AFRICAN DEVELOPMENT BANK ADB/BD/WP/2014/136 28 August 2014 Prepared by: ORNA/MAFO Original: French Probable Date of Presentation to the Committee Operations/ Development Effectiveness (CODE) TO BE DETERMINED FOR CONSIDERATION MEMORANDUM TO : THE BOARD OF DIRECTORS FROM : Cecilia AKINTOMIDE Secretary General SUBJECT : MOROCCO - COMBINED 2012-2016 COUNTRY STRATEGY PAPER MID-TERM REVIEW AND 2014 COUNTRY PORTFOLIO PERFORMANCE REVIEW* Please find attached the above-mentioned document. Attch. cc. : The President * Questions on this document should be referred to: Mr. J. KOLSTER Regional Director ORNA Extension 2065 Ms. Y. FAL Resident Representative MAFO Extension 7301 Mr. V. CASTEL Chief Country Economist ORNA/MAFO Extension 6572 Mr. O. BRETECHE Principal Portfolio Officer ORNA/MAFO Extension 6533 SCCD:C.H
Transcript
AFRICAN DEVELOPMENT BANK ADB/BD/WP/2014/136
28 August 2014
Prepared by: ORNA/MAFO Original: French
Probable Date of Presentation to the Committee
Operations/ Development Effectiveness (CODE)
TO BE DETERMINED
FOR CONSIDERATION
MEMORANDUM
TO : THE BOARD OF DIRECTORS
FROM : Cecilia AKINTOMIDE
Secretary General
SUBJECT : MOROCCO - COMBINED 2012-2016 COUNTRY STRATEGY PAPER
MID-TERM REVIEW AND 2014 COUNTRY PORTFOLIO
PERFORMANCE REVIEW*
Please find attached the above-mentioned document.
Attch.
cc. : The President
* Questions on this document should be referred to:
Mr. J. KOLSTER Regional Director ORNA Extension 2065
Ms. Y. FAL Resident Representative MAFO Extension 7301
Mr. V. CASTEL Chief Country Economist ORNA/MAFO Extension 6572
Mr. O. BRETECHE Principal Portfolio Officer ORNA/MAFO Extension 6533
SCCD:C.H
-i-
AFRICAN DEVELOPMENT BANK
COMBINED REPORT
COUNTRY STRATEGY PAPER (2012-2016 CSP) MID-TERM REVIEW
&
2014 COUNTRY PORTFOLIO PERFORMANCE REVIEW
MOROCCO
Editorial
Team Regional Director:
Resident Representative:
Design Team:
Team Members:
J. KOLSTER, Regional Director, ORNA
Y. FAL, Resident Representative, MAFO/ORNA
V. CASTEL, Chief Country Economist, MAFO/ORNA
O. BRETECHE, Principal Portfolio Officer, MAFO/ORNA
D. CHARRIER-RACHIDI, Economist, ORNA
S. MANSOUR, Economist, ORNA
A. MOUAFFAK, Economist, ORNA
A. MOUSSA, Electrical Engineer, MAFO/ONEC
A. TARSIM, Senior Macro-economist, OSGE.1
B. BEN SASSI, Chief Water and Sanitation Expert, OWAS
C. AMBERT, Principal Strategist, OPSM
C. MOLLINEDO, Chief Strategist, COPS
D. KHIATI, Agricultural Expert, MAFO/OSAN
E. DIARRA, Principal Financial Economist, MAFO
F. RODRIGUES, Senior Investment Officer, OPSM2
L. JAAFOR-KILANI, Social Development Expert, MAFO/OSHD
L. LANNES, Principal Health Economist, OSHD.3
M. BOUZGARROU, Principal Portfolio Officer, ORNA
M. EL ARKOUBI, Procurements Officer, MAFO/ORPF.1
M. EL OUAHABI, Water and Sanitation Expert, MAFO/OWAS
M. GUEYE, Principal Education Economist, OSHD.2
M. YARO, Financial Management Regional Coordinator, ORPF.2
O. BEN ABDELKARIM, Chief Education Expert, OSHD.2
P. MORE NDONG, Senior Transport Engineer, MAFO/OITC
R. MAROUKI, Chief Agricultural Economist, OSAN
T. RAJHI, Chief Training Expert, EDRE.0
W. DAKPO, Principal Procurements Expert, ORPF.1
W. RAIS, Principal Financial Analyst, MAFO
Reviewers A. A. BA, Resident Representative, BIFO
R. KANE, Resident Representative, CMFO
M. NDONG NTAH, Resident Chief Country Economist, ORNA
S. KAMARA, Principal Portfolio Officer, DIRA/ORWA
K. EGUIDA, Principal Portfolio Officer, SNFO
C. CALVOSA, Country Risk Officer, FEMA
K. ABDERAHIM, Country Risk Officer, FEMA
K.HASSAMAL, Energy Expert, ONEC.2
uuu
AFRICAN DEVELOPMENT BANK
COMBINED REPORT
COUNTRY STRATEGY PAPER (2012-2016 CSP) MID-TERM REVIEW
AND
2014 COUNTRY PORTFOLIO PERFORMANCE REVIEW
MOROCCO
ORNA/MAFO
August 2014
Translated Document
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TABLE CONTENTS
TABLE CONTENTS ...................................................................................................................... i
LIST OF ACRONYMS ................................................................................................................. iv
CONVERSION RATES ................................................................................................................ v
FISCAL YEAR ............................................................................................................................... v
Executive Summary ........................................................................................................................ vi
I. Introduction ............................................................................................................................. 1
II Country Context and Developments ........................................................................................ 1
2.1 Political Developments ................................................................................................................. 1
2.2 Economic and Social Developments ............................................................................................. 1
III. CSP 2012-2016 Implementation and outcomes ....................................................................... 4
3.1. Country Development Context .................................................................................................... 4
AFD French Development Agency AfDB African Development Bank AGTF Africa Growing Together Fund AMDL Moroccan Agency for Logistics Development ANPME National Agency for the Promotion of Small- and Medium-Sized Enterprises ATM Automated teller machines CODE Committee on Development Effectiveness CPO Country Programme Officer CPPR Country Portfolio Performance Review CS Construction sector CSP Country Strategy Paper CTF Clean Technologies Fund DEPF Directorate of Studies and Financial Forecasts DEPP Directorate for Public Enterprises and Privatisation DWSS Drinking Water Supply and Sanitation EIB European Investment Bank EU European Union FA Formal approval FFCO Financial Control GDP Gross domestic product IGF General Inspectorate of Finance ISR Report on Implementation Status and Results LOLF Organic Law on Finance MAD Moroccan Dirham MAFO Morocco Field Office (of the AfDB) MCC Millenium Challenge Corporation MDGs Millennium Development Goals MEF Ministry of Economy and Finance MIC Middle-income country MIC TAF Middle-Income Country Technical Assistance Fund MSP Moroccan Solar Programme OCP Moroccan Phosphates Authority OFSD Financial Sector Development Department (of the AfDB) OITC Transport and Infrastructure Department (of the AfDB) ONCF National Railways Authority ONEC Energy, Environment and Climate Change Department (of the AfDB) ONEE National Electricity and Water Authority ORPF Procurements and Fiduciary Services Department (of the AfDB) OSAN Agriculture and Agro-Industry Department (of the AfDB) OSGE Governance and Financial Management Department (of the AfDB) OSHD Human Development Department (of the AfDB) OWAS Water and Sanitation Department (of the AfDB) PAAFE Training-Employment Matching Support Programme PACE Competitiveness Support Programme PADESFI Financial Sector Development Support Programme PAPMV Green Morocco Plan Support Programme PAPNEEI National Programme for Irrigation Water Conservation Support Project PARCOUM Medical Coverage Reform Support Programme PARGEF Economic and Financial Governance Revitalization Support Programme
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PDRTE Transport Networks and Electricity Distribution Development Programme PEFA Public Expenditure and Financial Accountability PFM Public finance management PIEHER Integrated Wind Energy, Hydro Power and Rural Electrification Programme PJD Justice and Development Party PMV Green Morocco Plan PNEEI National Programme for Irrigation Water Conservation II PNRR National Rural Roads Programme PPIP Portfolio Improvement Plan PPP Category Category – Potentially problematic project PRP Procurement Plan RAMED Medical Assistance Regime RSP Regional Strategy paper SLL Sustainable lending limit SME Small- and medium-sized enterprises TFT Multi-Donor Trust Fund for Countries in Transition TGR General Treasury of the Kingdom UA billion UA billion UA million UA million UN United Nations USD million USD million VSE Very small enterprises
CONVERSION RATES April 2014
UA 1 = MAD 12.6
UA 1 = USD 1.55
UA 1 = EUR 1.12
FISCAL YEAR
1 January – 31 December
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EXECUTIVE SUMMARY
1. The 2012-2016 Country Srategy Paper (CSP)
for the Kingdom of Morocco was approved by
the AfDB Board of Directors on 11 April 2012.
The strategy focuses on two pillars, namely: (i)
enhanced governance and social inclusion; and
(ii) support for the development of “green”
infrastructure.
2. The country enjoys good political stability as
it implements far-reaching reforms. From the
economic standpoint, Morocco has solid
performance with an average annual growth rate
of 4.2% over the 2009-2013 period despite a
difficult international and regional context. Since
2011, successive authorities have striven to
improve government efficiency and public
finance management, while seeking to preserve
macro-economic stability.
3. The indicative budget for the 2012-2014 work
programme projected a total of UA 1.191 billion
for 2012-2013 and UA 391 million in 2014. The
amount for the Bank’s approved projects from
January 2012 to April 2014 (UA 1.108 million)
is consistent with this target.
4. The Bank’s overall portfolio performance
remains satisfactory overall, with an average
score of 2.53 on 3 in 2014. This score has
remained stable since 2012.
5. The mid-term review made it possible to
update the Portfolio Performance Improvement
Plan (PPIP). The main recommendations
include continuing the organisation of quarterly
workshops and reviewing the possibility of
establishing technical assistance at MEF for close
monitoring of grants. As regards
recommendations of previous reviews, this new
PPIP repeats those aimed at guaranteeing good
quality-at-entry of loan and grant operations and,
specifically, stricter targeting of grants aligned
with lending operations as well as systematic
assessment of the management capacity of new
partners.
6. Lessons from a growth diagnosic, related to
the constraints that undermine the country’s
capacity to tackle its challenges, enabled the
Bank to confirm the two pillars and fine-tune
its support under these pillars for the remaining
period. Under the governance pillar, the Bank’s
support for 2014-2016 will focus on boosting
competitiveness, coordinating stakeholders and
streamlining social spending. Under the
infrastructure pillar, it will focus on boosting
economic competitiveness and reducing regional
disparities.
7. Furthermore, alignment on the 2013-2022
strategy was enhanced and operational
arrangements adjusted to take account of
financing constraints. In particular, the
mobilization of additional resources will be
reinforced and private sector support improved.
Special emphasis will also be laid on: (i)
increased communication on Bank operations;
(ii) selection/formulation of projects through a set
of indicators that reflect the objectives of the
strategy; (iii) civil society involvement; and (iv)
implementation of analytical work to enhance the
Bank’s consultancy role.
8. The following proposals were also retained
by the authorities to improve the performance
of Bank operations: (i) respect the deadlines for
submission of project audit reports; (ii) continue
holding quarterly meetings between the Bank,
MEF and executing agencies on the monitoring
of grants and expand such monitoring into a
comprehensive review; (iii) examine the
possibility of supporting MEF in monitoring
grant implementation; and (iv) request for regular
and quality project reports.
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I. INTRODUCTION
1.1 The 2012-2016 Country Strategy Paper
(CSP) for the Kingdom of Morocco was
approved by the AfDB Board of Directors on
11 April 2012. Through this strategy, the Bank
supports Morocco’s efforts to lay the foundation
for an attractive economy by helping the
country to develop its assets. This strategy
focuses on two pillars: (i) enhanced governance
and social inclusion; and (ii) supporting the
development of “green” infrastructure.
1.2 The CSP ends in December 2016, and
pursuant to the guidelines issued in April
20131, this combined CSP 2012-2016 Mid-
Term Review and the 2014 Country Portfolio
Performance Review (CPPR) was prepared.
Continuous dialogue with the Government and
other partners, as well as a broadbased
consultative mission organized in June 2014
(including workshops with civil society and
development partners) brought confirmation that
the Bank's intervention strategy remains
relevant.
1.3 The two pillars of the strategy have been
maintained. Under the governance pillar, the
Bank’s support for 2014-2016 will focus on
boosting competitiveness and streamlining
social spending. Under the infrastructure pillar,
it will focus on enhancing economic
competitiveness and reducing regional
disparities. The objectives of green and
inclusive growth have been addressed under the
two pillars.
II COUNTRY CONTEXT AND DEVELOPMENTS
2.1 Political Developments
2.1.1 The country enjoys good political stability
as it implements far-reaching reforms. The
constitution was revised by referendum in July
2011 to consolidate multiparty democracy,
human rights and individual freedoms. The
elections of November 2011 were won by the
Justice and Development Party (PJD) whose
Secretary-General was appointed to head the
Government. A first coalition government was
formed on 3 January 2012 and a second in
October 2013 following the withdrawal of the
Istiqlal Party from the governing coalition. The
next regional and municipal elections will be
organized in June 2015 and elections for the
chamber of advisers in September 2015.
2.1.2 At the international level, commitment to
the reform process was rewarded in 2011 with
obtainment of the status of Partner for
Democracy from the Council of Europe.
Furthermore, Morocco was a non-permanent
member of the Security Council from 2012 to
2013. During this period, it also joined the
United Nations Human Rights Council for three
years, as well as the United Nations Committee
against Torture and the UNESCO Council.
2.1.3 Morocco’s security situation remains
under control, despite a disturbing regional
context.
2.2 Economic and Social Developments2
2.2.1 From the macroeconomic standpoint,
Morocco has posted solid performance with an
average annual growth rate of 4.1% over the
2009-2013 period, despite a difficult
international and regional context. After a
slowdown in 2012 (+2.7%), the economy rallied
again in 2013 (4.4%). This bounce stems in
particular from the excellent performance of the
agricultural sector (+19%). Meanwhile, non-
agricultural activities, which had grown by 4.5%
on average over the decade, remained less
bouyant (+2.3%)3 Nonetheless, the new
automobile and aeronautic industries
experienced strong export growth (+20% and
+14% in 2013). Inflation remained low from
2009 to 2012 (1%), and stood at only 1.9% in
2013, despite the spike in the prices of some
energy products on which subsidies were
reduced. Growth prospects are good: 4% and
5% in 2014 and 2015 (AEO, 2014).
2.2.2 With regard to public finance, Morocco
tightened budget discipline to curb the deficit
that has been growing since 2009. The
authorities took several key measures to contain
this deficit in 2013, such as: (i) the reduction of
subsidies by almost 2% of GDP after the
introduction in September of a partial price
indexation mechanism for some petroleum
products; (ii) the reduction of wage costs by
about 0.4% of GDP; and (iii) the non-deferment
of investments in October 2013. Hence, the
budget deficit reduced to -5.5% of GDP in 2013
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compared to -7.4% in 2012. However, total
revenue declined by 0.5% in 20134. In 2014,
these measures continued with the suspension of
fuel-oil and petrol subsidies in January5, in an
effort to curtail the deficit to 3% of GDP by
2016. Furthermore, although the external debt
increased recently (from 24.4% of GDP in 2009
to 30.9% in 2013), it remains sustainable and
should decline from 2016. At the end of April
2014, Fitch Ratings affirmed Morocco’s credit
risk rating for its long-term debt in foreign
exchange and local currency at BBB- and BBB,
with a stable outlook6. Deficit reduction and
structural reforms account for this improvement.
2.2.3 The external current account balance
improved to -7.6% from -9.7% in 2012, despite
the decline in exports in 2013, due to a 23%
contraction in phosphate exports7. This trend
can be explained by a greater reduction in the
value of imports (-2%) than in the value of
exports (-0.8%). Foreign exchange reserves
reached 4 months and 9 days of imports in
20138, thanks to a contraction of the trade deficit
and a strong growth in FDI (+23.2% in 2013) as
well as access to international bond markets at
favourable conditions (USD 750 million raised
in May 2013).
2.2.4 Nonetheless, the geographic
concentration of exports to Europe (66%) does
not encourage the expansion of Morocco’s
market share in a context of low growth.
