomidsizedplayerswith$19.3billioninAssetsgarner36.2%marketshare CreditPopulaireduMaroc(CPM) BankAlAmal CrditAgricoleduMaroc(CAM) FondsdEquipementCommunal CrditImmobilieretHotelier(CIH) UnionMarocainedeBanques MdiaFinance CrditFoncierduMaroc(CFM) SocitGnraleMarocainedeBanques(SG) CrditduMaroc(CDM) CitibankMaroc
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ArabBankMaroc ForeignVersusDomesticOwnership[iv][v] 5ofthe16commercialbanksaredominatedbyforeignownership Citibank(100%ownedbyCitibank) ArabBankMaroc(100%ownedbyArabBank) BMCI(65%stakeownedbyBNPParibas) CrditduMaroc(52.6%stakeownedbyCrditAgricole), SG(51.9%stakeownedbySocitGnrale) Majorityforeignownedbankshold21%ofAssetsatend2006.Inaddition,severalbanks haveminoritystakesinMoroccosBig3: Santander(14.6%ofAttijariwafaBank) CIC(10%ofBMCEholding) CAM(5%ofBMCEholding) Sourceoffunds[vi] Deposits(82%) Debtandotherliabilities(13%) Loans(5%) Privatizations:partialversusfull[vii] Governmentownershipstandsat23%ofAssetsin2006,downfrom40%in2002 Theformerspecializedpublicbanks(BankAlAmal,CrditAgricoleduMaroc(CAM), FondsdEquipementCommunal,CrditImmobilieretHotelier(CIH)nowaccountfor only7percentoftotalbankassets. InterestSpread(LendingRateMinusDepositRate) TheinterestspreadislargeespeciallybycomparisonwithUSfigures.Therangeisquite widebutseemstoaverage800to1200bpsabovethedepositratecurrentlyhovering around1100bps. HistoricalinformationonborrowingratescanbefoundatBorrowingRates1983 2009.pdf(postedonWebcafe),whilehistoricalinformationonlendingratescanbe foundatLendingsRates20032009.pdf(postedonWebcafeaswell)
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BankCredittothePrivateSector[xxxviii] Since2006,credittotheprivatesectorhasbeenincreasingrapidly,growingbyalmost 30percentyearonyearin2007,whileitsratiotononagriculturalGDPjumpedbymorethan 10percentagepointsbetween2006and2007,toreachalmost80percent. BankCredittothePublicSector $640millionasofSeptember2008 Detailslistedat: http://web.worldbank.org/WBSITE/EXTERNAL/ACCUEILEXTN/PAYSEXTN/MENAINFRENC HEXT/MOROCCOINFRENCHEXTN/0,,contentMDK:20149674~pagePK:141137~piPK:1411 27~theSitePK:468145,00.html DepositInsurance:Partialvs.Full[xviii]IV UnderArticle105ofthebankinglaw,thedepositguaranteefundmaycompensate depositorsforlostfunds(uptoamaximumamountofDH80,000,approximately$11,000per customer,includingcorporatecustomers).Ifthefundisinsufficienttopayoutalleligible deposits,proratahaircutsareappliedtodepositorsclaims,accordingtotheBAMcircular22G Insurancecompaniesandotherfinancialinstitutions AdditionalinformationforthissectioncanbefoundinIMFMoroccoFinancialStability Assessment(2008).pdf,MoroccanBankingSystemBankAlMaghrib.pdfandTheReport: EmergingMorocco2007(availableonGooglebooks)(allpostedonWebcafe) SizeandStructureofInsuranceCompanies[viii]: ThoughthelargestintheMaghrebandsecondlargestinAfrica,theMoroccaninsurancesector isstillrelativelyunderdevelopedrelativetootheremergingnations With109.5billionMAD(~$12.9billion)inassets(2007),thesectoraccountsforless than10%oftotalfinancialsystemassets. PremiumsstandatMAD17.7billioninpremium(2007),oraround3%ofthecountrys GDP.Thisamountstoonly$65percapita. Thereare17insurancecompaniesandasingledomesticreinsurancecompany(the CentralReinsuranceCompany,orSCR). However,thesectorisfairlyconcentrated,with3playersowninga+50%marketshare Insurancecompaniesdonotgenerallymaintaintieswithcommercialbanks
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LifeandPropertyandCasualty[v] Propertyandcasualtyinsurancerepresent71.8%ofthepremiums.Thissegmenthas grownatanannualrateof7.2%(2006).Lifeinsurancepremiumsaccountfor28.2%ofthe premiums.Thissegmenthasexperiencedthegreatestgrowthrateintheinsuranceindustry, growingatanannualrateof26.7%(2006). OtherFinancialInstitutions(suchasMutualFunds)[ix] Themutualfundsectorisrelativelymodestinsize WithMAD132billion($15.5billion)inassetsundermanagement(2007),thesector accountsforabout11%oftotalfinancialsystemassets Thesectorisfragmented,with238playersin2007(upfrom181in2004) Undercurrentregulations,mutualfundscaninvestupto10%oftheirassetsinforeign currency CentralBankanditsRoleintheEconomy: FurtherinformationonmonetarypolicycanbefoundatBAMMonetaryPolicy(inFrench, postedonWebcafe) DeterminingInterestRates[xxii]: BankAlMaghreb,theMoroccanCentralBank,doessetinterbankinterestrates.Itaims toregulatemoneysupplyanddemandthrough7dayadvances,openmarketoperations, repotypetransactions,andcurrencyswaps.Thereisadiscountwindowtypefacilitycharging 100bpsoverinterbankrate,butmeanttobeusedaslastresort. ExchangeRates:SetorFloating?[iv] TheMoroccanexchangerateregimeisaconventionalpeg,basedonabasketof currenciesconsistingoftheeuroandtheUSdollar,withweightsof80and20 percentrespectively,broadlyreflectingMoroccostradeflows AdditionalExchangeRateData: $1=8.599MADon2/11/09 TheMoroccanexchangerateregimeisaconventionalpeg,basedonabasket ofcurrenciesconsistingoftheeuroandtheUSdollar,withweightsof80and20 percentrespectively,broadlyreflectingMoroccostradeflows. TheMoroccanauthoritieshaveannouncedapolicyofcontinuedgradualliberalization ofthecapitalaccountandincreasedflexibilityoftheexchangerateinmediumterm.
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InAugust2007,theauthoritiesliftedcertainrestrictionsontransactionsbyresidents, andincreasedthescopeforfinancialinstitutions,banksandenterprisesto investabroad HistoricaldataoninterestratesbefoundatBAMInterestRates,anddataon exchangeratescanbefoundatBAMExchangeRates(bothpostedonwebcafe)

