The incredible boom of Arab investments
19 January 2010
Read by 1515 persons
• Capital relocated after the September 11 attacks
• Oil and financial flows have contributed to this success story
A wave of Arab capital is pouring into Morocco. An exceptional year in 2006. This is how "seventy-six projects, with a total investment of 62 billion DH and 30,703 direct jobs were registered", according to the director of foreign investment, Hassan Bernoussi. Arab capital occupied first place with more than 17 billion DH and job creation 11 times higher than that recorded in 2005. A frenzy that seems to continue since the beginning of the year... "For 2007, investment intentions from the Gulf countries are 20 billion", underlines the director of Investments.
What explains the enthusiasm of these investors?
First, there are the reforms undertaken by the Kingdom. The "major projects policy" is causing echoes abroad. Among them, we can mention the port of Tangier-Med, the development of the Bou Regreg valley, Casa Offshore....
Most of "these structuring projects will mature between 2008 and 2010. The enthusiasm of investors comes partly from this dynamic", specifies Jamal Ba Amer, president of the Arab Investors Club. This armada of projects aims to position the Kingdom as an export platform to European and African countries. To achieve this, other measures have been implemented.
This is the case of the Génie program, launched to feed the high-tech sectors. It aims to deliver 10,000 engineers within three years. There is also the Azur 2010 Plan and the accompanying real estate boom. To welcome 10 million tourists, it is first necessary to house them. The financial restructuring of establishments such as CIH or the Cherifian Office of Phosphates suggests that the State wants to play the transparency card. This does not leave the funders indifferent. The sectoral breakdown of projects approved in 2006 shows a predominance of the tourism sector (see Infographic). At the head of the regions receiving investments is Marrakech-Tensift-Al Haouz with 18.82 billion DH.
It is followed by Tangier-Tetouan (13.4 billion DH) then Souss Massa Draa (3.5 billion DH) and Doukkala Abda (2.8 billion DH). It should be noted that it is the interministerial investment commission that studies and approves projects eligible for the signing of an agreement or those whose cost exceeds 200 million dirhams.
The comments of the CEO of Somed (Moroccan-Emirati group), Mouatassim Belghazi, support this view. "Morocco has assets that attract investors. It generally has a relatively stable macroeconomic framework: controlled inflation, contained budget deficit..."
• Snowball effect
In 2006, the "performance" of the national economy was supported by an exceptional agricultural year (90 million quintals of wheat) and a major investment flow. The Jettou government did not fail to highlight this in its assessment. Last year, the budget deficit fluctuated between 1.6 and 1.8%.
Analysts were expecting 2.3%. The unemployment rate was reduced to 9.1%. A figure that did not fail, moreover, to trigger a controversy on the basis of the calculation. As for inflation, it was contained to less than 3%. Morocco replenished its foreign exchange reserves to the tune of 21 billion dollars. VAT tax revenues increased by 20%. Consumption was at its peak. It was "boosted by the launch of supermarkets, the installation of major brands, franchises....", comments the former Prime Minister, Driss Jettou. Tourism and remittances from Moroccans living abroad generated revenues of 12 billion dollars.
The same analysis is shared by national businessmen. This is the case of the CEO of Jet Group, Karim Amor. His company has signed a partnership in real estate with the Bahrainis of Real Capita.
"Morocco has demonstrated to the international community its ability to question itself. It is upgrading its infrastructure, its social and economic policy...", he specifies.
• September 11
Geopolitics also played a role. Cynicism or not, the tragedy of September 11 delivered its share of economic benefits! "Anti-terrorism measures have contributed to the reallocation of some of the assets initially invested in European and American countries to Arab countries", specify the financiers Kamal Sebti and Hassan Matai.
The two experts know what they are talking about, given their extensive experience in this field. "Middle Eastern countries are now benefiting from unprecedented oil revenues and are seeking alternative investments to the West, particularly after the cold sweats of September 11", say the CEOs of Jet Group and Somed.
The financial mishap experienced by Dubai Ports World is still fresh in people's minds.
The Emirati firm ended up abandoning its project to acquire 6 American ports. Congress, strongly opposed to this transaction, used several pretexts: national security, economic patriotism. The Dubai company ended up reselling these ports. This episode shows why Arab capital is turning to other destinations.
"Thanks to oil revenues, we have immense liquidity. It is normal to place them in Arab countries rather than elsewhere", specifies Essam Janahi, president of the Bahraini banking group Gulf Finance House (GFH). And it is Muslim countries that have benefited most.
Their market is made up of nearly a billion consumers. "Trade between member countries of the Organisation of Islamic Cooperation (OIC) exceeded 100 billion dollars in 2004. It should increase by 20% by 2015", estimated the director general of the Islamic Centre for Development of Trade (ICDT), Allal Rachdi. A forecast that suggests that investments between Arab and/or Muslim countries will increase.