Furthermore, sub-regional integration remains
less dynamic. Hence, Morocco considers the
consolidation of economic cooperation ties with
Sub-Saharan Africa to be a priority. Morocco is
the second African investor on the continent and
has a growing presence in the services sector
(banking, telecommunications). In addition to
the recent visit of the King in 2013 and 2014,
which led to bilateral agreements in Africa,
Morocco is currently negotiating strategic
partnership agreements with WAEMU,
ECOWAS and CEMAC. Furthermore, the
country is building a range of infrastructure
for services (such as Casa Finance City) or
for transport to underpin these plans.
2.2.5 Morocco's banking sector is one of the
most efficient on the continent. Outstanding
credits to the economy grew in 2013 by 3.2%
compared to 5.4% in 20129. This better access
to financial services stems from a substantial
increase in the bank penetration rate and wider
geographic coverage (5,711 branches and 5,893
ATMs). However, challenges remain in terms of
financing of VSEs and SMEs as well as access
to basic banking services for communities with
modest income, the youth, women in business
and rural households.
2.2.6 Boosting global competitiveness is a core
concern. The business environment has
improved and Morocco is ranked 87th in Doing
Business 2014. Specifically, the country is
ranked 39th as regards starting a business (+14
spots)10
. On governance, however, Morocco
regressed by three spots in the 2013
“Transparency International” classification to
the 91st position. The country is ranked 77
th (70
th
in 2012) in the 2013 Global Competitiveness
Report which identifies bureaucracy as the main
private sector constraint. The report underscores
the need to pursue reforms, especially in the
following areas: (i) protection of intellectual
property (90th out of 148); (ii) innovation
(106th); (iii) labour market regulation (122
nd);
and (iv) higher education quality (102nd
).
Morocco experienced an improvement in its
logistical performance under the logistics
-300 000
-200 000
-100 000
0
100 000
200 000
300 000
2005 2006 2007 2008 2009 2010 2011 2012 2013
Figure 1: Revenue, Expenditure and Overall Balance (in MAD billion)
Recurrent revenue (net of VAT) Recurrent expenditure
Investment expenditure Overall balance
Source: Ministry of the Economy and Finance, DEPF, Morocco
107,3
151 148,4
182,8
202,1 196,4
47,8
42,8
50,2
48,9
47,848,2
40
42
44
46
48
50
52
0
50
100
150
200
250
2008 2009 2010 2011 2012 2013
Mil
lia
rds
de
Dir
ha
m
Figure 2: Trade Deficit and Cover Rate Trends
Trade deficit Cover rate (%)
Source : Office des Changes, Maroc
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performance index, improving its ranking from
113th in 2007 to 50
th in 2012 (out of 150).
However, efforts still have to be made in the
development of logistical poles to ensure higher
volume flows, reduce goods transport costs and
create jobs in the hinterland.
Table 1: Business Environment (DB-2014)
Domain 2014 2013 ∆ Starting a business 39 53 14
Dealing with construction permits 83 81 -2
Getting electricity 97 95 -2
Registering property 156 166 10
Getting credit 109 105 -4
Protecting investors 115 113 -2
Paying taxes 78 115 37
Trading across borders 37 34 -3
Enforcing contracts 83 83 0
2.2.7 Hence, the low competitiveness of
Moroccan exports is the primary challenge
of the economy. This probably stems more
from their inadequate technological content than
their cost11
.
2.2.8 Limited private sector dynamism and lack
of SMEs is the second challenge. Small
businesses tend to remain small and big
businesses remain big due to “the missing
middle". Because of distorsions in the market,
small businesses tend to rely on traditional
revenue sources while avoiding new
investments in innovative industries12
.
2.2.9 Youth unemployment remains a
constraint on social and economic stability. The unemployment rate was 9.2% in 2013
(19.3% among those aged 15-24 years, 16.3%
among graduates and 4.5% among non-
graduates). Job growth is weak partly due to
distorsions that stem from the distribution of
value-added between capital and labour.
2.2.10 Poverty and regional disparities
constitute another constraint. The poverty rate
was 6.2% in 2011 and the vulnerability rate
13.3%. Furthermore, poverty remains a rural
phenomenon. Morocco’s scores in terms of
human development and GDP per capita are
lower than those of comparable countries13
.
However, the State has undertaken many actions
to address this problem. The water and
sanitation access rates increased in urban areas
(100% in 2011). In rural areas, these rates grew
from 70% in 2005 to 92% in 2011. The
electrification plan seems to have succeeded
with a rural coverage rate of 98.1% in 2012
compared to 22% in 1996. Indeed, some MDGs
were achieved before 2015 and the others will
be attained by then (Annex 8).
2.2.11 Gender disparities in access to human
and economic development opportunities
remain strong but have markedly reduced. At
the institutional level, this trend was supported
by the gender-sensitive budgeting process in
2003 and the new Constitution of July 2011.
The Government has undertaken to increase
women’s representation in all areas, using the
Government Equality Plan as reference
framework. Efforts made to encourage primary
education for girls raised the enrolment rate to
97% in 2012. Nevertheless, in 2012, 38% of
women remained illiterate14
compared to 23.5%
of men. Moreover, the employment rate for
women stood at 26.1% in 2012. From the
gender standpoint, the reduction of
unemployment favoured men (from 13.6% to
8.4%) more than women (from 12.8% to
10.2%). This situation is reflected in the 2013
gender equality report of the World Economic
Forum which ranks Morocco 129th out of 136
countries. According to the 2013 Global Gender
Gap Report, major gender inequalities persist in
parliament, appointments to ministerial posts,
number of magistrates, directors and senior
executives in public or private companies as
well as in income. In 2013, the proportion of
women in public administration was 38%
(compared to 26% in 2009). Hence, there are
still numerous challenges that must be addressed
to reduce inequalities, especially those related to
gender.
2.2.12 The fragility of the environment and the
risks caused by climate change account for the
weak development of the Moroccan economy.
Water resources in particular are the focus of
all attention. Groundwater is reaching
saturation point and the significance threshold
has already been attained due to
overexploitation, driven sometimes by the
shortage or even absence of surface water, while
water demand is increasing. The 2011
Constitution recognised access to a healthy
environment as a fundamental right of citizens.
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Several strategies were formulated15
and
implemented through actions that improve areas
directly related to the health and living
conditions of citizens, especially: (i) protection
of water quality; (ii) regulation of air-polluting
emissions; (iii) waste management; and (iv)
impact assessments of public and private
environmental projects. The Green Morocco
Plan (PMV) is one of the pillars. It seeks to
provide sustainable support to agriculture
because this sector contributes 15% to 20% of
GDP and employs 4 million people.
III. CSP 2012-2016 IMPLEMENTATION AND
OUTCOMES
3.1. Country Development Context
3.1.1 Morocco is a middle-income country with
a GDP per capita of USD 2 924.94. Since
2011, it has also become a transition economy
that enjoys support from the Deauville
Partnership and which, since adopting the new
2011 Constitution, has been implementing
numerous reforms and speeding up the
implementation of its new development
strategies and policies.
3.1.2 In January 2012, the Government
presented the priorities of its programme
through its General Policy Statement. These
priorities mainly focus on: (i) the State’s social
action performance; (ii) improvement of
education and research; (iii) modernization of
the agricultural sector; and (iv) economic and
financial governance. During formation of the
second government of October 2013, emphasis
was also laid on improving the business
environment and boosting the competitiveness
of the national industrial fabric.
3.1.3 Since 2011, the authorities have
especially striven to improve government
efficiency and public finance management
while seeking to preserve macro-economic
stability. This led to the adoption of a new
Organic Law in relation to the Budget Act. The
Government has striven to enhance transparency
and accountability in public resource
management mainly through: (i) enhancement
of performance-based budgeting with
stakeholder involvement16
, thanks to better
access to financial information and the conduct
of PEFA; (ii) more coherent implementation
of public procurement rules; (iii)
development of electronic tools for integrated
expenditure management and administrative
simplification, which facilitate access to
common administrative services; and (iv)
improvement of the financial governance and
control of public enterprises and
establishments. Furthermore, to improve
macroeconomic balances, the Government’s
commitment to reform and budget discipline
was underscored by observers (for example,
during the energy subsidy reforms in late 2013
and 2014).
3.1.4 With regard to competitiveness, Morocco
launched the 2014-2020 Logistics Acceleration
Plan and the National Industrial Acceleration
Plan in 2014 to replace the National Pact for
Industrial Emergence launched in 2008 (which
enabled the country to develop new industries
such as aeronautics or car manufacturing). The
objectives of this plan are to: (i) increase the
share of industrial GDP in overall GDP from
14% to 23%; (ii) build new synergies between
large enterprises and SMEs (corporate
ecosystem); (iii) enhance the role of industry as
the purveyor of jobs, especially for the youth
(creation of 500,000 jobs); and (iv) optimize the
social and economic fallout from public
procurement through industrial compensation.
The new plan will also be used to guide the
transition from the informal to formal economy
through the establishment of a complete
mechanism for the integration of a very small
enterprises (VSEs) and the creation of a public
industrial investment fund that will have a
budget of MAD 20 million by 2020. With
regard to the agricultural sector, boosting
competitiveness is the core concern under the
Green Morocco Plan.
3.1.5 In a bid to combat poverty and insecurity,
the Government plans to expand social
protection while improving the targeting and
efficiency of services rendered to citizens. This
led to the generalization of the medical
assistance scheme in 2012, for instance. The
Government is working to streamline its social
action by enhancing the efficiency of transfers
and establishing a single identifier. Reform of
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the pension system is one of the next challenges.
3.1.6 As regards education and vocational
training, the emergency programme that
sought to: (1) extend the duration of
mandatory schooling in Morocco to 15 years;
(ii) put more resources at the disposal of
pupils; and (iii) guarantee better vocational
training for them, ended in 2012. The
Government is currently preparing strategies on
vocational training (2014) and education (2015).
These strategies have to address issues such as
job-relevant training, competitiveness,
entrepreneurship and elimination of skills
development constraints.
3.1.7 From 2011, Morocco initiated the second
phase of the process to institute the advanced
regionalisation system. In this regard,
decentralisation and devolution should help to
modernise State structures in the regions and
promote sustainable and integrated
development. The organic law is expected in
2014/2015. The reduction of regional disparities
also begins with investments in various regions
of the Kingdom to increase access to social
infrastructure and services.
3.2 Bank’s Positionning
3.2.1 The Bank is one of Morocco’s leading
development partners. Its active portfolio in
Morocco currently has 33 operations (loans and
grants) for net commitments of approximately
UA 1.8 billion. Apart from the Bank, the main
financial partners are: France, World Bank, EU
and EIB, which all have an equivalent level of
commitment (approximately UA 1.5 to 1.8
billion - Annex 11).
3.2.2 The Bank’s strategy for the 2012-2016
period focuses on two pillars, namely: (i)
enhanced governance and social inclusion;
and (ii) support for the development of “green”
infrastructure. These operational pillars are a
continuation of government action aimed at
consolidating the foundation of “green” and
inclusive growth by: supporting economic
competitiveness; developing the private sector;
diversifying the sources of economic growth;
increasing the State’s social support and
reducing disparities.
3.2.3 The Bank has initiated an in-depth
dialogue with the authorities on operations
identification and public reforms and policies,
shored up by budget support. Furthermore, the
presence of a field office (MAFO) facilitates
almost daily interactions with sector ministries
and bodies involved in project implementation.
In this regard, two portfolio performance
reviews were conducted in December 2012 and
2013, and a fiduciary clinic held in 201417
.
Besides, the active participation of MAFO in
events organized by the Government, civil
society, the private sector and partners helps to
provide a fuller understanding of stakeholder
needs.
3.3 Resource Allocation
3.3.1 The indicative budget of the 2012-2014
work programme projected a total of UA 1.191
billion for the 2012-2013 period18
and UA 391
million in 2014.
3.3.2 The amount for projects approved by the
Bank from January 2012 to April 2014 is
consistent with this objective and stands at UA
1.108 billion (Annex 2). This budget was
allocated to 22 projects, including four budget
support programmes, three investment
operations, two operations financed by the
Clean Technologies Fund (CTF), seven grants
from the Middle-Income Country Technical
Assistance Fund (MIC TAF) and six operations
of the Trust Fund for Countries in Transition
(TFT).
3.3.3 In particular, budget support stood at UA
391.4 million in 2012 and 2013. It included: (i)
the Green Morocco Plan Support Programme
(PAPMV-July 2012); (ii) the Economic and
Financial Governance Revitalization Support
Programme (PARGEF-July 2012); (iii) the
Training-Employment Matching Support
Programme (PAAFE-July 2013); and (iv) the
Medical Coverage Reform Support Programme
(PARCOUM-December 2013).
3.3.4Meanwhile, investment operations
amounted to UA 712 million and included: (i)
the Ouarzazate Solar Power Station Project
(May 2012); (ii) the Integrated Wind Energy,
Hydro Power and Rural Electrification
Project (PIEHER-June 2012) and; (iii) the 12th
-6-
Drinking Water Supply Project in the
Marrakesh Region (12th DWS-November 2012).
This budget also covers 2 operations financed
by the CTF (USD 100 million – Ouarzazate
Project; USD 125 million – Wind Energy
Programme).
3.4. CSP Implementation Status
3.4.1 Pillar I of CSP 2012-2016 namely,
“Enhanced governance and social inclusion”
provides for the funding of 14 operations,
including 12 in 2012-2013. Its objective is to
build on achievements in the areas of
governance and inclusive growth. In keeping
with the new constitution of 2011 which places
governance at the core of public action, the
authorities wish to channel reforms increasingly
towards grassroots management, participation
and accountability.
3.4.2 For Pillar I, the volume of operations in
2012 and 2013 exceeded the expectations of
the indicative lending programme (UA 396.1
million compared to UA 393.9 million). The
entire lending programme was implemented.
Two grants (MIC TAF) for infrastructure were
cancelled (and taken over by the EU and CTF),
but seven additional grants were formulated
(one MIC TAF and 6 TFTs to strengthen
support in the social sector (Annex 2)). Two
studies on the public sector and competitiveness
were replaced with a growth diagnostic study.
3.4.3 Pillar II, namely “Support to green
infrastructure development” provides for the
funding of 14 operations, including 10 in
2012-2013. It seeks to rely on infrastructure
development to promote green growth, which is
the priority objective of Moroccan authorities.
Although these actions preserve natural
resources, they are aimed at boosting
competitiveness and the diversification of
growth sources.
3.4.4 For this pillar, the volume of operations
in 2012 and 2013 fell below the expectations of
the provisional loan programme (UA 712.2
million compared to UA 797.5 million). Lending operations in the energy sector
exceeded projections, partly due to the early
formulation of activities for the Tangier Wind
Farm (initially scheduled for 2014). This was
counterbalanced by postponement of the
formulation of PNEEI-II (since PNEEI-I was
not yet completed due to financing constraints at
the level of the Bank) and of the Logistic
Support Project (since the Moroccan Logistics
Development Agency (AMDL) was only
created in 2013). As far as grants are concerned:
the Rural Roads Programme Impact Study was
taken over by the EU, support to the National
Logistics Observatory was delayed pending the
creation of AMDL, while the Green Growth
Study is being prepared.
3.5. CSP Implementation Results
3.5.1 An assessment of the attainment of
results set at mid-term is presented in Annex 1.
For the first pillar, the macroeconomic targets
were ambitious and the Government initiated
reforms to meet them. Reforms on access to
information, the creation of an authority in
charge of capital and insurance markets as well
as regionalisation are being pursued. For the
second pillar, objectives related to the
performance improvement and coverage of
transport, water and sanitation infrastructure are
being pursued, while those related to energy
have been met.
Execution of Pillar 1 - Governance
3.5.2 As regards governance, PARGEF (UA
100 million – September 2012) made it possible
to support the "Hakama" multi-year reform
programme. This programme seeks to improve
State efficiency in budget management and
provision of public services to promote robust
and inclusive economic growth19
. It has helped
to improve budget forecast and management
efficiency, the establishment of an institutional
framework for e-government, the reduction of
time-limits for customs clearance of goods from
40 days to 3 days and the adoption of the new
public procurements code. Furthermore, these
activities were supported with technical
assistance for "the modernisation of the debt
management organisational framework." The
financial sector was supported by the "support
project for the preparation of the Moroccan
Monetary and Financial Code”, which is a
technical assistance approved in 2012 to
strengthen capital market governance. However,
-7-
the two technical assistance operations are still
at the start-up phase. Lastly, the conduct of a
growth diagnosic with the authorities and the
Millennium Challenge Corporation (MCC)
helped to identify the main constraints to private
sector development and the structural reform
options.