PriceStability[xxiii] The primary objective of Bank Al Maghreb is price stability. This inflation targeting policy was entered into in 2006. A multicriteria approach is used to assess inflation risk. Includedarethefollowing5categories: o changeinglobaldemand, o unemploymentandcapacityrestrictions, o monetary conditions (money supply, interest rates, counterparty risks,realestateandfinancialprices), o importprices, o inflationexpectations. InformationonfunctionsoftheCentralBankcanbefoundatBAMMonetaryPolicy (inFrench,postedonWebcafe) IndependenceandGovernance[x]: Traditionally,BankAlMaghrebwasadministeredthroughtheMinistryofFinance. However,alegislativechangeinFebruary2006madetheCentralbanksauthorityindependent ofthatoftheMinistryofFinance.Asaresult,theCentralbankhashadmoreautonomywhen itcomestodesigningandimplementingmonetarypolicyAccordingtoBankAlMaghrebs governorAbdellatifJouahri,thechangehastranslatedintothepassageofamulticriteria approachtomakingtheframeworkofaninflationaryriskevaluationstrategy,aswellasthe adoptionofanoperationalframeworkthatharmonizestheinterventionproceduresinthe monetarymarket InformationontheindependenceandgovernanceoftheCentralBankcanbefound atBAMOrgChartandBAMGovernance(inFrench,bothpostedonWebcafe) Governmentbondmarket[xxiv] a) Maturities GovernmentIssues:CurrentIssuesPrimaryMarket

