OBG talks to Miriem Bensalah Chaqroun, President, General Confederation of Moroccan Enterprises (CGEM)

Miriem Bensalah Chaqroun, President, General Confederation of Moroccan Enterprises (CGEM)

Interview: Miriem Bensalah Chaqroun

How would you characterise the relations between CGEM and the country’s unions?

MIRIEM BENSALAH CHAQROUN: Since the arrival of the new government, CGEM has tried to create an environment in which we can speak frankly. We have proposed a social pact to the unions to promote sustainable competitiveness. This agreement also affects how business is conducted in Morocco, and is important because we are dealing more and more with strong, committed unions and we have to introduce proposals that help to reduce any social tensions that could emerge. For instance, between 2010 and 2011 the number of strikes in the private sector increased by 96.7%, which is enormous. We are now negotiating regulations on work stoppages with the unions, which never wanted to have such regulations in the first place because their right to work is greatly affected. We have put together a roadmap with the unions, but we will need a legal framework as well – something for which it will be necessary to appeal to the government. Ultimately, a law on strikes will bring reassurance to businesses.

What are the priorities when it comes to legal and fiscal reforms to improve the business climate?

BENSALAH CHAQROUN: The CGEM has created a working platform with the current government headed by Head of Government Abdel-llah Benkirane that meets every three months and focuses on five areas: improving competitiveness, developing international commerce, examining the business climate, addressing small and medium-sized enterprises, and looking at labour issues and professional education. All groups are co-chaired by a government minister and a representative from CGEM. In terms of improving the tax climate, we are working with the Ministry of Finance to change the value-added tax regime, as well as corporate and income taxes. We cannot have different tax rates from one year to the next and we do not want one sector to get preferential treatment over another, or one company over another. In the legal area, there is a need for justice reforms in several areas such as business and family law, and administrative procedures.

Additionally, training for judges should be modernised.

There is also the need for greater judicial transparency and a larger number of regional courts of appeal.

In what way does the informal sector affect the competitiveness of companies?

BENSALAH CHAQROUN: The informal sector clearly has a negative impact on our competitiveness because it implies a lack of accountability and leads to non-certified products being sold. One solution would be to enlarge the tax base, whereby the burden will be more equitably shared and not only be borne by companies that operate transparently. Second, and this is very important, we are fighting to introduce a single social security number. This could improve cooperation among the Customs, tax and exchange offices. All other agencies can then follow suit. It will help to simplify administrative procedures and better identify issues that elude the authorities. In 2014 we plan to release a study on the size of the informal economy and we hope to issue recommendations in 2013. It could help push the authorities address this problem with more force.

We cannot just declare that we are competitive or transparent if we do not have the proper control mechanisms in place; words need to be followed by actions.

To what extent does corruption hamper economic competitiveness and what can be done about it?

BENSALAH CHAQROUN: Corruption is a global scourge. The World Bank has calculated that corruption can reduce growth numbers by between 0.5% and 1%, and according to the IMF, investments are on average 5% lower in more corrupt countries compared to less corrupt ones, so it is clear that it poses a threat to competitiveness and development. One way to address this issue is by having fewer administrative procedures. We should also rate the good companies and institutions.

This is in fact a recommendation that CGEM has made.

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The Report: Morocco 2013

Industry & Retail chapter from The Report: Morocco 2013

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