3.5.3 Furthermore, as regards civil society, the
two technical assistance operations (TFT-
2013) have contributed to enhance women’s
representation in elected councils and boost the
national public consultation policy. They indeed
facilitated the organisation of the national
conferences of 2014.
3.5.4 In an effort to strengthen social
inclusion, the Bank continued its support for
better training-employment matching,
particularly in connection with the
employability of the youth and young women.
In this regard, the Bank supported the
implementation of the Training-Employment
Matching Support Programme (PAAFE) with
budget support (UA 101.9 million – July 2013).
The objective of this programme is to
improve the employability of graduates from
the educational system through: technical
education and vocational training that is more
rooted in the productive environment, improve
the relevance and management of higher
education, and provide better sector
coordination and governance. PAAFE has
specifically led to: (i) review of the training
referentials in technical education; (ii)
preparation of a bill to establish a national
agency for the assessment of higher
education; (iii) establishment of a mechanism
for the recruiment of graduates; (iv)
establishment of regimes for the delegated
management of vocational training; and (v)
improvement of governance. Concerning
training, the Bank also financed four technical
assistance operations (3 TFTs and 1 MIC TAF),
all in the start-up phase, for: (i) the creation of a
national mechanism to promote the
employability of graduates; (ii) the
establishment of an integrated system to
evaluate the quality of vocational training; (iii)
the identification of skills needs in the
construction sector by 2015; and (iv) the
creation of an e-university within the
International University of Rabat. Lastly, to gain
a better understanding of job promotion policies,
the Bank financed technical assistance (MIC
TAF, 2003) to the Ministry of the Economy and
Finance to conduct a study on inclusive growth
and employment.
3.5.5 Social inclusion was also supported
through operations in the social protection
sector. In this regard, PARCOUM III seeks to
extend basic medical coverage and broaden
access to healthcare. An initial disbursement of
EUR 70 million was made after: (i) the
establishment of an inter-ministerial committee
for medical coverage; (ii) the proposal of
scenarios for the coverage of self-employed
workers; and (iii) the mobilisation of resources
allocated to RAMED. Two technical assistance
operations approved in 2013 and in the start-up
phase have consolidated these reforms through
the preparation of: (i) a health mapping
decision-making information system for
Morocco (PRI); and (ii) the health sector
financing strategy (TFT).
Execution of Pillar II - Infrastructure
3.5.6 In the energy sector, two Bank operations
help to combat climate change and ensure
diversification of the energy mix. The
Ouarzazate Solar Power Station (23% physical
implementation rate) is being financed under the
Moroccan Solar Programme, which seeks to
install 2,000 MW of solar energy capacity by
2020. The Integrated Wind Energy, Hydro
Power and Rural Electrification Programme
(PIEHER) has already electrified 2,223 villages
(out of 7,000), representing 61,824 households.
The financing of these two operations has also
made it possible to mobilise CTF resources.
3.5.7 In the water sector, the 12th
Marrakech
Drinking Water Supply (DWS) Project (UA
125 million – November 2012), at the start-up
phase, seeks to satisfy drinking and industrial
water needs in the Marrakech region up to 2030.
The Bank also financed the study on the
drinking water supply master plan for
communities of the Moulouya river basin. The
purpose of the plan is to ensure steady drinking
water supply and sanitation in this region and
-8-
thus preserve the quality of water resources.
3.5.8 In agriculture, the Green Morocco Plan
Budget Support Programme (PAPMV) (UA
87.5 million-July 2012), which adopted an
inter-sector approach involving 5
departments20
, made it possible to implement
key measures such as irrigation water
planning21
, promotion of value chains22
,
establishment of regional environmental
observatories and the national irrigation map. In
this regard, six laws were adopted. At the same
time, the Bank instituted technical assistance for
the promotion of young farmers (MIC TAF)
with a view to addressing the problem of youth
employment in rural areas (with emphasis on
young women). Lastly, a South-South grant is
aimed at developing agricultural production by
supporting the use of biotechnologies.
3.6 Other Effects of the Strategy
Pillar I - Governance
3.6.1 Several operations initiated under the
previous CSP in the financial sector also
contribute to the attainment of Pillar I
objectives. PADESFI II made it possible to
support: (i) the financial inclusion of households
by raising the bank penetration rate from 35% in
2008 to 60% in 2013; and (ii) efforts to diversify
the economy and enhance its resilience by
increasing the number of SVEs benefitting from
a guarantee of 25% and paring down the risky
portfolio from 40% in 2008 to 6% in 2013.
Furthermore, two MIC TAF grants contribute to
the attainment of the objectives of improving
financial sector governance, namely: (i) the
project to strengthen the control of financial
markets with the Securities Ethics Board (which
is being implemented) and; (ii) the Project to
Improve the Guarantee System with the Central
Guarantee Fund (the survey conducted among
users reveals that the services rendered are
highly satisfactory).
3.6.2Lastly, the Private Education
Establishments Development Strategy Support
was approved in 2011 in the form of a grant
(MIC TAF) and its implementation has only just
started. It seeks to prepare an integrated strategic
plan for the development of private higher,
secondary and technical education and to
increase the supply of private education.
Pillar II - Infrastructure
3.6.3 As regards energy, improvement of the
energy reliability and efficiency of the
electricity network is supported by the
programme to develop electricity transmission
and distribution networks (2009). The
programme has led to the procurement of three
shielded substations and 76 km of evacuation
lines, which have protected the interconnection
with Spain. This operation is reinforced by the
implementation of technical assistance (Finish
Trust Fund) which made it possible to conduct
an energy audit of 50 companies to institute
energy efficiency plans.
3.6.4 Concerning transport, three sub-sectors
are concerned. The National Rural Roads
Programme (PNRR 2, 2007 - UA 37.5 million)
focuses on upgrading a number of roads on the
national network with a view to improving rural
road access for the population from 54% in
2005 to 80% on completion (in 2015). The
average national access rate recorded at the end
of 2013 was approximately 74%, with 13,277
km launched out of 15,500 km. In the airport
sub-sector, a UA 200 million loan approved in
April 2009, should help to increase airport
operational capacity through infrastructure
upgrade, extend the air navigation system and
reinforce ground safety facilities in the Fès,
Marrakesh, Agadir and Oujda airports. The
physical implementation status of the project
stands at 38%. Lastly, under the 2010-2015
contract-programme between the ONCF and the
State for the upgrade and modernization of
transport infrastructure and services, the Bank
granted a loan to expand the capacity of the
Tangier-Marrakech railway line (UA 250
million -2010). The physical implementation
status of the project stands at 63%.
3.6.5 In the water sector, the Bank is the
leading partner in Morocco with ongoing
commitments of over UA 429 million. In 2006,
the Bank initiated a new management method in
the water sector under the 9th DWS Project (UA
67.5 million - closed in 2013). This project
which was implemented in rural areas initiated
the decentralized management of resources. It
-9-
helped to: (i) ensure regular water supply for
380,000 rural dwellers, thus raising the national
access rate by 2.8%; and (ii) develop sanitation
in 3 towns, thus improving the national
sanitation rate by 1.5%. Subsequently, the 10th
DWS Project (2008) improved regular drinking
water supply in the major cities, while the
Rabat-Casablanca 11th DWSS Project (2011) led
to the construction of one of the biggest
treatment plants in Africa, with a capacity to
serve 9 million inhabitants. These projects have
contributed to improve water access, quality and
sustainability.
3.6.6 In the agricultural sector, the National
Irrigation Water Conservation Programme
Support Project (PAPNEEI 2009) helped to
improve water use efficiency mainly through
conversion of the irrigation mode on
approximately 5,000 hectares (out of the 20,000
scheduled) from sprinkling to drip irrigation.
Two technical support operations were
provided, namely: (i) a programme for the
protection, conservation and development of the
oases in the South (POS) (MIC TAF, from 2009
to 2013) that led to the implementation of four
rural community development plans (project
closed); and (ii) support for the development of
irrigation infrastructure (MIC TAF in 2011) for
the establishment of strategic, operational and
innovative tools (ongoing)23
.
Private Sector Support
3.6.7 AfDB support to the private sector led to
an improvement of the business environment,
thanks to reforms and the infrastructure set
up. In terms of reforms, this improvement is
characterized by the establishment of a more
transparent framework (especially in public
procurement), improved access to financing (for
small business owners) and greater access to
human capital. With regard to infrastructure, the
private sector benefits from an environment that
facilitates trade (roads and airports) and more
stable access to inputs (water and electricity).
3.6.8 The AfDB supports the private sector
through direct and indirect financing.
Financing support to the ten-year investment
programme of the Moroccan Phosphates
Authority (OCP) should in the long run lead to
the creation of 9,000 direct jobs in industrial
SMEs. Furthermore, the Bank intervenes
indirectly through investment funds. Its
interventions are fully focused and diversified
from the sector standpoint (pharmacy, agro-
industry, infrastructure, banking) (Annex 13).
Through these funds, the Bank has disbursed
close to UA 16 million as indirect participation
in the capital of Moroccan business. The Bank
also intervenes indirectly by providing financing
through regional lines of credit and participation
in pan-African initiatives24
.
3.6.9. Furthermore, the Bank´s operations
have supported a PPP approach. This is the
case in the energy sector with the Ouarzazate
Solar Power Station Project and within
PIEHER with the Tangier Wind Farm. The
same also applies in the agricultural sector under
the Green Morocco Plan (PMV): the study for
delegated management in irrigation areas and
the enabling instruments of the law on the
private agricultural board (PPP).
Other Economic and Sector Work
3.6.10 In addition, studies were conducted to
focus the Bank´s dialogue on AfDB’s
operational objectives and pillars, while
nurturing thinking on the reforms supported
in Morocco. These studies yielded the following
publications: (i) Labour Market Reforms in
North Africa; (ii) Promoting Crisis-Resilient
Growth in North Africa; (iii) The Quest for
Inclusive Growth in North Africa; (iv)
Development of Financial Markets in North
Africa; (v) Tackling Youth Unemployment in
the Maghreb; (vi) Poverty and Inequality in
Tunisia, Morocco and Mauritania; (vii)
Comparative Study on Export Policies in Egypt,
Tunisia and South Korea; and (viii) The
Political Economy of Food Security in North
Africa. Presentations were organized in the
region to facilitate dissemination.
Pan-African Dialogue
3.6.11 The holding of the 48th Annual
Meetings of the AfDB at Marrakech in 2013
enabled the Bank to initiate dialogue with the
authorities in a pan-African context. This led
Morocco to reaffirm its willingness in 2013-
2014 to position itself as a leading player in
-10-
promoting trade with Africa.
3.7. Implementation of Paris Declaration,
Accra Agenda for Action and Busan
Partnership commitments
3.7.1 The AfDB field office in Morocco
(MAFO) plays a key role in consolidating
dialogue with the Government and other
development partners. Since starting its
activities in 2006, the Bank´s partnership with
the country and coordination with other
development partners have significantly
improved. Regular dialogue between MAFO
and the authorities helps to identify problems
and the priority actions that need to be
implemented to improve on project execution.
MAFO’s role in providing close oversight
highlights all the advantages of decentralization
and of the Bank´s physical presence on the
ground. However, the fact that the new MAFO
premises are located outside Rabat since 2013
has had a profound impact on the Bank´s
capacity to implement sustained dialogue over
this period.
3.7.2 Coordination among partners is
conducted by the Moroccan Government.
However, there are thematic groups that allow
fluid exchange of information. These groups
are either chaired by the partners or the
Government. The Bank is the lead agency for
civil society and should be the lead agency for
education in 2015. It participates in all social
sector thematic groups (health, youth, migration,
social protection). Furthermore, the water sector
group, created in 2002 by EU member states,
has been open to other donors since 2005. Co-
chaired by the EU, AFD and the ministry
delegate for water, it provides a forum for sector
dialogue twice a year (the last was held in
March 2014).
3.7.3 Nevertheless, some weaknesses persist.
The Government wishes to see enhanced
coordination in the agricultural sector through
the organization of joint missions. In the social
domain, the Bank´s dialogue should be
expanded to include themes such as social
protection, social transfers and governance. The
Ministry of Transport is currently restructuring
its mode of coordination with donors in order to
pool multilateral actions (previous piloted by the
director) and bilateral actions (previously piloted
by a unit) within a central unit. The Bank will
strive to provide its assistance for the creation of
this thematic group.
3.7.4 In accordance with the Paris
Declaration, Morocco became the first country
in 2014 for which the Bank will use the
national procurement system25
.
IV. COUNTRY PORTFOLIO PERFORMANCE
REVIEW
4.1 Current Portfolio
4.1.1 The Bank´s active portfolio in Morocco
comprises 3326
ongoing operations for net
commitments of approximately UA 1.78 billion
(see Annex 6). Loans amount to UA 1.77 billion
(99.7%), or 15 projects and programmes worth
an average of approximately UA 111 million
per operation.
4.1.2 The portfolio covers six intervention
sectors: energy (34%), transport (22%), water
and sanitation (17%), social sector (11%),
private sector (9%), agriculture (7%) as well as
multisector operations (0.1%). There is a high
concentration of operations in the infrastructure
sector (90% of commitments), particularly
energy and transport (56%).
4.1.3 Public sector loans (sovereign
operations) amount to UA 1.7 billion for 13
projects. Furthermore, the portfolio includes 18
technical assistance operations: 11 with MIC
TAF financing (UA 5.4 million) and 7 with the
resources of the Trust Fund for Countries in
Transition (TFT—UA 1.4 million in 2013).
4.1.4 The portfolio includes two non-
sovereign operations (a loan to the
Moroccan Phosphates Authority and an
equity participation in the Argan Fund for
Infrastructure Development) for a total of
UA 177 million.
4.1.5 Over 25% of the Bank´s portfolio
commitments in Morocco are implemented
through co-financing arrangements. Most of
the budget support operations, such as
PARCOUM III and PAAFE, are co-financed
with other donors. For investments, specific
-11-
examples are the Ouarzazate Solar Power
Station Project, PDRTE and PNRII for which
co-financing was satisfactorily implemented.
Working documents and meeting minutes are
transmitted to the Bank for approval and
comment, while Bank missions systematically
meet with development partners. A number of
missions are conducted jointly, especially in the
financial sector where the Bank carries out
frequent short-term consultations with the EU
and WB. Lastly, in the case of the Ouarzazate
Solar Power Station Project, AfDB rules apply
to the audits while WB rules apply to
procurements. This attests to the excellent
collaboration between both institutions.
4.2 Portfolio Monitoring and Evaluation
4.2.1 The overall performance of the Bank´s
portfolio remains satisfactory overall, with a
total average score of 2.53 on 3 in 2014. This
score has been stable since 2012. Its rating
under the new EER methodology ranges from
satisfactory to highly satisfactory (3.36/4)27
. The
overall rating of the portfolio, including the two
scoring methods, has evolved favourably. The
average age of operations has increased since
2012 from 2.3 to 3.1 years (2.2 to 3 years for
loans and 2.3 to 1.9 years for grants). The
portfolio has no aged projects according to the
Bank´s definition.
Table 2: Portfolio Rating
2002 2007 2009 2011 2012 2013 2014
2.4 2.4 2.6 2.7 2.5 2.56 2.53
4.2.2 The overall disbursement rate reached
41% in mid-2014 (36.3% in 2013, 32% in
2012) following measures implemented by
the Bank and the executing agencies28
for the
following projects: (i) 10th
and 11th
DWS; (ii)
PAPNEI; and (iii) the Ouarzazate Solar
Power Station. Similarly, the disbursement rate
for grants remains appropriate (51.1%) despite
the exit of 3 grants from the portfolio in March
2014. The target of 54% by the end of 2014 is
attainable because a number of disbursements
are expected on these operations.
