As in other developing countries, small and medium sized enterprises (SMEs) and very small businesses (VSBs) play an important role in Morocco’s economy. The head of the cooperation service at the National Agency for SME Promotion (Agence Nationale pour la Promotion des Petites et Moyennes Entreprises, ANPME), Houssam Fathi, told OBG that SMEs account for almost 95% of all registered businesses, half of employment and 30% of the country’s exports, and that the sector contributes 20% of value added to the economy. Eager to drive growth in this sector, the government has established aid programmes, simplified administrative procedures, and partnered with local banks and international investors to ameliorate financial conditions.
ACCESSING FINANCE: According to Hiba Zahoui, the deputy director of banking supervision at Bank Al Maghrib (BAM), 30% of loans extended to corporates on an annual basis are to SMEs and VSBs. While this is almost double the rate of other MENA countries, given the weight of this sector in the economy, Zahoui said that more needs to be done, particularly for VSBs. A financial education programme is being rolled out to increase the sector’s awareness of finance and insurance products, and BAM is also working with local banks to develop simple banking products for VSBs. To encourage bank lending to SMEs and VSBs, the Central Guarantee Fund (Caisse Centrale de Garantie, CCG) announced in 2012 that it would act as a guarantor for SMEs seeking credit as part of a new initiative. Under the Damman Express programme, if the loan is approved the CCG will guarantee 70% of the principal, provided the total loan does not exceed Dh1m (€88,800).
Financial authorities also encourage SMEs to turn to capital markets in order to raise funds, with the Casablanca Stock Exchange (CSE) subsidising initial public offering (IPO) costs for SMEs of up to Dh500,000 (€44,400), while the government offers tax incentives following an IPO. Additionally, the CSE is also considering the creation of an alternative market dedicated to SMEs to include looser listing requirements and lower fees.
INTERNATIONAL INTEREST: In 2012 the European Bank for Reconstruction and Development committed two, €20m lines to Moroccan operators AfricInvest-Tuninvest Group and Société Générale Maroc bank, with the objective of providing loans to SMEs. Concurrently, it established a small business support programme comprising two elements, Business Advisory Services (BAS) and the Enterprise Growth Programme (EGP). BAS assists SMEs and VSBs to access local consultants by providing grants of up to €10,000. The EGP focuses on significant managerial or structural changes, and helps facilitate companies’ access to international executives with experience from the same industry. To date, BAS has received €860,000 in donor funding and undertaken 21 projects, while the EGP has received €1.2m in donor funding and started 13 projects.
This appears to have stirred interest in the sector, and a number of new credit lines were opened in 2013 with Moroccan financial institutions, all targeting SMEs.
LOCAL PROGRAMMES: Lack of technology skills, management skills and knowledge of tax administration also impose limitations on the SME sector. The ANPME is in charge of implementing a number of programmes that specifically target these issues.
The Moussanada (“Support”) programme aims to assist firms in projects such as modernisation and business plan development for domestic or international expansion. It provides both technical and training assistance, and can cover up to 80% of the costs involved.
The Imitaz (“Excellence”) programme targets industry champions with an investment project, and provides direct financial support equal to 20% of the project cost up to a maximum of Dh5m (€444,000). Imitaz and Moussanada are supported by Dh1bn (€89m) in government backing through to 2015.
Finally, Infitah (“Beginning”) targets VSBs, providing technical support on elements such as technology, declaration of taxes, obtaining a business registration number and registration of patents. More than 3600 VSBs have benefitted from it since its launch in 2011.
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