Maturity

Characteristics

Min Max Weighted Rateor Offered (Rateor (Rateor Retained average price amount price price amount rateor limit offered) offered) price 720.00 3.66% 3.67% 600.00 99.84% 99.93% 1600.00 99.76% 99.96% 0.00 0.00% 0.00 0.00% 0.00 0.00% 0.00% 0.00% 0.00% 99.73% 0.00%

26WEEKS 52WEEKS

17/08/2009

19/07/2010, 3.80% 18/04/2011, 2YEARBILLS 3.90% 01/12/2013, 5YEARBILLS 4.00% 15/01/2017, 10YEARBILLS 3.40%

7360.00 99.40% 99.76% 1000.00 99.71% 1600.00 94.34% 94.45% 0.00 0.00%

TransactionsinthesecondarymarketforTreasuryBonds: Lastingperiod LESSTHAN32DAYS FROM32TO92DAYS FROM93TO182DAYS FROM183TO365DAYS FROM366DAYSTO2YEARS MORETHAN2YEARSTO3YEARS MORETHAN3YEARSTO5YEARS MORETHAN5YEARSTO10YEARS MORETHAN10YEARS Total SpecialIssues(NoLongerOffered): BradyBond:dollardenominatedbondsissuedbytheMoroccangovernmentandare partlyorwhollybackedbyUSTreasuryBondsandareoftenfloatingratebondstrading atLIBOR+13/16.
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Amount Number 11240.36 66 29427.16 161 25554.77 173 43642.63 308 116158.27 503 11665.88 136 18201.61 158 99534.92 775 151342.10 1223 506767.70 3503