Analysis of the Key Performance Indicators
of Public Sector Projects
4.2.3 Compliance with Conditions.
Performance in compliance with loan
conditions remains globally satisfactory in
2014. The average deadline for effectiveness
declined from 6 to 5.1 months for loans and
from 2.6 to 2.1 months for grants since the 2013
review. In 2013, the effectiveness timeframe
was below 3 months for PAAFE (July),
immediate for PARCOUM III (December), and
4 months for the grant on the Moulouya Master
Plan Study. The reduction in the timeframe
since 2011 stems from the rapidity with which
compliance is ensured for budget support
programmes. The timeframes observed for
energy projects approved in 2012 stem from
their higher complexity, the multiplicity of
donors involved (with their respective
conditionalities) and certain prerequisites
contingent on the nature of these operations
(economic and social impact assessments;
selection of a developer under a PPP29
). For
PIEHER in particular, this will affect the
implementation of the operation and
consequently the portfolio performance30
.
Nevertheless, the “rural electrification”
component of this project is highly effective.
4.2.4 Furthermore, the transmission of
quarterly reports, including interim financial
reports, remains irregular. The quality and
regularity of report transmission has certainly
improved following: (i) the recommendations of
the last CPPR in 2013; and (ii) the transmission
of a template to executing agencies. However,
operations such as PMV or PAPNEI must
conform to the requirements.
4.2.5 In general, project financial audits have
been conducted according to the Bank´s Terms
of Reference. Besides, there is better planning
of the process to select audit firms at the level of
PPMs. Although the deadlines have not been
respected, all FY2012 audit reports for
investment projects have been transmitted to the
Bank, which endorsed them. For FY2013, 15
audit reports were still expected by the Bank as
of mid-June 2014. This situation stems from: (i)
the slow execution of the adversarial and final
approval procedure of reports drafted and filed
on time by the IGF to the project execution
agencies concerned; and (ii) the schedule
-12-
programming the transmission of financial
statements to audit firms. To resolve this
problem, the executing agencies must transmit
their annual financial statements to the IGF or
their audit firm 3 months before the requested
deadline, and request the IGF or audit firm to
intervene within one month31
.
4.2.6 Procurement Arrangements. The
overall procurement performance remains
satisfactory with an average score of 2.5 on 3
(2.6 in 2013). This performance is the result of
the close support provided in the form of
training on rules and procedures, through
workshops and targeted coaching. An example
of the highly satisfactory procurement
performance is the Tangier-Marrakech Railway
Capacity Expansion Project in which all
procurements planned for 2013 were executed
according to schedule. Nevertheless, a number
of operations and especially the 11th and 12
th
DWS Projects, the 3rd Airport Project, and the
Electricity Transmission and Distribution
Networks Development Programme (PDRTE)
experienced procurement slippages. These
delays stem from several factors including the
difficulty of expropriating land for certain
projects (PDRTE)32
or long timeframes for
adopting standard Bank documents by the
executing agencies. For most of the grants, the
procurement difficulties identified during the
last CPPR in 2013 were addressed mainly
through training, targeted support and support to
MEF.
4.2.7 Operations performance will also
improve with: (i) the operationalisation of the
letter of agreement on the use of national
procurement procedures for national
competitive bidding for the procurement of
goods and services in AfDB-funded projects;
and (ii) the outcomes of the fiduciary clinics
organized from March 201433
.
4.2.8 The overall portfolio performance is
significantly better. There is, indeed, a notable
increase in the speed of financial execution and
disbursement rates, especially in the water and
sanitation sector (10th and 11th DWS) since
early 2014, except for the 12th Marrakech
DWS. The quality of audit reports has improved,
thanks in part to the accuracy of the financial
information presented in the audited annual
financial statements for FY2012. In general,
auditors´ opinions on these financial statements
were acceptable to the Bank and the number of
Bank reservations were fewer compared to
FY2011. Nonetheless, the Bank remains
concerned by the poor scores for the annual
financial statements transmitted by executing
agencies and external auditors. Furthermore, the
transmission of interim financial reports remains
irregular. The procedure for monitoring audit
recommendations and Bank supervision
missions is neither systematic nor formalized
through a regularly updated master plan. This
situation stems from the fact that 83% of the
administrative, financial and accounting
management services of projects are not
informed by audit review recommendations at
the level of their executing agencies.
4.2.9 Activities and Achievements:
activities and achievements are generally better
than in 2013, mainly due to progress in DWS
projects. Nonetheless, the number of project
extensions, especially those financed with
grants, has increased. These extensions result
from delays in the recruitment of consultancy
firms or approval of terms of reference
(Technical Support Project for the Promotion of
Young Entrepreneurs and Technical Support
Project for the Development of Irrigation
Infrastructure). The extension of
implementation deadlines also results from the
complexity of certain projects such as the 11th
DWS. For certain loans, the non-completion of
works and/or payments (PNR II, 3rd Airport
Project) have caused additional delays34
.
4.2.10 During the workshop on grants held as
part of the review, it was proposed that a more
rigorous monitoring indicator on physical
progress status be included. It is true that
operations could have an adequate disbursement
rate and yet be inefficient in terms of physical
execution.
4.2.11 As regards exposure to risks, in 2013 the
Bank streamlined its portfolio through partial
cancellation of funds allocated to two projects
and amounting to UA 141.3 million. In 2013,
the portfolio no longer had any risky projects.
Nonetheless, in March 2014, the 12th DWS was
-13-
classified as a PPP, since its commencement
was delayed by the cancellation of AFD
financing, among other reasons. The Bank is
working with ONEE to speed up procurements
and ensure a first disbursement in July 2014 (17
months after its approval) so that the project can
be removed from the PPP category35
.
4.2.12 A number of operations finalized end-
December 2013 were financially closed as of
31 March 2014, namely two grants: POS,
Haouz Groundwater Replenishment, and the 9th
DWS loan. These projects show satisfactory
results and their balances were either cancelled
or are in the process of cancellation (9th DWS).
4.3 PPIP Implementation Status
4.3.1 The implementation of the 2013 PPIP is
satisfactory: project quality-at-entry and
monitoring have improved. The project
portfolio has also been enhanced. Portfolio
operations have experienced no supervision
delays. The maturity of projects in conducting
programming is analysed in terms of the
finalisation of technical studies36
. Teams
responsible for project design currently coopt
procurement and financial management experts.
4.3.2 Since March 2014, there has been an
upsurge in training thanks to the fiduciary
clinics organised to acquaint the executing
agencies with Bank rules and procedures.
4.3.3 Since the last portfolio review in 2013,
the Bank has significantly restructured its
operations with a view to streamlining its
portfolio and generating financing margins for
new operations. This pro-activeness led to the
cancellation of UA 141 million through
restructuring of the 3rd
Airport Project, as well
as the partial cancellation of the loan for the 11th
DWS Project37
. These cancellations of non-
performing components were motivated by
enhanced dialogue with partners, savings
generated during the procurement process, or
the use of new and cheaper technologies while
maintaining the initial project targets (11th
DWS). These cancellations freed up resources
for the financing of PARCOUM III (approved
by the Board approved in late 2013).
4.4 Bank Group Performance
4.4.1 The Bank’s performance remains
satisfactory. MAFO’s proactiveness helped to
improve certain project performance indicators,
including those relating to compliance with
conditionalities and financial performance.
Project supervision (over 74% undertaken by
MAFO) as well as proximity to partners and the
many training sessions attest to MAFO’s
dynamism through the entire project cycle.
Upstream, the programming of fully mature
projects has been well mastered thanks to a
constant dialogue with the authorities and
partners whose involvement should be increased
at various stages of the project cycle. Active
attention to quality-at-entry will help to achieve
significant progress for future operations
identified. More realistic conditionalities for
operations, submission of documents that fulfill
the requisite Bank conditions, reduction of
timeframes for forwarding such documents and
dialogue with the authorities remain crucial
determinants.
Table 3: Portfolio Performance
Indicators 2011 2012 2013 Mid-
2014 Portfolio of Operations
Number of projects 27 27 28 33(
Projects managed by MAFO (%) 50% 58% 74% 74%
Total commitments (UA billion) 1.8 2 2.3 1.8(2)
Risky projects (%) 0 1 0 1(3)
Risky commitments (%) 0 15.5 0 7%
Rate of audit submission (%) 100 100 038 NA
Portfolio Management Average effectiveness timeframe (month)
6.9 6.4 6 4.9
Proactivity index (%) - - 100 NA Projects supervised at least twice/year
(%) - 50 70 100
Number of grant proposals initiated by
MAFO and approved - - 6 2
Number of files processed on time /
total number of files received -
-
62/11
4
23/47
Sector experts posted to MAFO 4 6 7 7
Fiduciary experts posted to MAFO 1 2 2 2
Projects approved in the course of the year Project 3 8 5 4
Commitment (UA million) 421 947 204 245
4.5 Country Performance Outcomes Based
on the Questionnaire on Portfolio Quality
4.5.1 The answers to the questionnaire on
portfolio quality were discussed with the
executing agencies present at the feedback
workshop. Quality-at-entry as well as the
conditions precedent to effectiveness and first
disbursement were deemed appropriate.
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Although the executing agencies deemed
MAFO´s procurement service to be competent,
they still expressed the wish to shorten the time
limit for processing Notices of No Objection
(NNO). The agencies expressed their
satisfaction with the disbursement and audit
processes.
4.5.2 The proposals identified by the executing
agencies to improve portfolio quality include:
(i) anticipation of land-related problems during
operations design; (ii) simplification of
procurement procedures by focusing on ex post
controls; (iii) increase of NNO thresholds to
strengthen the validation of procurements at
MAFO level; and (iv) the possibility of
introducing an information system and
ultimately an electronic signature for
disbursement requests.
4.6 Conclusions of Meetings with
Stakeholders
4.6.1 Two workshops and one fiduciary clinic
session (specifically on the consultant
recruitment process) were organized during the
review. These workshops were: a specific
workshop on grants as well as the dialogue and
feedback workshop on the 2014 portfolio
review. Apart from its recommendations, this
workshop helped to address the obstacles facing
some projects (grant on private education).
Henceforth, quarterly tripartite meetings will be
organized between MEF, MAFO and grant
beneficiaries. Following a discussion on
portfolio performance and the identification of
measures to be implemented for certain
operations, the final workshop defined the
recommendations presented as Annex 10.
4.7 Revised PPIP
4.7.1The new Portfolio Performance
Improvement Plan (PPIP) focuses on more
intensive monitoring of grant operations. The
key recommendations include the need to
continue organising quarterly workshops and
reviewing the possibility of establishing
technical assistance at MEF for close
monitoring of grants. As regards the
recommendations of previous reviews, this new
PPIP repeats those aimed at guaranteeing good
quality-at-entry of loan and grant operations,
stricter targeting grant operations aligned with
lending operations and systematic assessment of
the managerial capacity of new partners.
V. EXPERIENCE AND LESSONS
5.1 Bank Group
Lesson 1: Confirmation of Pillars and Fine-
tuning of the Areas of Focus for 2014-2016
Constraint Assessment Results
5.1.1 In 2013-2014, AfDB conducted a growth
diagnosic at Government’s request, as part of
preparations for the 2nd
MCC Compact. This
study helped to analyze the constraints on
growth and private investment. Several dialogue
workshops39
bringing together all stakeholders
were organised within this framework.
5.1.2 The main constraints to private-sector-
driven economic growth that affect
competitiveness, job creation, entrepreneurship
and innovation are of three types. Firstly, it was
noted that microeconomic distortions (fiscal and
legal distortions, land, labour market,
governance) affected the business environment.
Secondly, the educational system and vocational
training are unable to meet private sector needs
in terms of quantity and quality. In particular,
public spending statistics on education show
that Morocco exceeds all comparable countries,
with a share of 24.8%, whereas such
investments remain low in the secondary and
higher education subsectors40
. Good
governance and coordination among
stakeholders appears to be essential within
this framework. Furthermore, innovative
capacity must be accompanied by the pursuit of
efforts in infrastructure and better coordination
of public and private stakeholders. Lastly,
certain industrial subsectors, including
agroindustry, were identified as strategic to: (i)
stabilising growth (a sector that is highly
dependent on rainfall and represents 14% of
GDP); (ii) creating wealth and jobs with high
capital returns (130% despite the limited
investments) and the possibility of upscaling.
Good governance and coordination (at sub-
sector level and for water resource management)
appeared to be fundamental within this
framework.
-15-
5.1.3 Social and environmental inequalities
and challenges were also identified. Firstly, the
issue regarding the performance of the State´s
social action was raised. Simultaneously,
reforms that help to boost competitiveness,
implement efficient social safety nets and
maintain macroeconomic balances (transfers,
pensions, unemployment insurance) must be
implemented. Secondly, efforts initiated to
reduce regional disparities (especially in
infrastructure) must continue. Lastly,
coordinated water management seems crucial
for ensuring the sustainability of this resource.
5.1.4 The authorities are actively engaged in
addressing these constraints which undermine
the country’s capacity to overcome the
challenges presented in Section 2.2.
Government’s priorities presented in Section 3.1
translate into strategies that yield reforms and
investments. In turn, these help to improve
governance and competitiveness, the efficiency
of the State´s social action and the economic
and social development of the various regions.
5.1.5 The lessons from this diagnosis on the
constraints that undermine the country’s
capacity to tackle the challenges presented in
Section 1, enabled the Bank to confirm the two
pillars and fine-tune its support under these
pillars for the remaining period (Table 2).
Table 2: Alignment between the I-CSP, Intervention Pillars and the Strategic Framework
Growth Diagnosis (2014) (AfDB-Government-MCC)
Chapters II & V Country Strategic Framework
2012 & 2013 Policy Letters
Chapter III
CSP Pillar
2012-2016 Chapter V Challenges Constraints
Low export
competitivenes (2.2.7) Microeconomic distortions (fiscal, land, legal, labour
market, governance) (5.1.2) Improvement of economic and
financial governance (3.1.3) Governance (5.1.5)
Low private sector
dynamism (2.2.8)
Innovation capacity must be accompanied by
infrastructure and stakeholder coordination (5.1.2)
Improvement of the business
environment and competitiveness
(3.1.4)
Governance (5.1.5)
Infrastructure (5.1.9)
Infrastructure, Agriculture et
Regionalization (3.1.7) Governance (5.1.5)
Infrastructure in the regions to be consolidated (5.1.3) Infrastructure (5.1.10)
Poverty and regional
disparities (2.2.10)
Improvement of the performance
of the State´s social policy (3.1.5)
and regionalisation (3.1.7)
Governance (5.1.6)
Poor performance of social policy (5.1.3) Infrastructure (5.1.10)
Youth unemployment
(2.2.9) Inefficient educational and vocational training systems
(5.1.2) Improvement of education and
training (3.1.6) Governance (5.1.5)
Strategy Pillars and Interventions
5.1.6 It is proposed that for the 2014-2016
period, Pillars I (Goverrnance) and II
(Infrastructure) be kept consistent with the
Bank´s Ten-Year Strategy. Under Pillar I, the
Bank´s action will support government actions
aimed at improving governance, the efficiency of
State action and public finance management
through: (i) improvement of competiveness and
the business environment within the economy;
and (ii) streamlining of social spending. These
two dimensions are closely related
(competitiveness can be boosted only if reforms
are accompanied with more efficient social
action). Under Pillar II, emphasis will be laid on
competitiveness and reduction of regional
disparities, with focus on the three sectors: water,
energy and transport. This approach is based on
the government programme aimed at improving:
(a) economic and financial governance; (b) the
business environment and competitiveness; and
(c) performance of the State´s social policy. It
also allows for supporting new strategies
(industrial, Green Morocco) and major reform
areas (competitiveness, social safety net,
education). This rich yet targeted approach is
also a reflection of the fact that: (1) Morocco is
the Bank´s first partner, with a sophisticated
development programme; (2) the themes
addressed were anticipated in 2011 and were
broached long before the Ten-Year Strategy; and
(3) there was continuous commitment to these
sectors during formulation of the provisional
loan programme over the last five years. This
approach is consistent with the Bank´s strategies
for developing governance, the private sector,
human capital and energy.
-17-
Pillar I: Governance
5.1.7 Under this pillar, lending operations
during the remaining period will seek to
improve public, economic and financial
governance as well as create jobs while
enhancing the efficient use of public
resources. In this regard, the Bank will continue
its support to the Government’s multi-year
reform programme through the Financial and
Insurance Sector Development Support
Programme (PADESFI III and PADESFI IV)
and the Competitiveness Support Programmes
(PACEI), both of which will seek to mitigate the
microeconomic distortions identified through the
growth diagnosic and improve access to
financing. Emphasis will be laid on two priority
sectors. Improvement of the modernization and
competitiveness of the agroindustrial sector
through reforms that allow better coordination of
the stakeholders in order to eliminate constraints
to the development of value chains while
preserving resources (including water) will be at
the core of the Sector Competitiveness Support
Programme - GMP. The governance and
coordination of stakeholders in the Ministry of
Education and Training form the core of the
Sector Competitiveness/Training-Employment
Matching Support Programme. This programme
will emphasize the efficient use of public
resources within this ministry and lead to the
improvement of governance, management,
performance and coordination of the higher
education system to enable it to better respond to
private sector needs. Furthermore, support will
be provided to integrate the green dimension and
encourage PPPs. Non-sovereign operations that
help to improve the business environment,
competitiveness or the structure of value chains
will also be considered.
