Lhe business financing system in Morocco is still struggling to align with the standard of modern economies. Indeed, the capital market still fails to take the lead on traditional bank loans. And, unfortunately, this situation is likely to continue, since in “most of the financing that is done in favor of Moroccan companies today, the overwhelming majority comes from banks”, recalled in particular Mohamed El Kettani, Vice-President of the Professional Group of Banks of Morocco and CEO of Attijariwafa bank, during his participation in the panel on the “financing of productive investment” organized on the sidelines of the 1st edition of the national day of industry, held on March 27 last in Casablanca. To illustrate his point, El Kettani revealed that “at the end of December 2022, the outstanding amount of loans granted to companies totaled 504 billion dirhams (MMDH), up 12% compared to the end of December 2021, in full crisis, including MAD 100 billion in equipment credits”.
Only 240 companies supported in ten years
Opposite, the contribution of investment funds is very, very limited. Since between 2011 and 2021, these funds only managed to support 240 companies with a cumulative investment of only 10 billion dirhams. It’s a gigantic gap! So what should be done to remedy this situation? According to El Kettani, we must first begin by correctly posing the problem.
“We have always spoken of access to financing as a structural problem. But the real problem is rather the insufficiency of own funds which often means that the level of indebtedness exceeds reasonable ratios; and we are thus faced with difficulties,” he explained. Now, to support the private sector whose investment should represent 2/3 of the GFCF (Gross Fixed Capital Formation) of Morocco in 2035, the vice-president of the GPBM believes that it is necessary to work on several levels. At the level of the banking sector, it was decided, through several meetings held with the office of the CGEM, to work hand in hand to restructure and expand the financial capacities of companies..
And, in this regard, “there is first good news: the investment charter provides a solution to the problem of equity, because depending on the territories and according to a certain number of criteria, the State subsidy can go up to 30%. And it is this rate that banks generally ask for as equity in order to be able to finance an investment project and make the file bankable”, notes El Kettani.
Second good news: the Mohammed VI Investment Fund will be implemented soon. According to the boss of Attijariwafa bank, this will be a welcome reinforcement which should inject a real virtuous dynamic into investment in the country. Indeed, “to four, that is to say the Mohammed VI Fund for Investment, the Private Equity funds, the banks and Tamwilcom through the guarantee, there is really a way to give several companies the chance to achieve their investment projects,” he hopes. Recall that the financing of the economy by banking ended 2022 on a growth of 7.6%, with an outstanding amount of 1.059 billion dirhams.
And this, following 3% in 2021 and 4.5% in 2020 where bank credit was boosted by the efforts made to strengthen the financing of the economy in the midst of the crisis linked to the Covid-19 pandemic, in particular via the Damane Oxygène and Damane Relan ce. Note also that the latest statistics from Bank Al-Maghrib confirm the words of Mohamed El Kettani. They show that bank credit was pulled up by accounts receivable and cash credits, which continue to show a high rate. At the end of 2022, they have increased by 16%, which provides information on the rise in cash flow difficulties for companies.