InterestRateinMillionsofDirhams[xix] Term Transactions Weightedaveragerate Valuedate 16/03/2009 112.22 3,650% 08/01/2009 16/03/2009 88.01 3,600% 12/02/2009 20/07/2009 205.30 3,660% 12/02/2009 10/08/2009 1175.03 3,659% 09/02/2009 18/10/2009 50.69 3,700% 09/02/2009 16/10/2010 136.56 3,880% 16/02/2009 14/02/2011 137.61 3,840% 13/02/2009 02/12/2012 31.53 3,982% 13/02/2009 01/12/2013 1005.69 4,061% 16/02/2009 05/02/2022 31.02 4,604% 21/01/2009 05/02/2022 52.65 4,480% 13/02/2009 02/01/2026 25.91 4,690% 13/02/2009 04/12/2036 36.98 4,500% 28 TreasuryBills o 3months:seeITMAR3M_3moTBill.xls o 6months:seeITMAR6M_6moTBill.xls o 12months:seeITMAR12M_12moBill.xls GovernmentBonds o 5yearsmaturity:seefileIGMAR5M_5YearBondYields.xls o 10yearsmaturity:IGMAR15M_15YearBondYields.xls o BradyBond:seefileIGMARBM_BradyBondsInterestrates.xls Governmentbondmarket[xxiv] BothPrimaryandsecondarymarketsareundertheMinistryofFinancesupervision Secondarymarketrepresentslessthan5%oftheGovernmentsecuritiesannual turnover(2001) Methodsofprimaryissuance[xxiv] Broadissuanceplanwithregularschedule Issuancemethod:Auctiontypewithmultiplepriceandunlimitednoncompetitivebids
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Stockmarket: CompaniesListed[xi] 77publiclytradedcompanies.InordertobelistedontheCasablancaStockExchange, companiesarerequiredtosellaminimumof20%oftheircapital[v]. 10mostactivelytradedinCentralMarket(fromsmallesttolargestvolume):DeltaHoldings, SONASID,BCP,Alliances,AttijariWafaBank,ONA,CGI,BMCEBank,ItissalatAlMaghreb,Douja PromAddoha 10mostactivelytradedinBlockMarket(fromsmallesttolargestvolume):CimentsduMaroc, SONASID,Alliances,Salafin,SNI,ItissalatAlMaghreb,BCP,LafargeCiments,AttijariWafaBank, BMCEBank ListofcompanieslistedcanbefoundatStockMarketSumary2008(inFrench).pdf(posted onwebcafe) Historicaldataonlistedanddelistedsecuritiescanbefounddirectlyatthe CasablancaStockExchangeOfficialWebsite(linkpostedonwebcafe) StockPriceData Stockpricedatafor2008canbefoundatStockMarketSumary2008(inFrench).pdf (postedonwebcafe). HistoricaldataandgraphfortheMASIIndexcanbefoundatMasi_Index(1992 2009).xlsx(postedonwebcafe) HistoricaldataonindividualstockscanbefounddirectlyattheCasablancaStock ExchangeOfficialWebsite(linkpostedonwebcafe) Volumes[xii] CentralMarket Averagedailyvolumetradedshares(2008):MAD639.47million(~$75.2million) Averagedailyvolumetradedbonds(2008):MAD9.81million(~$1.2million) o BlockMarket Averagedailyvolumetradedshares(2008):MAD185.46million(~$21.8 million) o Averagedailyvolumetradedbonds(2008):MAD53.97million(~$6.3million) o AveragedailyvolumetradedCentral+BlockMarket(2008):MAD888.72
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(~$104.4million) Volumedatafor2008canbefoundatStockMarketSumary2008(inFrench).pdf (postedonwebcafe). HistoricalvolumedatacanbefoundatStockMarketVolumes(19922009).xlsx (postedonwebcafe). MarketCapitalization[xiii] MAD531.8billion(~$65.6billion)asofDecember31,2008 ComparativemarketcapitalizationinformationcanbefoundatCasablancavs.MENA stockmarkets.pdf(postedonwebcafe) HistoricalmarketcapitalizationcanbefoundatStockMarketHistoricalMarket Capitalization(19962006).pdf(postedonwebcafe) TradingVolume[xiv] TotalvolumetradedCentral+Blockmarket(2008):MAD217.7billion($25.6 billion) TradingVolumesdatafor2008canbefoundatStockMarketSumary2008(in French).pdf(postedonwebcafe). HistoricalvolumedatacanbefoundatStockMarketVolumes(19922009).xlsx (postedonwebcafe). Turnover[TradingvolumeasafractionofCapitalization;TradingvolumeasafractionofGDP] [xv] TurnoverTradingvolumeasfractionofcapitalization:217.7/531.8=40.9% TurnoverTradingvolumeasfractionofGDP:217.7/137.4=158.4% ComparativeturnoverdatacanbefoundatCasablancavs.MENAstockmarkets.pdf (postedonwebcafe) PrivatizationsthroughtheStockMarket In2005twentysevenfirmsandeighteenhotelshadbeensoldsinceprivatizationbeganin 1993.Salesoccurredthroughopentender,publicissues,tradesalesandthestockexchange. [xxv].NoteworthysalesincludeMarocTelecomandRgiedesTabacs.In2000,Vivendi