5.1.8 Furthermore, lending operations will seek
to boost the efficiency of the State´s social
action. This will start with supporting reforms
that lead to streamlining of expenditure,
stakeholder coordination and better targeting of
beneficiaries to accompany reforms that should
improve the business environment in a socially
acceptable manner (Social Sector Governance
Support).
5.1.9 In consultation with MEF, reforms will be
supported through the implementation of
targeted technical assistance especially at the
level of: (i) control organs (IGF, Audit Bench);
(ii) the General Treasury of the Kingdom to
support the implementation of public
procurement reform; (iii) the Directorate for
Public Enterprises and Privatisation; and (iv) the
Ministry charged with modernising the
administration with a view to improving the
quality of public services rendered to citizens. To
that end, the Bank will provide its contribution to
the conduct of the PFM performance
measurement diagnosis based on the PEFA
methodology. Training/employment matching
will be supported through labeling of training
programmes and adaptation of the core
competency and trades reference guide to the
logistics sector. Furthermore, technical
assistance to the National Agency for the
Promotion of Small- and Medium-sized
Enterprises (ANPME) as well as the study on
the establishment of a women´s investment
fund should supplement this mechanism.
Lastly, under the Social Sector Governance
Support Programme, the technical assistance
actions being identified will make it possible to
streamline spending through the preparation of a
national population register, an Integrated
National Management and Information System
for Grassroots Medical Coverage, and
reinforcement of the Regulatory and Control
Mechanism in the Insurance and Pension Sector.
Pillar II: Infrastructure
5.1.10 Support to infrastructure development
will focus on essential factors of production:
water, energy and transport. It will help to
improve the business environment and boost
competitiveness while serving as a vector of
innovation. The supported infrastructure will also
contribute to reduce regional disparities (and
better integrate the regions into the national
economic fabric) and boost the sophistication of
the economy. Support to these investments will
be provided in a manner that promotes the green
dimension and PPPs.
5.1.11 As regards boosting competitiveness,
infrastructure support will entail developing
areas that facilitate Morocco´s integration into
the regional and global value chains (port),
while connecting such infrastructure to
hinterland Morocco. This will include: (i) the
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Railway Infrastructure Consolidation Project
between Settat and Marrakech; (ii) the Nador
Port Project which will position Morocco as a
strategic stakeholder in hydrocarbons refining,
storage and transporting; and (iii) the national
logistics development strategy. Furthermore,
financing of the Ouarzazate Solar Power Project
Phase II (500 MW) will help to bring innovation
into the economy. Lastly, the line of credit
extended to one bank will be beneficial to
infrastructure and SME projects in Morocco and
in Sub-Saharan Africa (3 infrastructure projects
and 50 SMEs financed by 2022).
5.1.12 As regards the mitigation of regional
disparities, the Bank will adopt an integrated
water management approach with: (i) Phase II of
the National Irrigation Water Conservation
Programme Support Project to ensure the
sustainable water resource management and
improved productivity of irrigation areas; and (ii)
the 13th Drinking Water Supply Programme. To
ensure that the regions are more economically
integrated, the Bank will consider financing
Phase III of the National Rural Roads
Programme.
5.1.13 With regard to technical assistance
and in consultation with MEF, it is proposed
that capacity-building be conducted in the
area of PPP (DEPP, ONCF, ONEE) with, for
instance, the Project to sub-contract
management of ONEE´s commercial risk.
There are also proposals to support the
development of strategic visions: (i) for transport
through the national logistics development
strategy based on the multimodality development
and transport coordination study; (ii) for water
and based on an integrated approach through: (a)
strategic review of the National Sewage and
Water Treatment Programme; (b) support to the
National Irrigation Water Conservation
Programme; (c) support to the association of
agricultural water users; and (iii) for energy
through the strategic reflection on the energy
sector.
Expected Outputs and Targets
5.1.14 The CSP results monitoring
framework matrix is presented in Annex4. It
was revised in accordance with new
commitments and to take account of the lessons
learnt from the first implementation period. In
particular, more quantitative indicators were
included. Nevertheless, the results are heavily
dependent on the lending scenario that will be
retained (see paragraph 5.1.17).
5.1.15 With respect to the “governance” pillar,
structural and sectoral reforms will be
supported to accompany the qualitative
transformation of the country´s institutional
framework. The Bank´s action, executed mainly
through budget support, will help to: (i) boost
competitiveness and streamline the State’s social
action with reinforcement of Morocco´s
economic and financial governance
(administrative reforms, insurance and pension
systems, decentralization, development of online
services, operationalization of the PPP law,
transparency in public procurement and
reinforcement of control organs, etc.); and (ii)
develop skills and transform sub-sectors
(modernization of agriculture, tailoring the
educational system to the needs of businesses).
Such budget support will be supplemented with
targeted technical assistance to facilitate reform
implementation.
5.1.16 Under the “infrastructure" pillar,
investment projects that facilitate the
development of basic, core or innovative
infrastructure will be supported. This approach
will enhance the appeal of the regions and their
access to basic public services (access routes,
holistic water resource management), support
innovation and boost national
competitiveness(port, train, clean energy).
Lesson 2: Enhance alignment with the
2013-2022 strategy
5.1.17 Both the Government’s action and the
Bank’s commitment during the 2014-2016
period are seamlessly consistent with the green
and inclusive growth objectives of the Bank’s
Ten-Year Strategy. It was agreed at mid-term
that the “inclusive” and “green” growth targets
had to be promoted with the two pillars. This is
not a strategic reorientation but rather allows for
a reflection of the Bank’s ongoing action. The
“inclusive” aspect will be promoted under the
Governance Pillar through support for the
establishment of a framework that facilitates: (i)
State social action. The Infrastructure Pillar will
facilitate: (i) integration of the regions in the
national economic fabric; and (ii) citizen access
to basic infrastructure. “Green” growth will be
supported through the implementation of reforms
that promote green growth with the
"competitiveness” programmes of the
Governance Pillar. Under the Infrastructure
Pillar, “green” growth will be supported through
financing of infrastructure and strategies that
will: (i) promote integrated water management to
help Morocco tackle its greatest environmental
challenge; (ii) reduce the carbon footprint (solar
energy, railway transport); and (iii) be adapted to
climate change or ensure better adaptation (drip
irrigation). Water resource conservation will be
supported by an array of mechanisms: budget
support (Competitiveness-GMP), investments
(DWS and PAPNEII II), TA and PPP.
5.1.18 The crosscutting themes of the Ten-Year
Strategy will also be better covered after this
review. With regard to “gender”, reform
programmes (especially PADESFI III and IV and
the Training-Employment Matching
Programme) will ensure that special measures
are taken to enhance women´s integration into
the economic fabric and that they particularly
benefit from the State’s social action (Social
Sector Governance Support Programme). Their
participation in decision-making will also be
supported through the Training Kit for Women in
Elective Bodies, which is being prepared.
Grassroots infrastructure programmes (DWS,
PAPNEI II) will ensure that women are closely
involved in their implementation. As regards the
“fragility” aspect, the programme will be
designed to respond directly to the “fragilities”
identified in Sections 1 and 2: (i) improvement of
the stability of the macroeconomic framework
(through reform support); (ii) competitiveness
and lack of private sector dynamism (through
reform and infrastructure support); (iii)
unemployment and especially youth
unemployment (through direct employment
created by infrastructure, entrepreneurship
support, and education-employment matching
support); and (iv) environmental fragilities,
especially water (green dimension of the
programme). Lastly, “food security” will be
improved by supporting agricultural sector
sophistication (Green Morocco and technical
assistance on value chains), development of
agricultural productivity (PAPNEI II) and better
connection through transport infrastructure from
farming areas to processing and consumption
centres (farm-to-market roads, roads, railway
infrastructure).
Lesson 3: Adjustment of operational
methods during implementation
5.1.19 Risk appreciation trends at the regional
and national levels will influence the Bank´s
intervention level. In this regard, three scenarios
have been designed at mid-term to introduce the
different levels of commitment possible,
depending on changes in the Bank´s lending
capacity, with maximum thresholds as follows:
(i) low scenario: UA 320 million; (ii) median
scenario: UA 450 million; (iii) high scenario: UA
600 million (Annex 3). Depending on changes in
the country`s priorities and the maturities of the
various projects, there will be a certain amount of
flexibility in the selection of projects that fall
under these various scenarios.
5.1.20 Following this review, and in a bid to
facilitate the mobilisation of additional
resources, the Bank will embark on a series of
co-financing arrangements and optimize the
contribution of funds such as the CTF, the
Africa Growing Together Fund (with the
People´s Bank of China) or Africa 50. The
objective is to raise a minimum of UA 1.4
billion.
5.2.21 Apart from the support provided
through reforms, after this review, the AfDB
will seek to actively support the private sector.
Potential funds were earmarked to that end under
the 2014 provisional programme and for the
median and high scenarios for 2015. Such
support could also be provided by using venture
capital for investments through capital
investment funds that are not calculated as part of
the Bank´s commitment limits for the country.
This approach which supplements the “green
field” project will help to address the absence of
SMEs. Multi-country funds also provide an
opportunity for geographic diversification. The
PPP approach will be actively supported by the
projects, reform support and technical assistance
(Annex 4).
-20-
5.1.22 In a bid to improve transparency,
relevance and the Bank’s visibility, it was
agreed at mid-term to lay emphasis on: (i)
enhanced communication on operations; (ii)
selection of projects through a set of indicators
that reflect strategic objectives; (iii) civil society
involvement; and (iv) implementation of
analytical work to strengthen MAFO´s advisory
role by assigning it greater responsibilities.
5.1.23 Furthermore, it was noted at mid-term
that the Bank needs to guide Morocco in its
determination to position itself as a leading
stakeholder in economic relations with the rest
of Africa, including North Africa. Specifically,
a taskforce involving other representations and
sector departments could be set up to institute
strategic surveillance and operationalize this
support by guiding both public and private
stakeholders. This reflection on large-scale
regional activities will be done in synergy with
preparation of the RISP, which considers specific
support to AMU. Furthermore, the Bank will
accompany these plans with policy advice
(opportunities and weaknesses during hub
development; analysis of tariff barriers with
Africa by MAFO) and targeted technical
assistance (dual listing on the Casablanca Stock
Exchange and the West African Regional Stock
Exchange – Creation of a specific logistics area
for Africa). The potential financing of a line of
credit to one bank will also help to advance
Morocco’s African plans.
5.2 Government
5.2.1 The following proposals were made to
improve performance of the Bank´s action: (i)
comply with deadlines for the submission of
project audit reports by urging executing
agencies to transmit their annual financial
statements on time to the IGF or the auditors; (ii)
continue holding quarterly meetings between the
Bank, MEF and executing agencies on the
monitoring of grants, and expand such
monitoring into a comprehensive review; (iii)
examine the possibility of supporting MEF in the
monitoring of grant implementation; and (iv)
request for regular and quality project reports.
5.3 Partners
5.3.1 During the workshop with civil society, it
was agreed to: (i) systematically involve civil
society in the project cycle and in particular
during budget support; and (ii) actively publicize
the Bank´s activities within civil society.
5.3.2 During the workshop with technical and
financial partners, it was agreed to: (i) enhance
partner coordination in the agricultural and
transport sectors; and (ii) better disseminate the
Bank´s studies.
VI. CONCLUSION AND RECOMMENDATIONS
6.1 Summary of Conclusions
6.1.1.The two pillars of the strategy, namely: (i)
governance; and (ii) infrastructures, continue
to be relevant for the 2014-2016 period and
consequently remain unchanged. The Bank´s
action will focus on competitiveness and
effective social action under the “governance”
pillar as well as the reduction of regional
disparities and competitiveness under the
“infrastructure” pillar.
6.1.2 The portfolio was streamlined and its
performance remains satisfactory with an
improvement noted at the level of grant
implementation. It is necessary to carry on with
the efforts initiated in 2013 so as to continue
improving the portfolio performance.
6.2 Key Recommendations
6.2.1 CODE is invited to consider and adopt the
Mid-Term Review of CSP 2012-2016 and the
2014 RPPP41
.
ANNEX 1: RESULTS MONITORING
Mid-term Targets Status Comments and Remarks
/Pillar I: Governance Budget balance (net of privatization) -1% of GDP Ongoing Budget deficit, net of privatization, reduced to 5.5% of GDP compared to 7.4% in 2012. Containment of wage bill to 10.5% of GDP
Ongoing
The public service wage bill, with MAD 98 billion in 2013, represents 11.2% of GDP. The
financial impact to be generated by an increase of the minimum wage (from July 2014) should greatly affect the general wage bill (which stands at approximately MAD 110
million per year). Inflation contained at below 3%
Attained Thanks to a cautious monetary policy, inflation stood at 1.9% in 2013 and should fall to
0.9% in 2014. Outstanding external debt limit: 25 % of GDP.
Not attained The outstanding external debt increased to 26.9% of GDP in 2013 compared to 25.7% in 2012.
Total debt: 50% of GDP Not attained The outstanding treasury debt increased to 63.5 % of GDP in 2013 compared to 59.7% in
2012. GDP growth rate of 4%
Attained Growth rate of 4.4% in 2013, driven mainly by domestic consumption and public
investment. Widespread presentation of administrative procedures for users on the websites of government services
Partially
attained The development of e-government will lead to an increase in the number of websites, the number of online services and downloadable online forms.
Instruments for the implementation of public action
territorialisation process Ongoing As part of the effective implementation of the LOLF, which has experienced a significant
slippage on the schedule. Institution of a national entity to monitor and assess the
regionalisation, decentralisation and devolution processes. Ongoing As part of the effective implementation of the LOLF, which has experienced a significant
slippage on the schedule. Development and commercialization of agropoles Partially
attained Action plans for the promotion of agropoles were adopted and commercialization plans are being implemented: 30% in Berkane and 50% in Meknès.
Financial resources for the development of an irrigation area,
under a PPP, are available. Partially
attained Dar Khroufa (22,000 hectares) feasibility and structuring study conducted.
National Agricultural Advisory Board operational Attained The first Board meeting was chaired by the Head of Government in September 2013 in
Rabat. Improved household access to the financing of social housing
Attained Approximately 100,000 households receive financing guarantees for the acquisition of social housing.
Capital and insurance markets authority created Partially
attained
An explanatory statement of Bill No. 53.08 on the Moroccan Capital Markets Authority
has been presented. The enabling instruments are being awaited to ensure full
implementation of this reform. Implementation of the mechanism to combat youth unemployment Attained Establishment of a mechanism for the recruitment of graduates.
PAAFE supports the component relating to improvement of the governance of AREFs
mainly through the establishment of internal audit units, the appointment of external
auditors and the training of administrators responsible for financial management and contracts. Furthermore, audit of PUEN’s higher education component commissioned at the
PAAFE’s request. Development of dynamic partnerships between businesses and ETFP/higher education Partially
attained
Support for the development of PPPs in the form of delegated management and CFA/IE of vocational training establishments and the diversification and professionalization of higher
education courses will continue. Labour market flexibility is improved Ongoing This issue will receive potential support during the rest of the CSP
PILLAR II - Infrastructure ONCF logistical zones and platforms connected to the
railway (75%) Partially
attained
Of the two logistics platforms programmed under this contract programme, only one (Sidi-
Ghanem) is being completed and is also connected to the railway. As regards the second (Zenata) which is not considered under this project, the works have not yet started.
Construction works on the third line between Kenitra and Zenata to connect the logistics
platform should be completed latest end-December 2016. Establishment of a national logistics observatory (ONL)
Ongoing The Moroccan Logistics Development Agency (AMDL) was only effectively created (prior to the project) in 2013.
Upgrading of 20,000 sub-contractors and 35,000 VSEs of
logistics operators (75%) Ongoing Information of the training of logistics sector operators can only be obtained from AMDL
or CGEM. Regulation of the logistics services sector (creation of AMDL
and ONL) Partially
attained Only AMDL was created.
