Moroccan Financial and Capital Markets
From International Business Wiki
STRENGHT IN THE FINANCIAL AND CAPITAL MARKETS OF MOROCCO
Morocco is located in the heart of North Africa, bordering the Atlantic Ocean and the Mediterranean sea. Morocco financial market enrich from, rock mining and processing, food processing, leather goods, textiles, selling of arts and crafts, construction, and tourism. These are a few of Morocco financial strengths that drive its economy. In a 2006 statistic, Morocco GDP was priced at $56.72 billion, and a GDP growth rate of 6.7%. The GDP for 2006 imports and export are $21.22 billion and $11.72 billion respectively. Morocco major partners for exports are EU 71.5%, India 4.1%, U.S. 2.6%, and Brazil 2.4%. Morocco major partners for imports are EU 52.1%, Saudi Arabia 4.8%, Russia 6.7%, China 5.2%, U.S. 3.4%. Morocco’s main trade is importing and exporting. Although there are local arts and crafts found on every corner of the street, most of the locally produced arts and crafts are being exported to neighboring countries. Morocco’s principal legal exports are clothing, fish (notably sardines), phosphates, fruit and vegetables. Cannabis (marijuana) though illegal, is also an important export. The strongest point of Moroccan industry is phosphate mining. Morocco houses approximately 2/3 of the world's phosphate reserves, put it in a higher league than its major competitors, China, Russia, and the United States. Although it employs only 2% of the population, phosphate mining is responsible for half of the nation's income. Despite criticism among exporters that the dirham (Morocco currency) has become badly overvalued, the country maintains a current account surplus. Foreign exchange reserves are strong, with over $16 billion in reserves. The current government is continuing a series of structural reforms begun in recent years. The most promising reforms have been in the labor market and financial sectors, and privatization has accelerated the sale of Global System for Mobile Communications licenses in recent years. Morocco also has liberalized rules for oil and gas exploration and has granted concessions for many public services in major cities. Morocco has an extensive infrastructure to support active oil and gas exploration and production industry. Major seaports, roadways, airports, pipelines and refineries are near large cities endowed with the usual European and North American style amenities. The downstream oil industry of Morocco is well developed. The country has 2 oil refineries with a total refining capacity of 150,000 barrels per day. In January 2006, the bilateral Free Trade Agreement (FTA) between the United States and Morocco went into effect. The FTA represents an important step towards President Bush's vision of a Middle East Free Trade Area and is the first in Africa. The U.S.-Morocco FTA eliminated tariffs on 95% of bilateral trade in consumer and industrial products with all remaining tariffs to be eliminated within nine years. The negotiations produced a comprehensive agreement covering not only market access but also intellectual property rights protection, transparency in government procurement, investments, services, and e-commerce. The FTA provides new trade and investment opportunities for both countries and will encourage economic reforms and liberalization already underway. With a lower tariff, it allows more trade in Morocco that will open more financial opportunity.
Reference
HighBeam Research, LLC. © Copyright 2005
http://www.infoplease.com/ipa/A0107800.html
Bureau of Near Eastern Affairs October 2007 www.state.gov/r/pa/ei/bgn/5431
--Cbbusiness22 03:37, 2 November 2007 (UTC)Calvin Brown
[edit] Moroccan Equity Market
The Moroccan stock exchange was formed in 1929. It is located in Casablanca and is known as the Casablanca Stock Exchange (CSA). It is sometimes grouped together with Middle East markets and other North Africa (MENA) Markets. The current market was established in 1994. It has been trading electronically since 1997. The Chairpersons are, Mr. Amine BENABDESSLEM, Chairman of the Managing Board, and Mr. Omar DRISSI KAITOUNI, Member of the Managing Board & Director of Information Systems . (Casablanca Stock Exchange, 2006)
According a 2006 report, the operating revenues increased 73.6% from the previous year. The shareholders equity increased, 23.6% (Casablanca Stock Exchange, 2006). According to a 2004 report, there are 52 countries listed on it. The market cap, in billions of US dollars, is 15.9. The average daily trading volume, in millions of shares, is 2.1. It does not allow for trading of futures. Moody’s Souvereign rating is Ba1. Nominal GDP, for 2003, was 47.84 in billions of US dollars. Per capita GDP was 4,180. The inflation rate in 2003 was, a low, .5%. The estimated inflation rate was 2.5% for 2004. (Bley, 2007)
There are 14 MENA markets in which Morocco is a part of. These are Bahrain, Egypt, Israel, Jordan, Kuwait, Lebanon, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Tunisia, Turkey, and the United Arab Emirates. (Bley, 2007)
During 2005 and 2006, the Casablanca Stock Exchange (CSE) had spikes in levels of investor interest. This was partly due to the release of 10 IPO’s in 2006. During April of that year, a European branch of a Hotel group, Risma, released its IPO. It raised $30,000,000. The demand was so great that it exceeded supply, by a impressive 24 times. In June, Addoha, a housing developer, had its IPO. It made an astounding $315,000,000. This large interest in this companies IPO, made it the largest. Previously the largest was held in 2005, by Maroc Telecom. (Economist Intelligence Unit, 2007) The CSE will continue its growth experts are saying. This is partly due to industrial groups in the area beginning to list their companies on the exchange. Also, a major help to both the exchange and the companies listed on it, is the ruling to prolong the tax exemptions for newly listed companies. This is an income tax exemption and it will be extended until 2009. Previously it was thought to expire in 2007. (Economist Intelligence Unit, 2007)
The Real Estate equity in morocco is also booming. This is in part due to the massive amounts of US dollars going into the Gulf region. The real estate sector on the CSE has increased 280% over 2006. Experts are expecting the market to continue to grow at a healthy rate. This is due to the shift from the agricultural sector of Morocco. (Morocco: Real Estate Equity Correction?, 2007)
References:
Bley, J. (2007). How Homogeneous are the Stock Markets of the Middle East and North Africa? Quarterly Journal of Business & Economics , 3-26.
Casablanca Stock Exchange. (2006). Retrieved October 30, 2007, from Casablanca Stock Exchange:[1]
Economist Intelligence Unit. (2007). Financial and other services. 26-27.
Morocco: Real Estate Equity Correction? (2007). Emerging Markets Monitor , 12 (39), 20-20.