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Universalpurchased35%ofMarocTelecomfor$2.3billion.Laterin2004,14.9%ofMaroc Telecomwasopenedtothepublicviathestockmarket,amountingto$800million.Vivendi Universalmadesubsequentpurchasesof14.9%ofMarocTelecomscapitalfor$800millionin 2004,and16%for$1.2billionin2005.34.1%ofcapitalremainstobetransferred.[xxvi]In2003 theFrancoSpanishgroupAltadispurchased80%ofthecapitalofRgiedesTabacsfor$1.2 billion.Thefinal20%ofMarocTelecomwassoldin2006toalocalbranchofAltadis.[xxvii] AutomationVersusManualTrading Theelectronicquotedriventradingsystem(NSC)isanautomatedplatformforthe managementofstockmarkettradingsessions.Itenablestheautomaticroutingofstock marketordersandthecompletionoftransactionsaccordingtopredefinedmarketrules. [xxviii].AllsecuritiesquotedontheCasablancaStockExchangearetradedbymeansofthe electronictradingsystemusingtradingterminalssuppliedtobrokeragefirms.Stockmarket ordersenteredbydealingagentsareautomaticallyrankedbypricelimitandbythe chronologicalorderbywhichtheyhavebeenenteredintotheorderbook.[xxix] InformationonautomationcanbefoundatStockMarketOrganization.pdf(postedon webcafe) ForeignandLocalOwnershipintheStockMarket: TheCasablancaStockExchangeplacesnorestrictionsonoronforeignownershipof Moroccancompanies.Taxesondividendsareidenticalforlocalandforeigninvestorsalikeat 10%.Additionally,neitherinvestorischargedacapitalgainstax.[xxix].Thereis,however,a verylowrateofforeigninvestmentintheCSE.AsofSeptember200therationoflocalto foreigninvestmentwasestimatedtobe19to1.[xxx] ConcentrationofTopListedCompaniesasaFractionofMarketCapitalization[xxxi] 5.38978E+11 TotalMarketCapitalization[xxxii] MAD Share Shares Market Ticker CompanyName Price Outstanding Capitalization MC/TotalMC SOF SocieteFind'AchatsCredit 387.15 1400000 542010000 0.001005625 ONA ONA 1370 17500000 23975000000 0.044482301 ATL Compagnied'Assurancesetde ReassurancesATLANTASA 110 59160000 6507600000 0.012073953 CMT CompagnieMinieredeToussit 717 1490000 1068330000 0.001982139 IAM ITISSALATALMAGHRIB 150.2 879095340 1.3204E+11 0.244982207
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SharesOutstanding [xxxiii] [xxxiv] [xxxv] [xxxvi] Concentrationoftoplistedcompaniesasfractionofmarketcapitalizationdatafor2008 canbefoundatStockMarketSumary2008(inFrench).pdf(postedonwebcafe). AggregateStockMarketReturns(bothinlocalcurrenciesanddollars) Issue212008[xxxvii] Table1:Summarystatisticsofdailyreturns(Definedasthelogdifferenceoftheprice) MASI S&P500 Mean 0.01252 0.000187 Median 0.0000 0.000368 Maximum 2.467184 2.42043 Minimum 2.373288 2.607812 StdDev 0.382306 0.475661 InformationonaggregatestockmarketreturnscanbefoundatMasi_Index(1992 2009).xlsx(postedonwebcafe) RegionalIntegrationInitiatives InformationonregionalintegrationinitiativescanbefoundatMaghrebIntegration Initiatives.pdf(postedonWebcafe) OthertypesofFinancialMarkets Bondmarkets[xvi] PublicsectorbondissuesdominatethedebtmarketwhilePrivatesectorcorporateissues remainmarginal.Commercialbankscontinuetoserveasthemainprovidersofcommercial financing Fordetailedlistsofnongovernmentbond,seeBondMarket.pdf(postedonWebcafe)
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Derivativesandsoforth Futuresmarketbasedontreasurybondsopenedin2008.Firstattempttobroadenthe offeringinCSE. FormoredetailsonOthertypesofFinancialMarkets,seeIMFMoroccoFinancial StabilityAssessment(2008).pdf(postedonWebcafe) Othertypesoffinance Microfinance:x Sincetheearly1990s,USAIDhashelpedincreasingtheaccesstofinancialservicesfor thepoorergroupsofthepopulationinthedevelopingcountries.InMorocco,theshapeofthe microfinancelandscapewaseventuallyformalizedintoalawpassedinJanuary2000. Thislawregulatingmicrofinancestipulatesthatmicrocreditshouldbecarriedoutbyessentially nonprofitfinancecompanies.Microfinanceinstitutions(MFIs)cannotcollectsavingsandthere isaceilingonloansizesnowsetatabout$3,000.MFIsareonlyallowedtolendforproductive activities. However,MFIshavebroadpermissiontoinnovatebothinmobilizingcapitalandin lendingmethodology. MFIsIncorporatedinMorocco:xxi Nameofthe Typeofinstitution Grossloanportfolioin Numberofactive company US$ borrowers AlAmana Nonprofit(NGO) 304,743,477 472,961 (12/31/07) (12/31/07) AlKaram Nonprofit(NGO) 3,302,287 11,972 (12/31/07) (12/31/07) AMOS Nonprofit(NGO) 1,176,593 5,854 (12/31/07) (12/31/07) AMSSF/MC Nonprofit(NGO) 5,780,163 19,095 (12/31/07) (12/31/07) ARDI Nonprofit(NGO) 18,739,959 74,759 (12/31/07) (12/31/08) ATILMC Nonprofit(NGO) 696,803 2,294 (12/31/06) (12/31/06) FBPMC Nonprofit(NGO) 134,291,756 176,738 (12/31/07) (12/31/07) FONDEP Nonprofit(NGO) 51,441,777 111,495
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INMAA Zakoura