3rd railway line of 147 km between Tangier and Casablanca devoted to freight and container transport, and upgrade of the
Kenitra-Casa and Settat-Marrakech (75%). Ongoing Component 1 – Increased capacity for the Casa-Kenitra segment: attained 50%.
Increase of the operational capacity of the Fès, Casablanca
and Marrakech airports Ongoing An average physical progress status of 38% has been recorded.
Upgrade of national network roads (75%) Ongoing
The average national access rate recorded at end-2012 was approximately 74% (connection rate: with 13,277 km launched out of 15,500 km) – figure updated in
November 2013
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Rehabilitation/consolidation of protection facilities in 7 ports Not attained Cancellation: non-performing Percentage of electricity generated through renewable energy is 20% Attained The percentage of renewable energies in total electricity production is up to 27.2%.
The national electrification rate is 85%, Attained The rural electrification rate was 98.06% at end-December 2013. - Audits conducted in industry;
- Moroccan audit firms available Attained Conduct of 40 audits in 20 agricultural businesses and 20 businesses dealing in chemicals
and parachemistry, textiles and hides. Improvement of the water production system in settlement
areas and increased access to drinking water for rural communities
Ongoing Works on the 10th DWS project have progressed at an overall rate of 70%. It will make it
possible to improve the quantity and quality of drinking water supply for approximately 3 million persons.
PNEEI-1 completed and is followed by PNEEI-2 Ongoing Overall, the project has attained a physical execution rate of 45%.
PNEEI-2 is scheduled for 2015. PNEEI monitoring/evaluation system available
Ongoing A consultant was recruited as part of technical support (MIC grant for irrigation
infrastructure). A first version is in place and will be completed in September 2014.
-23-
ANNEX 2: IMPLEMENTATION OF THE 2012-2013 LENDING PROGRAMME
OPERATIONS
2012 2013 2014 2012 2013 2014 Comments
Pillar I FORECASTS ACTUAL
Lending Programme (UA
million) (UA
million) (UA
million) (UA
million) (UA
million) (UA
million)
Green Morocco Plan Support Programme 90 87.5 Training-Employment Matching Support
Programme 100 101.9
Public Administration Reform Support Programme - PARAP 100 100 Re-entitled PARGEF: Economic and Financial
Governance Revitalization Support Programme Financial Sector Development Support
Programme (3rd phase) – PADESFI III 100 Being considered for 2014 (forecast)
Medical Coverage Reform Support Programme
(3rd phase) – PARCOUM III 100 102
Non-Lending Programme (i) Technical Assistance to MTEF Development
(MIC grant) 0.50 Not executed due to a change of strategic vision
by the authorities
Study on REC preparation in logistical trades
(MIC grant) 0.50
Delay in the creation of a Moroccan logistics
agency. TA confirmed for 2015 - labeling of
training programmes and adaptation of the core competency and trades reference guide to the
logistics sector (OITC) Study on the relationship between inclusive
growth and employment in Morocco (EES) 0.35 0.59
Study on the competitiveness of the Moroccan
economy (EES) 0.50 Replaced by the AfDB/MCC Growth Diagnosis
Study conducted in 2013/2014 Public sector reform: Assessment and outlook
(ESS) 0.50 Not attained
Technical assistance for the promotion of young
agricultural entrepreneurs (MIC grant) 0.50 0.57
Modernisation of the debt management
organizational framework (MIC grant) 0.50 0.54
Drafting of the Monetary and Financial Code
(MIC grant) 0.50 0.49
Technical assistance for the establishment of a
GIS and a health map (MIC grant) 0.50 0.38
Additional Operations (non-lending) e-University UIR (MIC grant) 0.77 National mechanism to promote the employability
of graduates (TFT grant) 0.23
Establishment of a professional integrated quality
assessment system (TFT grant) 0.13
Identification of construction sector skills needs
by 2015 (TFT grant) 0.30
Technical assistance to the health sector financing
strategy (TFT grant) 0.17
Training kit for women in elective bodies (TFT
grant) 0.16
TA national dialogue on the constitutional roles of
civil society (TFT grant) 0.34
Total Pillar I 193.4 200.5 100.5 189.2 206.9 Pillar II FORECASTS ACTUAL
Lending Programme Integrated Wind Energy, Hydro Power and Rural
Electrification Programme (PIEHER) 320 299
Intergrated Wind Energy and PERG Programme
(CTF fund) 78
DWS Project in Marrakech Region (12th DWS) 135 125 Support to the National Irrigation Water
Conservation Programme II (PNEEI 2) 90 Under consideration – and for presentation to the
Board in 2015. Taza, Tangier or Kalladi Wind Farm Project
(private sector) 100 Refocusing on Tangier which was included in
PIEHER Ouarzazate Solar Power Station Project (Phase I) 150 140 Ouarzazate Solar Power Station Project (CTF)
CTF Fund 70
Ouarzazate Solar Power Station Project (Phase 2) 100 Under consideration for 2014
-24-
Project to repair protection facilities in 7 ports 90 Preparatory TA cancelled because not satisfactory. Refocusing in 2015 on Nador Port.
Logistics Strategy Support Project 100
Not implemented: The Moroccan Logistics
Development Agency (AMDL) created (prior to the project) in 2013 – Scheduled to be considered
in 2016 Non-Lending Programme
Impact assessment of the rural roads programme (MIC grant) 0.50 Not implemented: Assessment financed by the
EU
Technical assistance to MASEN (MIC grant) 0.50 Not implemented: Replaced by global TA of the
CTF (under consideration) Technical assistance to the National Logistics Observatory (MIC grant) 0.50 Not implemented: Observatory set up in AMDL,
created in 2013 Technical assistance to irrigation infrastructure
(MIC grant) 0.50
DWS Master Plan Study for urban and rural
communities north of the Moulouya river basin
(MIC grant) 0.50 0.20
Technical assistance for mitigation of the effects of climate change (MIC grant) 0.50 Study on green growth (not accepted by TFT),
submitted to the MIC fund (under consideration) Total Pillar II 606.5 191.0 290.5 712.0 0.2
Grand total 799.9 391.5 391.0 901.2 207.1
-25-
ANNEX 3: POTENTIAL LENDING PROGRAMME (2014-2016) AND SCENARIOS
2014
Project Amount Financial Sector Development Support Programme (PADESFI III) (Pillar
I) UA 90 million
Noor II Programme (Ouarzazate Solar Power Station II) (Pillar II) UA 80 million CTF: USD 119 million
Line of credit – SME Africa (Pillar I) UA 65 million (USD 100 million). Indicative Total UA 235 million
2015
Baseline Scenario Median Scenario High Scenario PAPNEI (Pillar II) UA 50
million PAPNEI (Pillar II) UA 50
million PAPNEI (Pillar II) UA 50
million Economic
Competitiveness Support
Project (PACE) (Pillar I)
UA 80
million Economic Competitiveness
Support Project (PACE)
(Pillar I)
UA 80
million Economic Competitiveness
Support Project (PACE)
(Pillar I)
UA 80
million
Nador West Med Project
(Pillar II) UA 90
million Nador West Med Project
(Pillar II) UA 90
million Nador West Med Project
(Pillar II) UA 90
million Support to the Green
Morocco Plan (Pillar I) UA 100
million Support to the Green
Morocco Plan (Pillar I) UA 100
million Support to the Green
Morocco Plan (Pillar I) UA 100
million 13th DWS (Pillar II) UA 80
million 13th DWS (Pillar II) UA 80
million Settat-Marrakech Railway
Line Doubling Project
(Pillar II)
UA 90
million
National Rural Roads
Programme (PNR III) (Pillar
II)
UA 50
million
Non-sovereign operation UA 50
million Non-sovereign operation UA 50
million TOTAL UA 320
million UA 450
million UA 600
million Budget support/Total 56% 40% 30%
2016
Baseline Scenario Median Scenario High Scenario PADESFI IV (Pillar I) UA 90
million PADESFI IV (Pillar I) UA 90
million PADESFI IV (Pillar I) UA 100
million Settat-Marrakech Railway
Line Doubling Project
(Pillar II)
UA 70
million Settat-Marrakech Railway
Line Doubling Project
(Pillar II)
UA 80
million Settat-Marrakech Railway
Line Doubling Project (Pillar
II)
UA 90
million
Support to Social Sector
Governance (Pillar I) UA 80
million Support to Social Sector
Governance (Pillar I) UA 80
million Support to Social Sector
Governance (Pillar I) UA 100
million 13th DWS (Pillar II) UA 80
million 13th DWS (Pillar II) UA 80
million 13th DWS (Pillar II) UA 80
million Support Project for Sector
Competitiveness and
Training-Employment
Matching (Pillar I)
UA 70
million Support Project for Sector
Competitiveness and
Training-Employment
Matching (Pillar I)
UA 90
million
National Rural Roads
Programme (PNR III) UA 50
million Non-sovereign operation UA 50
million Non-sovereign operation UA 80
million TOTAL UA 320
million UA 450
million UA 600
million Budget support/Total 53% 55% 48%
-26-
ANNEX 4: CSP RESULTS FRAMEWORK MONITORING MATRIX FOR 2014-2016
Country
Objectives
Constraints to the
Attainment of
Objectives FINAL RESULTS (end 2016) FINAL OUTCOMES (end 2016)
Before 2012 2012-2013 2014-2016
Closed
Loans Current Loans Technical
Assistance
Grants Loans Technical Assistance
Grants Loans Technical Assistance
Grants
PILLAR I: Governance
Boost economic
competitivenes
s
Coordination to
facilitate the identification of
constraints
Structural reforms initiated to eliminate
private sector constraints. Improvement of the Doing Business ranking (97-
2014)
Main constraints to private sector development identified (2 to 5 constraints)
PARGEF
Growth diagnosis
(ORNA/OSGE/ECON
)
State efficiency in budget management
and control of
macroeconomic balances
Institute a new organizational framework for the debt pole and the
tools needed to improve efficiency in
the management of government debt and cash flow
(i) Variation in interest charges due to variation in the Treasury debt stock: < 1 in
2016 (ii) Time limits for dissemination of the results of active cash-flow management
operations: 5 mn - 2016 (iii) Number of operational incidents reduced by 20%/year in 2016
Support
modernization of the debt management
organizational
framework (P-MOCOGEDE)
(OSGE)
Civil society involvement in
decision-making
processes
(i) 30% of elected women in
specialized commissions in 2015
(ii) 20% of women chair communes and regions
Development of training modules to build the
capacity of women
Training kit for
women in elective
bodies (MAFO)
CSOs enjoy the right to file motions and petition Parliament Organization of national forums
TA national dialogue
on the constitutional roles of civil society
(MAFO) Budget management
that is not results-based and insufficient
mobilization of
resources to create a budget margin for
sustaining growth
and boosting competitiveness
Lack of clarity in
relations between the public and private
sectors
Rules governing the
functioning of the
(i) Improved budget credibility: PEFA
PI-3 (composition of actual expenditure compared to the initial
budget) obtains an A score; (ii) Improvement of budget planning and
public spending policies: PEFA PI 12
obtains a score of 1; (iii) Improvement
of available budget information: PEFA
PI-6 (exhaustiveness of the information
in the budget documentation) obtains an A score; (iv) % of public contracts awarded
through competitive bidding >90% & average procurement duration <80
days; (v) % of private investments
relative to total investments in the economy increases by 5 points
(i) Effective implementation of the LOLF:
Budgeting for at least 12 ministries (multi-year and programme budgets) (ii) Preparation and publication of documents containing budget information to accompany
the Budget Act (gender report, wage bill
report)
(ii) Operationalization of the database that
centralizes the common business identifier
(iii) Establishment of the legal, regulatory and institutional framework for PPPs
Support to
competitiveness
(PACE) –
Economic and financial
governance
(OSGE)
Strengthening of the performance (i) Development of an IGF and IGM training Support to control organs
-27-
private sector are sometimes
constraining
assessment system (IGF) and public policies (Audit Bench): Scope, nature
and monitoring of external verification
improved (PEFA PI 26 moves to a score of B) Reform implementation for the
national public procurement system
plan to build the performance assessment capacity of public entities
(ii) Review of the Audit Bench information
system, interconnection with public finance management systems and adaptation to the
gradual dematerialization of the
administration
(PAOC) for the IGF and Audit Bench and to the
TGR on public contracts
(OSGE/ORPF)
(i) Improvement of the quality of
public services to citizens (e-
government; adoption of the public
services charter)
(i) Administrative services provided to citizens simplified and improved with
capacity-building for the public offices of
central government and public entities
(ii) Technical provisions taken for the
application of the Public Services Charter
Support to MFPMA
(OSGE)
Insufficient mobilization of
resources for
boosting competitiveness
Insufficient financing of VSEs and
entrepreneurs
Insufficient
sophistication of the
stock exchange sector
(i) Time-limit for the processing the applications for approval from OPCR
and FCPT management companies
declines by 67% (from 180 days in 2010 to 60 days in 2016); (ii) Average
deadline for processing of approval
applications for mutual funds, OPCRs and FPCTs reduces from 30 days in
2010 to 15 days in 2016
(i) 100% of business processes have reference
tables and XML plans
(ii) 80% of target businesses are integrated (iii) 100% of active CDVM employees are
trained
(iv) Tools for raising the awareness of external partners are disseminated
PADESFI
II (OFSD)
Project to enhance
the control of
financial markets (CDVM) (OFSD)
(i) System deployed and 100% of
business processes covered; (ii) Risk
management generalized to all CCG products and activities; (iii) 100% of
active employees trained
(i) Facilitate access to bank financing for
businesses and individuals (from 20,000 in
2010 to 30,000 beneficiaries by end-2016);
(ii) Average time limit for processing a guarantee application reduces from 2 weeks
in 2010 to one week in 2016
Guarantee System
Improvement
Project (CCG) (OFSD)
Casablanca Finance City (CFC) generates at least 1% of the GDP
growth rate in 2016
(i) MAGICODE software adapted to the context is available; (ii) 100% of legislative
instruments codified and translated
Support to the
preparation of the Monetary and
Financial Code
(OFSD)
(i) improved access to credits for students to finance their studies; (ii)
establishment of the Business Savings
Plan; (iii) improved community access to financial services country-wide;
promotion of women’s
entrepreneurship through the development of a guarantee product;
(iv) enhancement of banking sector
solidity and stability; (vi) creation of compartments in the Casablanca Stock
Exchange that focus specifically on
mutual funds and SMEs
(i) Bank penetration rate doubles from 30% in
2009 to 63% in 2016; (ii) Number of real
estate credits for the purchase of social housing that benefit from CCG guarantees
grow by 40% from 2010 to 2016; (iii) Over
half of microcredits awarded to women (55% of outstanding loans) in 2016 and 50% of
outstanding loans in rural areas in 2016; (iv)
600 students receive student loans since launching of the exercise; (v) Number of
ABB Mobile Banking adherents reach
155,000, including at least 50,000 in rural areas; (vi) volume of investments in the
investment capital reaches MAD 1550 billion.