Faiçal FAQUIHI
leconomiste.com
• Oil and financial flows have contributed to this success story
A wave of Arab capital is pouring into Morocco. An exceptional year in 2006. This is how "seventy-six projects, with a total investment of 62 billion DH and 30,703 direct jobs were registered", according to the director of foreign investment, Hassan Bernoussi. Arab capital occupied first place with more than 17 billion DH and job creation 11 times higher than that recorded in 2005. A frenzy that seems to continue since the beginning of the year... "For 2007, investment intentions from the Gulf countries are 20 billion", underlines the director of Investments.
What explains the enthusiasm of these investors?
First, there are the reforms undertaken by the Kingdom. The "major projects policy" is causing echoes abroad. Among them, we can mention the port of Tangier-Med, the development of the Bou Regreg valley, Casa Offshore....
Most of "these structuring projects will mature between 2008 and 2010. The enthusiasm of investors comes partly from this dynamic", specifies Jamal Ba Amer, president of the Arab Investors Club. This armada of projects aims to position the Kingdom as an export platform to European and African countries. To achieve this, other measures have been implemented.
This is the case of the Génie program, launched to feed the high-tech sectors. It aims to deliver 10,000 engineers within three years. There is also the Azur 2010 Plan and the accompanying real estate boom. To welcome 10 million tourists, it is first necessary to house them. The financial restructuring of establishments such as CIH or the Cherifian Office of Phosphates suggests that the State wants to play the transparency card. This does not leave the funders indifferent. The sectoral breakdown of projects approved in 2006 shows a predominance of the tourism sector (see Infographic). At the head of the regions receiving investments is Marrakech-Tensift-Al Haouz with 18.82 billion DH.
It is followed by Tangier-Tetouan (13.4 billion DH) then Souss Massa Draa (3.5 billion DH) and Doukkala Abda (2.8 billion DH). It should be noted that it is the interministerial investment commission that studies and approves projects eligible for the signing of an agreement or those whose cost exceeds 200 million dirhams.
The comments of the CEO of Somed (Moroccan-Emirati group), Mouatassim Belghazi, support this view. "Morocco has assets that attract investors. It generally has a relatively stable macroeconomic framework: controlled inflation, contained budget deficit..."
• Snowball effect
In 2006, the "performance" of the national economy was supported by an exceptional agricultural year (90 million quintals of wheat) and a major investment flow. The Jettou government did not fail to highlight this in its assessment. Last year, the budget deficit fluctuated between 1.6 and 1.8%.
Analysts were expecting 2.3%. The unemployment rate was reduced to 9.1%. A figure that did not fail, moreover, to trigger a controversy on the basis of the calculation. As for inflation, it was contained to less than 3%. Morocco replenished its foreign exchange reserves to the tune of 21 billion dollars. VAT tax revenues increased by 20%. Consumption was at its peak. It was "boosted by the launch of supermarkets, the installation of major brands, franchises....", comments the former Prime Minister, Driss Jettou. Tourism and remittances from Moroccans living abroad generated revenues of 12 billion dollars.
The same analysis is shared by national businessmen. This is the case of the CEO of Jet Group, Karim Amor. His company has signed a partnership in real estate with the Bahrainis of Real Capita.
"Morocco has demonstrated to the international community its ability to question itself. It is upgrading its infrastructure, its social and economic policy...", he specifies.
• September 11
Geopolitics also played a role. Cynicism or not, the tragedy of September 11 delivered its share of economic benefits! "Anti-terrorism measures have contributed to the reallocation of some of the assets initially invested in European and American countries to Arab countries", specify the financiers Kamal Sebti and Hassan Matai.
The two experts know what they are talking about, given their extensive experience in this field. "Middle Eastern countries are now benefiting from unprecedented oil revenues and are seeking alternative investments to the West, particularly after the cold sweats of September 11", say the CEOs of Jet Group and Somed.
The financial mishap experienced by Dubai Ports World is still fresh in people's minds.
The Emirati firm ended up abandoning its project to acquire 6 American ports. Congress, strongly opposed to this transaction, used several pretexts: national security, economic patriotism. The Dubai company ended up reselling these ports. This episode shows why Arab capital is turning to other destinations.
"Thanks to oil revenues, we have immense liquidity. It is normal to place them in Arab countries rather than elsewhere", specifies Essam Janahi, president of the Bahraini banking group Gulf Finance House (GFH). And it is Muslim countries that have benefited most.
Their market is made up of nearly a billion consumers. "Trade between member countries of the Organisation of Islamic Cooperation (OIC) exceeded 100 billion dollars in 2004. It should increase by 20% by 2015", estimated the director general of the Islamic Centre for Development of Trade (ICDT), Allal Rachdi. A forecast that suggests that investments between Arab and/or Muslim countries will increase.
Faiçal FAQUIHI
leconomiste.com