Nonprofit(NGO) Nonprofit(NGO)

(12/31/07) 3,022,720 (12/31/07) 198,205,389 (12/31/07)

(12/31/07) 10,236 (12/31/07) 443,016 (12/31/07)

Formoredetailsonmicrofinance,seeUSAIDMorocco.doc(postedonWebcafe) InformalFinance[xvii]: Microfinancewouldbeoneexample.Angelfinancewouldbeanother.Bankingpenetration rateinMoroccoislimited.Penetrationreached25%(34%ifthePosteduMarocnetworkis included)ofthepopulationin2007.Thereisonlyonebankbranchper12,000inhabitants.Asa result,cashtransactionsdominatetheeconomy,especiallyinruralareas. FormoredetailsonInformalFinance,seeTheReport:EmergingMorocco2007(available onGooglebooks)(postedonWebcafe) PrivateEquity: CapitalInvest~$80100M,Moroccoonly "CapitalInvestwasformedin2000asaprivateequityfundmanagerinMorocco.Itsmain sponsorisBMCECapital(70%ownership),whichisasubsidiaryofBMCEBank,oneofthe largestcommercialbanksinMoroccoTheothershareholdersoftheManagerincludeSiparex (15%ownership),aFrenchprivateequitygroup,andCICFinance(15%ownership),aFrench bankinggroup." Executivesinclude: Mr.MehdiTahiri(MinesParis,ArthurAndersen),President Mr.OmarChikhaoui(MBA,UniversityofTexas),Director Mr.YounesAlAbdan(ENSTA,GroupeONA),InvestmentDirector Ms.NoraKhiyati(MBA,ManchesterBusinessSchool,Ernst&Young),Investment Director Mr.NasserKadiri(ESSEC,CDCEnterprises),SeniorInvestmentDirector Ms.KhaoulaRamdi(ParisDauphine,Ernst&Young),SeniorInvestmentDirector Ms.ImaneAlami(BBA,UniversityofTexas),Controller CurrentPortfolio: BEXEL RetailDIY BUZZICHELLIMAROC ManufacturingMachinery CELIO CONSERNOR RetailFashion&Clothing ManufacturingCannedfood
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DISLOG DISTRISOFT FINAPACKCMCP