Financial Sector
Development
Support Programme (3rd
phase) –
PADESFI III (OFSD)
At least one business is listed on both (i) Assessment of the opportunities for joint Simultaneous listing on
-28-
the Casablanca Stock Exchange and the West African stock exchange
(BRVM) (by 2017).
listing; (ii) identification of major constraints and design of scenarios
the Casablanca Stock Exchange and the West
African Regional Stock
Exchange (BRVM) (OFSD)
(i) Improvement of regulatory and control standards in line with
international standards; (ii) prudential
ratios; and (iii) financial situation
(i) Regulatory and control tools put in place (ii) Capacity-building for State employees
involved in regulation and control of
insurance and pensions
Reinforcement of the
regulatory and control
mechanism of the insurance and pensions
sector (OFSD)
Increase the number of women
shareholders in companies
Feasibility study, preparation of an action
plan and a project schedule for the creation
and commencement of the Fund
Study on the creation of a
Women´s Investment
Fund (OFSD)
Limited
territorialization of
State action in the agricultural sector;
Limited private sector involvement;
Poor development of
agricultural
products<
(i) Improved business environment in
the agricultural sector
(ii) Promotion of the value chain (iii) Development of agricultural
insurance
(i) Development of logistical and
agrobusiness platforms, and promotion of strategic subsector: 4 agropoles developed, of
which 2 are operational (Oriental and Saiss
regions); (ii) operationalization of the PPP; study conducted on delegated management of
irrigation areas; enabling instruments of the
law on the private agricultural board (PPP) and the law on aggregation published; (iii)
promotion of homegrown products (labellling
of 4 products) and promotion of organic
farming on 8,000 hectares; (iv) 5 agricultural
sub-sectors developed (1,000,000 hectares developed nationwide) and multi-risk
insurance applied
Green
Morocco Plan Support
Programme
2008-2020 (PAPMV)
(OSAN)
Establishment of a model for
promoting youth employment based on
entrepreneurship
Installation of 160 micro-enterprises of Young Agricultural Entrepreneurs (JEA))
Promotion of Young
Agricultural Entrepreneurs (JEA)
(OSAN)
Boost agricultural sector competitiveness and sustainability
through sustainable agricultural water
management
Signature and launching of the reform
programme (Budget support measures approved)
Support sector competitiveness
– Green
Morocco Plan (OSAN)
Green growth development tools
prepared
(i) Roadmap prepared for the promotion of
green growth in the Sous-Massa region; (ii)
mapping of "green professions" initiated for
the promotion of young green entrepreneurs
Promotion of green
growth (OSAN)
Boost
competitiveness and the
performance of
State social action
Low training-
employment
matching for the youth and for young
women in particular
(i) Increase of the socio-professional
integration rate for young higher education and vocational training
graduates; (ii) increased
professionalization of training courses
(i) Implementation of the mechanism to
combat youth unemployment: reduction of
the unemployment rate (8% in 2020, and 8.9% for women); (ii) development of
partnerships between businesses and
vocational training /higher education establishments
Training-Employment
Matching
Support Programme
(PAAFE)
(OSHD 2)
Employment promotion policies Diagnosis conducted on the impact of growth Study on the relation
-29-
integrated into the Government’s economic and social programme
patterns on employment
between inclusive growth and
employment in
Morocco (EES)
Institution of the private sector
development strategy The private sector covers 20% of educational
Nationwide institution of a computerized civil status registry;
Improved access to healthcare or
RAMED beneficiaries
50% of social programme beneficiaries are registered in the national population register
(NPR)
Household spending on health reduces by
National Population Register (NPR) –
Integrated National GIS of
grassroots medical
-30-
25% in 2020
coverage (OSHD)
Establishment of a national social protection strategy
50% of independents join a social protection system (MI+pension)
Social protection
diagnosis and intervention
framework (OSHD)
Establishment of a national pension
system and insurance sector reforms Reform scenario for the insurance and
pension system developed PADESFI IV
PILLAR II: Infrastructure
Boost
competitiveness
Poor diversification
of energy sources;
The country is highly
dependent on energy imports
(i) % of renewable energies in primary
energy consumption: 12% in 2020 (4.1% in 2011) (ii) % of renewable energies in total
electricity production: 42% in 2020 (27.2% in 2012)
Installation of 150 MW of solar power
Ouarzazate
Solar Power
Station 1 (ONEC)
(i) CSP power stations with parabolic trough
technology (200 MW) and solar tower technology (100 MW) constructed
(ii) Energy storage operational units
Ouarzazate
Solar Power Station II
(ONEC)
Need to consolidate transport
infrastructure
capacity to address the needs of the
business community
(i) Optimized management of
merchandise flows (cereals, petroleum
products); (ii) Emergence of structured and qualified operators
Development of 10 multi-flow logistics zones
Support for the
national logistics
development
strategy (OITC)
Study on the development
of transport multimodality and coordination and an
African logistics area
(OITC)
(i) Consolidation of Morocco´s port capacity in the western Mediterranean
(ii) Increased access and
competitiveness for the Oriental region
(i) Construction of a deep-water port
composed of a 4 200 ml dyke, one 1,500 m
container terminal; (ii) Development of a 1,500 ha industrial and logistics free trade
area
Nador port
project (OITC)
Increase of the operational capacity of the Fès, Casablanca and Marrakech
airports
(i) Development of the terminal facilities of
Fès and Marrakech; (ii) Construction and equipment of the second air control centre in
Agadir
3rd Airport
Project (OITC)
(i) Increased capacity for the Casablanca-Kenitra segment
(ii) Upgrading of the Settat-Marrakech
segment
(i) Construction of a 3rd 99 km track between Kenitra and Casablanca (for freight); (ii)
Renewal of the tracks (115 km), overhead
powerline system (250 km) between
Kenitra/Casablanca and Settat/Marrakech;
(iii) Construction of a second 38 km track
between Settat and Marrakech
Tanger-
Marrakech Railway
Capacity
Expansion Project (OITC)
(i) Increased fluidity in the circulation of trains between Casablanca and
Marrakech; (ii) Reduction (38 mn) of the travel time between Casablanca and
Marrakech; (iii) improvement of the
regularity rate of trains (currently 60%)
Construction of a 136 km railway track between Settat and Marrakech
Settat-
Marrakech Railway Track
Doubling
Project (OITC)
ONCF capacity-building on PPPs (i) Detailed training programme developed for ONCF staff on the preparation of energy
supply PPP contracts; (ii) standard
Support to ONCF for green energy supply (PPP
capacity) (OITC)
-31-
procurement documents adopted
Low value-added
(local processing)
oriented towards export
Relative scarcity of medium- and long-
term resources
available for the financing of SMEs
(i) Capacity of the phosphates production chain increases from 28 MT
to 47 MT per year; (ii) Operational and
ore transport costs reduced
USD 6 billion support to the OCP Ten-Year
Investment Programme (creation of 9,000
direct jobs and industrial SMEs)
Loan to the
Moroccan Phosphates
Authority
(i) Increased capacity, especially for
industries that have suffered from
electricity shortages; (ii) contribution to the creation and/or improvement of
facilities that give access to foreign
markets
Financing and creation of appropriate investment opportunities and management of
investments in the equity capital of
enterprises, infrastructure and projects relating to infrastructure.
Argan Fund for
Infrastructure
Development (regional fund
of EUR 66
million)
Support to the pan-African growth strategy of the AWB group
Granting of a multi-currency line of credit
(LOC) with a maximum value of EUR 72.5
million (7-year maturity period, including a 2-year grace period): at least 3 infrastructure
projects and 50 SMEs financed by 2022
(Morocco & Sub-Saharan Africa)
Line of credit to a bank
Support the inclusion of
regions in
economic and social
development
Problem of access to
a reliable energy
source for businesses
and households in the regions
Improve regular electricity supply and network reliability for clients
Electricity access rate of 100% in urban areas and 99% in rural areas;
Reduce the network´s technical loss rate by
approximately 1.5% (from 5% to 3.5%)
Electricity Transmission
and Distribution
Networks Development
Programme
PDRTE (ONEC)
69% thermal electricity, 27%
hydroelectricity and 4% wind power electricity by 2012
Installation of 850 MW of wind farms;
Installation of 520 MW hydro-electric hybrid
power stations
Integrated
Wind Energy, Hydro Power
and Rural
Electrification Project
Water resource
availability in quality
and quantity
Inefficient
management of irrigation networks in
the irrigation areas
and poor water development
(i) Reinforcement and safeguard of
water supply access in urban areas:
maintain drinking water access at 100%; (ii) increase the drinking water
access rate in rural areas from the
current 94.5% to 96% in 2016 (iii) Increase the output of distribution
networks from the current 73% to 76% in 2016;
(iii) Increase the output of power
generation networks from the current 95.3% to 96% in 2016;
(v) Improve the connection rate from
the current 94% to 96%: a) Improve connection rate to the
national sanitation network from the
(i) Extension of the Marrakech treatment
station: Additional flow of 1 m3/s and an emergency outlet of 1.4 m3/s on the Lalla
Takerkoust dam; (ii) construction of water
intake facility of 750L/s, treatment station of
420l/s, demineralization station of 420 l/s for
drinking water suppy to Khénifra town.
10th DWS
Project
(OWAS)
(i) Additional flow of 5m3/s from pumping of
raw water (approximately 3 million beneficiary inhabitants), laying of a 2,00 mm
diameter pipe over a distance of 5.5 km. (ii)
Laying of a new 2,000 mm diameter water supply pipe over a distance of 73 km,
rehabilitation of existing pipes with a
diameter of 1400 to 1500 mm over a distance of 2 km.
11th Rabat-Casablanca
DWSS Project
(OWAS)
-32-
current (2014) 73% to 75% in 2016; b) Increase the wastewater treatment
rate from 44% in 2016 to 60% in
2020, compared to the current 36%
(i) The flow rate of water pumped from the Al Massira dam is 7 m3/s in 2017 (for the 1st and
2nd phases); (ii) 3 pumping stations built by
2017 (Phase I); (iii) 2 reservoirs built by 2017 (Phase I).
12th
Marrakech DWS Project
(OWAS)
Reinforcement of DWS in rural or urban
areas (selected from the programme contract)
13th Drinking
Water Supply
Programme (OWAS)
Delegated management of a community network through a PPP arrangement
AWF/ONEE grant: Commercial Risk
Management Sub-
contracting Project
(OWAS) National sanitation plan available Strategic review of the
National Sewage and
Wastewater Treatment Programme (PNA)
(OWAS) (i) Promotion of irrigation water conservation and development; (ii)
Improved institutional capacity and
better adaptation to climate change
(i) 20,000 ha converted to localized irrigation; (ii) National irrigation map prepared;
(iii) Early warning system for functional
irrigation.
National
Programme for
Irrigation Water Conservation
Support Project
(PAPNEEI)
(OSAN)
(i) Development of strategic tools for the irrigation sector; (ii)
implementation of operational water
management tools and capacity-building.
(i) Better planning of water resources over
400,000 ha; (ii) Promotion of agricultural
water conservation on 30,000 ha.
Development of
irrigation infrastructure
(OSAN)
Modernisation of irrigation water infrastructure;
Irrigation water development;
Institutional capacity-building.
(i) Conversion of irrigation from traditional
methods (gravity and sprinkling) to localized irrigation on 25,000 hectares; (ii) Reduction
of water supply complaints by 30% in 2020;
(iii) Localized irrigation surface area: from 192,000 ha in 2014 to 218,000 ha in 2020;
(iv) Remote management, irrigation early
warning, water resource information and management systems are operational in 2020
PAPNEI II
(OSAN)
Support the execution of PAPNEI II Strengthen the performance of
Agricultural Water Users´ Associations (AUEA) and promote participatory
irrigation management
Improve programming, support the
procurement process, ensure capacity-
building for the ministry of agriculture and
ORMVAs.
(i) Organisation of capacity-building for the
AUEAs in the Loukos, Tadla and Doukala
irrigation areas; (ii) Diagnosis and proposal of institutional reforms to promote AUEAs.
Support the National
Irrigation Water Conservation Programme
2 and promotion of
AUEAs in the irrigation sector (OSAN)
Inadequate transport
infrastructure
capacity to address the needs of the
Increase in the population´s rate of access to rural roads: 90% in 2016
(54% in 2005)
Construction of 15,560 km of rural roads comprising 65% paved roads and 35% earth
roads
2nd National
Rural Roads
Programme (OITC)
-33-
business community
Construction and rehabilitation of 25,000 km
of rural roads
3rd National Rural Roads
Programme
(OITC)
Technical Assistance Discussed with the Authorities and Left in the Pipeline
FINAL RESULTS (end-2016) FINAL OUTCOMES (end-2016) Technical Assistance Pipeline
At least 1/4 of VSEs/SMEs that receive credits are located in rural areas
Control of risks and establishment of a GIS piloted by the Jaida Fund to increase AMC credits granted to VSE/SMEs. Capacity-building support to micro-credit associations (OFSD)
(i) 110,000 person undergo the financial education programme
(50% youth, 40% women and 30% from rural areas; (ii) 300 VSE/SMEs benefit from the financial education programme
(40% women in business and 30% from rural areas).
(i) Teaching aids, training and awareness-raising modules made available; (ii) Provision of
targeted training, especially for the youth, women and rural dwellers; (iii) Organization of
training for VSE/SMEs. Support the promotion of financial education (OFSD)
Promotion of PPPs and development of agricultural products Support operationalisation of the aggregation process and build the capacity of aggregation
stakeholders Promotion of value chains (OSAN)
Promotion of micro-credit and small farmers´ access to
financing Partnership agreement between CAM (Crédit Agricole du Maroc), AUEA and ORMVA
signed and implemented Technical support to Tamwil El Fallah (OSAN)
Promotion of PPPs in irrigation (Dar Khroufa - Loukos sector)
over 22,000 ha. Design and formulation of the operation Promotion of PPPs in irrigation (Dar Khroufa - Loukos sector) (OSAN).
Nationwide generalization of RAMED Master plan for monitoring RAMED (OSHD) Establishment of civic mechanisms in primary and secondary
health centres nationwide 45% of persons are satisfied Develop citizen access and participation mechanisms for the delivery of social
services (OSHD) Improved management of PSHs 7% of public services positions are filled by persons with disabilities Capacity-building in the management of persons with disabilities PPP preparation projects are designed based on the new legal,
regulatory and institutional framework PPP framework established; managerial capacity of these partners is consolidated: Technical
assistance for DEPP capacity-building in PPPs Support to DEPP (OSGE) – PPP support subject to KOAFEC financing (ORNA)
Strategic or decision-making tools formulated Review to the Macro unit, review of public spending and strategic reflection in
the area of energy (ORNA)
Better coordination instituted in both sub-sectors Main constraints to the development of both sub-sectors identified (agriculture and
automobile) Promotion of the value chain (ORNA) subject to a grant from KOAFEC
-34-
ANNEX 5: KEY SOCIAL INDICATORS
Year Morocco Africa
Develo-
ping
Countries
Develo-
ped
Countries
Basic Indicators
Area ( '000 Km²) 2011 447 30 323 98 458 35 811Total Population (millions) 2013 33,0 1 109,0 5 909,3 1 252,8Urban Population (% of Total) 2013 57,8 40,2 47,7 78,3Population Density (per Km²) 2013 72,3 46,9 70,7 23,5GNI per Capita (US $) 2012 2 960 1 719 3 815 38 412Labor Force Participation - Total (%) 2012-2013 34,9 37,4 67,9 72,1Labor Force Participation - Female (%) 2012-2013 27,2 42,5 38,6 44,6Gender -Related Dev elopment Index Value 2007-2011 0,625 0,502 0,694 0,911Human Dev elop. Index (Rank among 187 countries) 2012 130 ... ... ...Popul. Liv ing Below $ 1.25 a Day (% of Population)2007-2011 2,5 40,0 20,6 ...
