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	Morocco		Info-Prod Country Guide
CHARACTERISTICS   INDICATORS   THE ECONOMY   INVESTMENT ISSUES   PROJECTS   PROSPECTS

Investment Issues Privatization Morocco boasts what many have termed the Arab world's most ambitious privatization program, with 112 firms worth US$ 2 billion mandated for sale by mid-1996. As a result of a rough economic performance in 1995, however, the government raised less than half the US$ 400 million that had been forecast from selling state-owned assets that year. Already released for public offering, 35 percent of Sonasid (the state-run steel company) through 1.35 million shares at approximately US$ 38 per share were called on 1.6 times per share. Most of the remainder will be sold to a strategic investor. A group led by Shell du Maroc bought 56 percent of Somas oil company for US$ 8.9 million. Morocco is also working on a scheme to split up the state power company into separate agencies. Morocco announced that it will soon issue privatization bonds in banks, accredited stock exchange companies and the General Treasury. The bonds will have a nominal value of US$ 117 and will be worth US$ 12 billion. They will be negotiable on the Casablanca Bourse for the coming three years and will give holders preferential options on shares. These bonds will also give the holder the right to convert them into shares in enterprises that could be privatized or to sell them at the 8 percent interest rate a year on the Casablanca Bourse. Bonds not exchanged by the end of December 1998 will be reimbursed on the basis of their nominal value with a bonus of 8.5 percent a year. Subscriptions will be opened to any individuals or companies regardless of nationality, except public insurance and credit companies, which are barred from participating in the subscriptions. During 1996, eight mutual funds were allowed to operate on the Bourse for the first time, including Wafabank, Banque Centrale Populaire, CFG stockbroker and Societe Generale Marocaine de Banques. Wafabank and CFG stockbroker were authorized to operate on the Bourse with three mutual funds each. Stock Exchange The Moroccan securities market is in the process of modernization. The single stock exchange in Morocco, situated in Casablanca, has been regarded as rather inactive. In October 1993 Morocco passed a law aiming at turning thstock exchange into a private company, with stock held by brokers and monitored by a special commission. The effect of this law after full implementation should provide investors with a new and important investment facility making Morocco more attractive to foreign capital. It is notable, however, that there are no markets in Morocco yet for trade in financial futures or other types of derivatives. Privatization measures, as discussed above, have also had an effect on the operation of the stock exchange. Casablanca Stock Exchange   December 1997 December 1996 Percent Change Volume of Transactions 32.3 20.3 58.8 Market Capitalization 118.6 75.6 56.9 All Share Index (points) 667.52 447.13 49.3 Previous Chapter Contents Menu Next Chapter

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