RetailMiscellaneousCPG RetailComputer&IT ManufacturingPapergoods

GALAXYELECTRONICS RetailElectronics IFC INDUSALIM LABINAL LOCASOM M2MGROUP PROMINOX SONIAMA VALYANS WEBHELP UNIVERSMOTORS MOBILIA FONDCAPITALMOROCCO$25M. InvestmentstrategyisminorityownershipinsmallandmediumsizedMoroccancompanies seekingtopositionthemselvesasnationalorregionalleadersinfastgrowingsectors FONDCAPITALNORTHAFRICA$50M InvestmentstrategyisminorityandmajorityownershipinmediumsizedandlargeNorth Africancompanies(revenues$15$75M,marketcap$8$45M)infastgrowingsectors(agro industry,chemicals,pharmaceuticals,construction...)withapotentialformergers. SomefundingfromtheIFC. EmergingCapitalPartners(source:ECPwebsite)>$105MforMorocco(viaJVwithAttijari Invest),multicountryfund ECPisthefirstprivateequitygrouptoraisemorethan$1.6billionforinvestmentincompanies acrosstheAfricancontinent.TheECPteamhasbeeninvestinginAfricasince2000.ECP'strack recordinprivateequityinvestingacrosstheAfricancontinentincludes: SixprivateequityfundsfocusedonAfrica,totalingmorethan$1.6billionunder management Over50investments,20exits,andastrongportfolioofremainingtransactions Investmentsinmorethan40countries,inallmajorregionsoftheAfrican
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ManufacturingIndustrialbakery ManufacturingMargarine ManufacturingElectronics ServicesCarRental ServicesSoftware ManufacturingMetalfabrication ManufacturingCouscousandPasta ServicesConsulting ServicesCallCenters RetailCardistributor RetailFurniture

continent CurrentPortfolio: Location: Industry: Fund: OSEADMarocMining OMMisaspecialpurposevehiclethatownsCompagnieMiniredeTouissit,theoldest leadproducerandexporterinMorocco. CurrentPortfolio: Morocco Water&ElectricityDistribution AIGAfricanInfrastructureFund Morocco Metals&Mining MoroccanInfrastructureFund

Location: Industry: Fund:

VeoliaWaterMaroc: VWMdevelops,acquires,andoperatescompaniesinthewaterdistribution,wastewater treatment,andelectricitydistributionsectorsinMorocco. Fund: InvestmentsinMoroccothroughtheMoroccanInfrastructureFund($105M)andvariousAfrica funds TheMoroccanInfrastructureFund("MIF"orthe"Fund")wasestablishedinDecember2006to capitalizeontheongoingreformsdesignedtospureconomicgrowthinMorocco.Thisgrowthis expectedtorequirelargeinvestmentstoimproveMorocco'sinfrastructure.MIFhasMAD800 million($105million)incapitalcommitmentsfromMoroccan,EuropeanandKuwaitiinvestors. MIFismanagedbyMoroccanInfrastructureManagement,ajointventurebetweenEmerging CapitalPartnersandAttijariInvest.AttijariInvestistheprivateequityarmofAttijariwafaBank, Morocco'slargestbank. MIFtargetsnumeroussectorsincludingTelecoms,Transportation,Energy,PowerandWater, andPorts.TheFundseekstoinvestalongsideworldclassinternationalandlocalpartnerswith extensiveoperationalexperience,aproventrackrecord,andasuperiorbusinessreputation.
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TheFundseekseithermajorityorminoritypositionsthroughequity,quasiequityand convertibledebtinstruments.TheFund'sequityinvestmentstypicallyrangeinsizefromMAD 50milliontoMAD150millionwithamaximumof20%oftheFund'stotalsizeavailableper transaction.TheFundisabletoincreaseitsmaximuminvestmentsizeusingleverage. AttijariInvest,$450M,Moroccofocusedfund SecretivePEshop,100%ownedbyAttijariWafabank(largestbankinMorocco) Upto$450Mincommittedcapitalthrough4funds:MoroccanInfrastructureFund(JV withECP,$105m,focusedontheinfrastructuresector),AgramInvest($25M,focusedon theagroindustrysector),Igranefund($25M,focusedonregionalinvestments)and MoroccoHospitalityfund($280M,focusedontourisminvestments) FormerfundmanagerisLamiaBoutaleb(WhartonMBA1998) MarocInvest,Moroccofocusedfund(MarocInvestwebsite) MoroccofocuseddiversifiedPEFund(VC,developmentcapital,LBO,preIPO).Jointly ownedbyTuninvestFinanceGroup($80M,TunisiabasedPEfirm)andUplineSecurities (Moroccobasedbrokeragefirm) Executivesinclude: Mr.BrahimJai(ESCPEAP,AltranTechnologies),GeneralManager Mr.AzizMebarek(ENPC,TuninvestFinanceGroup),Partner Currentportfolio SigmatelGlobalNetworksSolutions SiprofManufactureofFrictionProducts MaghrebAccesoiresWholesaledistributionofautomotivespareparts MatelWholesedistributionofITproducts CMCPManufactureofcorrugatedcardboardpackaging S2MServicesrelatedtomeansofpayment FollyFashionFashion(Marwa) Formoredetailsonmicrofinance,seePrivateEquityinMorocco(inFrench).pdfand MoroccoFinancingTechEntrepreneurs.pdf(bothpostedonWebcafe)
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[i]Unlessotherwisenoted,allfiguresinthissectionaretakenfromtheCIAWorldFactbook (https://www.cia.gov/library/publications/theworldfactbook/geos/mo.html) [ii]ExclusiveofWesternSahara(July2008est.:393,831) [iii]MoroccoBankingSectorModernization(U.S.DepartmentofCommerce,March2007) [iv]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [v]TheReport:EmergingMorocco2007(OxfordBusinessGroup,2007) [vi]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [vii]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [viii]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [ix]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [x]TheReport:EmergingMorocco2007(OxfordBusinessGroup,2007) [xi]OfficialwebsiteoftheBoursedeCasablanca(www.casablancabourse.com) [xii]OfficialwebsiteoftheBoursedeCasablanca(www.casablancabourse.com) [xiii]OfficialwebsiteoftheBoursedeCasablanca(www.casablancabourse.com) [xiv]OfficialwebsiteoftheBoursedeCasablanca(www.casablancabourse.com) [xv]OfficialwebsiteoftheBoursedeCasablanca(www.casablancabourse.com) [xvi]MoroccoFinancialSystemStabilityAssessment(InternationalMonetaryFund,October 2008) [xvii]TheReport:EmergingMorocco2007(OxfordBusinessGroup,2007) [xviii]DepositInsurance:Concept,PracticeandRelevanceinAfrica(www.ndic ng.com/pdf/iadicmat2.ppt) [xix]GlobalFinancialData(GFDaccessedthroughLinpincottLibraryDataBaseaccounts) [xx]USAIDMoroccoMicrofinanceProgram [xxi] http://www.mixmarket.org/en/demand/demand.global.results.asp?refreshSearch=demand&s0 wrc=MA&seDisc=all& [xxii]BankAlMaghrebInterestRateInfo [xxiii]BankAlMaghrebExchangeRateInfo [xxiv]BankAlMaghrebBondMarket [xxv]ChoufouniInvestinMorocco [xxvi]KingdomofMoroccoPrivatizationProcess [xxvii]ZawyaMoroccoKeyDevelopments
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[xxviii]Nationmaster.comCasablancaStockExchange [xxix]MbendiInformationServicesCasablancaStockExchange [xxx]MagharebiaGlobalEconomicCrisisTriggersBearMarketinMorocco [xxxi]CasablancaStockExchange [xxxii]CasablancaBourseHistoricalInformation [xxxiii]BusinessWeekSocieteFind'AchatsCredit [xxxiv]BusinessWeekGroupeONA [xxxv]ReutersCompagnieMinieredeToussit [xxxvi]CorporateInformationItissalatAlMaghreb [xxxvii]InternationalResearchJournalofFinanceandEconomicsMorocco&USEquity Linkages [xxxviii]CreditMarketinMorocco:ADisequilibriumApproachIMFWorkingPaperMarch 2009

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