Demographic Indicators
Population Grow th Rate - Total (%) 2013 1,5 2,5 1,3 0,3Population Grow th Rate - Urban (%) 2013 2,1 3,4 2,5 0,6Population < 15 y ears (%) 2013 27,9 40,9 28,3 16,4Population >= 65 y ears (%) 2013 5,0 3,5 6,1 16,8Dependency Ratio (%) 2013 48,7 77,9 52,4 49,9Sex Ratio (per 100 female) 2013 97,5 100,0 103,3 94,4Female Population 15-49 y ears (% of total population) 2013 27,9 24,0 53,1 45,2Life Ex pectancy at Birth - Total (y ears) 2013 70,9 59,2 68,4 77,8Life Ex pectancy at Birth - Female (y ears) 2013 72,7 60,3 70,3 81,2Crude Birth Rate (per 1,000) 2013 22,7 34,8 21,2 11,2Crude Death Rate (per 1,000) 2013 6,3 10,4 7,6 10,4Infant Mortality Rate (per 1,000) 2013 25,8 61,9 39,8 5,5Child Mortality Rate (per 1,000) 2013 31,4 97,4 56,3 6,6Total Fertility Rate (per w oman) 2013 2,7 4,6 2,6 1,7Maternal Mortality Rate (per 100,000) 2010 100,0 415,3 240,0 16,0Women Using Contraception (%) 2013 66,7 34,9 62,6 71,3
Health & Nutrition Indicators
Phy sicians (per 100,000 people) 2004-2011 62,0 47,1 117,8 297,8Nurses (per 100,000 people)* 2004-2011 89,0 132,6 202,7 842,7Births attended by Trained Health Personnel (%) 2006-2011 73,6 52,6 66,3 ...Access to Safe Water (% of Population) 2012 83,6 68,8 87,2 99,2Access to Health Serv ices (% of Population) 2000 70,0 65,2 80,0 100,0Access to Sanitation (% of Population) 2012 75,4 39,4 56,9 96,2Percent. of Adults (aged 15-49) Liv ing w ith HIV/AIDS 2012 0,1 3,9 1,2 ...Incidence of Tuberculosis (per 100,000) 2012 103,0 223,6 144,0 23,0Child Immunization Against Tuberculosis (%) 2012 99,0 83,0 81,5 96,1Child Immunization Against Measles (%) 2012 99,0 74,0 83,0 94,3Underw eight Children (% of children under 5 y ears) 2005-2012 3,1 19,7 17,0 1,4Daily Calorie Supply per Capita 2009 3 264 2 481 2 675 3 285Public Ex penditure on Health (as % of GDP) 2011-2012 2,1 2,9 3,0 7,5
Education Indicators
Gross Enrolment Ratio (%)
Primary School - Total 2012-2013 116,9 101,9 109,4 100,9 Primary School - Female 2012-2013 114,1 97,9 107,6 100,6 Secondary School - Total 2012 68,9 47,4 69,1 100,2 Secondary School - Female 2012 63,4 44,0 67,8 99,7Primary School Female Teaching Staff (% of Total) 2012-2013 54,0 46,6 58,0 84,3Adult literacy Rate - Total (%) 2011-2012 67,1 62,0 80,3 99,2Adult literacy Rate - Male (%) 2011-2012 76,1 70,7 85,9 99,3Adult literacy Rate - Female (%) 2011-2012 57,6 53,7 74,9 99,0Percentage of GDP Spent on Education 2009-2012 5,4 5,3 4,3 5,5
Environmental Indicators
Land Use (Arable Land as % of Total Land Area) 2011 17,8 7,6 10,7 10,8Annual Rate of Deforestation (%) 2000-2009 0,0 0,6 0,4 -0,2Forest (As % of Land Area) 2011 11,5 23,0 28,2 35,0Per Capita CO2 Emissions (metric tons) 2010 1,4 1,2 3,0 11,6
Sources: AfDB Statistics Department Databases; last update :
United Nations Population Division, World Population Prospects: The 2012 Revision;
World Bank: World Development Indicators; UNAIDS; UNSD; WHO, UNICEF, WRI, UNDP; Country Reports.
For any given interval, the value refers to the most recent year available during the period
Note : n.a. : Not Applicable ; … : Data Not Available.
COMPARATIVE SOCIO-ECONOMIC INDICATORS
Morocco
mai 2014
0102030405060708090
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Infant Mortality Rate( Per 1000 )
Morocco Africa
0
500
1000
1500
2000
2500
3000
3500
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
GNI Per Capita US $
Morocco Africa
0,0
0,5
1,0
1,5
2,0
2,5
3,0
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Population Growth Rate (%)
Morocco Africa
111213141516171
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Life Expectancy at Birth (years)
Morocco Africa
-35-
ANNEX 6 : KEY DATA ON ONGOING BANK GROUP PORTFOLIOO OPERATIONS AS AT 30 JUNE 2014
-36-
ANNEX 7: SCORING OF THE INDICATORS OF PUBLIC WINDOW ACTIVE PROJECTS IN 2014
Projects Scored According to the SAP Method
Loan Conditions Procurements Financial
Performance Activities and
achievements Impact on
Development
Performance Score
IA OD Tot.
PAPNEI 2.66 2 2 2 2.75 2.15 2.75 2.29
3rd Airport
Project 3 2 2.4 2.25 2 2.36 2
2.28
Tangier-
Marrakech
Railway
Capacity
Expansion
Project
3 3 2.8 2.5 3 2.79 3 2.83
Electricity
Distribution and
Transmission
Network
Development
Programme
2.33 2.5 2.8 2.5 2.25 2.57 2.25 2.50
10th
DWS 2.66 2.5 3 2.75 3 2.57 3 2.67
11th
Rabat-
Casablanca
DWSS Project 2.33 3 2.75 2.75 3 2.5 3 2.61
Total Score 2.66 2.5 2.62 2.62 2.66 2.49 2.66 2.53
Measures in the form of reforms initiated and formalized through statutory and
enabling instruments and which are programmed in the provisional effectiveness
schedule of Budget Act No. 130-13:
Budget programming and multi-year programming with their respective presentations to
the Finance Commissions and the Parliamentary Sector Commissions from 1 January
2018; Abolition of SEGMAs and CAS, which no longer comply with creation conditions from 1
January 2018; Limitation of staff credits on 1 January 2016; Inclusion of State social insurance and pension contributions in the staff expenditure
chapter from 1 January 2019;
Presentation to Parliament of projects or actions broken down into budget lines (resulting
from central and regional programmes) within the budget review law related to the Budget
Act from 1 January 2017;
Ceiling on carryovers of investment appropriations from 1 January 2017; Programming nomenclature of State budget spending from 1 January 2017.
Measures to be pursued
Global MTEF pending the acquisition of technical assistance support;
Promulgation of the new Budget Act No. 130-13;
Restructuring of Budget Department, including a Budget Reform Support Unit, etc; Finalization of the IGF reform bill: Update of 1960 texts, etc.;
Mo
dera
te
Measures implemented Sector MTEFs prepared for 19 ministries.
Mechanism established and operational
Involvement of the Audit Bench in the assessment of public policies and attendant
recommendations
Au
dit
s a
nd
Rep
orts
Exhaustiveness
Transparency
Efficiency
Timely presentation
Limited scope of
parliamentary
review No general and
cost accounting
until promulgation of
the new Budget
Act No. 130-13; Limited accounts
certification of
the Audit Bench until
promulgation of
the new Budget Act No. 130-13
Tardy and
unsystematic monitoring of
IGF
recommenda-tions
Risk on project
audits by IGF; Weaknesses in
the configuration
of GID pending promulgation of
the new Budget
Act No. 130-13.
Mo
dera
te
Measures in the form of reforms initiated and formalized through statutory and
enabling instruments and which are programmed in the provisional effectiveness
schedule of Budget Act No. 130-13
General accounting from 1 January 2016; Cost accounting from 1 January 2019;
Certification of the regularity and accuracy of State accounts by the Audit Bench;
Annual performance report, performance audit reports, general State account and documents attached to the budget review bill relating to the finance bill, to be submitted
from 1 January 2019 in an effort to increase the amount of information transmitted to
Parliament;
Other measures provided for in the new Budget Act No. 130-13
Readjustment of the conditions and schedules for review and voting of Budget Acts; Increase of the scope of parliamentary authorization by informing parliament of certain
measures beforehand in the course of the fiscal year;
Clarification, definition and broadening of parliamentary amendment rights.
Measures initiated and launched
Extension of the GID system; will be extended to local councils and EEPs.
Measures to be pursued
Capacity-building for IGMs to, inter alia, monitor IGF recommendations at the level of their ministry;
GID: Configuration of general and cost accounting, programming classification and new
nomenclature for supporting documents; GID: Integration of GIR.
Measures implemented
Module for online monitoring of IGF recommendations;
Reduction of the time limit for submission of the Audit Bench report to Parliament.
Mechanism established and operational
Involvement of the Audit Bench in the assessment of public policies and attendant recommendations;
Establishment of a new PFM control commission in Parliament;
Assessment by the TGR and IGF of the management capacity of authorizing services in modulated control.
Mo
dera
te
-47-
Procu
rem
en
t
PEFA 2009 (PI 19),
NCBS 2011,
OECD/ CAD
2008, IGF, TGR
discussions
Legal and
regulatory
frameworks
Exhaustiveness
and transpa-
rency
Efficiency
Multiplicity of
the regulatory
frameworks of
public
enterprises
Lack of
independence and
efficiency in the
current
complaints
management
system M
od
erate
i. Measures implemented
Promulgation on 1 July 2011 of the new constitution which explicitly mentions the need to
combat corruption, right of access to public information and promotion of good
governance, transparency and integrity in procurements New Decree No. 2-12-349 of 30 March 2013, relating to public procurement, becomes
effective on 1 January 2014. It introduces major innovations such as the partial unification
of the regulatory framework, simplification and clarification of procedures, introduction of
e-procurement and improvement of complaint and redress mechanisms.
ii. Measures to be pursued
Adoption and effectiveness of the new decree to set up the National Public Procurement
Board (CNCP). The CNCP will be responsible for complaints and management of
remedies following a mechanism that is consistent with international standards.
Promulgation of the new organic Law No. 130-13 relating to the Budget Act (FL); Finalization of public procurement reform through drafting and adoption of the enabling
instruments of the new decree (CPS, CCAG);
Provisions on fraud and corruption to be inserted into the BDs.
Lo
w
Co
rru
pti
on
Exhaus-
tiveness
Low corruption
perception index
Mo
dera
te
Measures to be pursued
Revision of the corruption control legal framework (new law)
Draft convention between INPLC and IGF pending; INPLC capacity-building on the investigation of fraud and corruption;
Measures implemented
IGF capacity-building on the investigation of fraud and corruption within the framework
of twinning with the IGFs of Portugal and France.
Mo
dera
te
Global fiduciary risk
Moderate
Moderate
-48-
ANNEX 15: IMPORTANCE OF THE ROLE OF THE COUNTRY OFFICE (MAFO) AT EACH STAGE OF
THE OPERATIONS CYCLE OF ITS PORTFOLIO IN MOROCCO
Identification and Formulation of Operations: Firstly, constant dialogue with Morocco´s
partners ensures effective control of programming, which translates into a robust pipeline of
operations. Special attention is paid to quality-at-entry and preparation of operations through this
dialogue with stakeholders (including MEF) on the relevance of proposed interventions, and the
capacity of beneficiary institutions, through guidelines developed on the basis of economic and
sector work (including Morocco´s growth diagnosis in 2014), and through the contributions of 18
technical assistance operations, three-quarters of which are identified by the Office. These efforts
lead to a global reduction in timeframes for effectiveness of operations as well as better
preparation of operations launching, among others. Furthermore, the office continues its
involvement in coordination with other donors in Morocco, including becoming the lead agency
for the group on civil society.
Operations Supervision: Close monitoring operations implementation is mainly conducted by
MAFO (74% of supervisions), including grants which have attained significant financial
performance (51% of the disbursement rate in July 2014). Furthermore, MAFO is keen to
maintain a sound portfolio as demonstrated in the major restructuring of operations made end-
2013 (cancellation of UA 141 million). This freed up financing margins for a new lending
operation that is ready for launching.
Procurements and Fiduciary Monitoring: Similarly, the Office stepped up its support to
executing agencies on fiduciary issues by organizing the first fiduciary clinics in 2014 and
continuing its efforts on targeted coaching and specific workshops (grants). Furthermore, the
dialogue between MAFO and Moroccan partners has intensified since 2013 with respect to
preparation and guidance on implementation of the Letter of Agreement on the use of national
procurement procedures. MAFO also responded to the appeal of its Moroccan partners for
reflection and support on issues such as consideration to have a higher proportion of local
production in operations financed by the country´s donors.
Completion of Operations: With respect to quality-at-completion of operations, efforts have to
be pursued with the executing agencies to strengthen monitoring/evaluation and MAFO is
sensitizing partners in this regard.
-49-
ANNEX 16: ENDNOTES
1 New guidelines (ADB/BD/IF/2013/83 of 22/04/2013) for the review of country portfolio performance provides that the RPPP should be an
integral part of the CSP at three levels: during preparation, mid-term review and the CSP completion report. 2 The results, estimates and forecasts presented in this chapter come from the MEF macroeconomic unit and are supplemented with the Bank´s
own results, estimates and forecasts. 3 This poor performance is mainly observed in sectors such as phosphates, real estate, public works, textiles and hides and skins, which are
seriously affected by the decline in European demand. 4 Tax revenue was approximately 21.3% of GDP in 2012 and attained 19.8% of GDP in 2013. 5 The diesel subsidy retained will gradually decline from MAD 2.15 in the 1st quarter of 2014 to MAD 0.8 in the last quarter of 2014 6 In May 2014, Standard & Poor’s also mentioned the possibility that Morocco´s rating could move from "negative" to "stable" and confirmed
the “BBB-/A_3” rating given to the country for its long and short-term debts in local currency and foreign exchange. 7 The decline in imports affected all products except capital goods and semi-finished products. The decline in exports mainly affected
phosphates and its by-products (-23.3%) as well as the textiles and leatherwork sector (-3.9%). 8 Following a decline of 16.7% at end-2012 and 10.7% at end-2011. 9 The provisioning rate remains satisfactory (63%) as well as the capitalization of banks, since the average solvency ratio exceeds 12%. 10 This progression essentially stems from improvement of the facility and the rapidity of business creation procedures (5 procedures and 11
days). 11 Nevertheless, the improvements are obvious. The share of products with an average technological content rose from 31% in 2010 to 50% in
2013 due to the development of new trades in Morocco. 12 See the Growth Diagnosis conducted by the AfDB, authorities and MCC.
13 See the Growth Diagnosis conducted by the AfDB, authorities and MCC.
14 This rate rose to 58% among rural women. 15 Framework law on the environment adopted in 2013; a National Sustainable Development Strategy is in the finalisation stage and is
scheduled for September 2014. 16 Government, Parliament, Audit Bench, civil society. 17 The fiduciary clinic organized in March 2014 was an efficient communication framework to satisfy training needs and resolve management and control
problems. 18 UA 799.85 million in 2012, UA 391.5 million in 2013. 19 This affects all regions, age groups and social classes. 20 Economy and Finance, Agriculture, Water, Environment and Energy. 21 Preparation of a national irrigation map, establishment of a PNEEI monitoring system, preparation of a roadmap for institutional reform of the
irrigation sector, integrated and sustainable management (groundwater contract, artificial groundwater replenishment, use of treated
wastewater for irrigation). 22 Law on aggregation, law on organic farming, promotion of labels and local products, private agricultural board, action plan for the promotion
of agropoles, promotion of agricultural insurance, ...),
23 . Strategic tools (Irrigation Water Conservation Roadmap, National Irrigation Map, …); operational tools (PNEEI monitoring/evaluation
system, …); innovative tools (coupling of water conservation with energy conservation, installation of smart terminals, ...) 24 African Capitalization Fund owned 25% by the Bank and established within Banque Populaire Centrale. Objectives of the investment: Help
develop financing for SMEs; contribute to the increase in the bank penetration rate; support the Bank in its external growth in Africa 25 To date, 29% of active AfDB operations (projects and sector budget support) use the public expenditure circuit through the stages of
commitment, settlement, authorization and payment. The operationalization of modulated control of State expenditure and the scheduled
implementation of the new Organic Law on the Budget Act and Accounting reform in 2017, will enable the AfDB to increase this rate. 26 33 operations including 13 sovereign loans, 2 non-sovereign loans, 11 MIC grants and 7 TFT grants, 27 Despite the unsatisfactory score of the 12th DWS of Marrakech that fell into the risky category of potentially problematic project (PPP) 28 ONEE Water Branch, Department of Irrigation in the Ministry of Agriculture and MASEN 29 Tangier Wind Farm 2 under PIEHER 30 Nevertheless, the conditions precedent to first disbursement for the other components should be fulfilled by July and November 2014. 31 IGF indicated during consultations that, for structural reasons, it would like to initiate dialogue with the Bank to submit the provisional
reports in June and the final reports in September. 32 In the case of the PDRTE, the schedule of works as planned at project appraisal will not be respected. Consequently, the initial loan closure
date of 31/12/2014 will be extended (two to three years). 33 5 out of 8 sessions organized 34 The poor performance of the Airport Project stems from the exceptional situation generated by the institutional crisis of the executing agency
which slowed down implementation of the operation. Consequently, MAFO restructured the project in 2013 and cancelled EUR 70 million. 35 It should also be noted that the project, by its very nature, has a limited number of procurements with large-scale lots whose time limits for
preparation of BDs and bid analysis are generally fairly long. Consequently, first disbursement can only be done after the first year. 36 For operations needing it. 37 UA 40 million and USD 13.6 million 38 The audit reports for FY2012 were all submitted. For FY2013, since the deadline for submission of audit reports to the Bank was 30 June
2014, no report had been received during the drafting of this Review. However, it should be noted that in previous fiscal years, these audit
reports were generally transmitted before October. It is expected that the reports for FY2013 will be received before October 2014 as has been the practice in previous years.
39 (Government, private sector, civil society, development partners) 40 Net school enrolment ratio for children aged 12 to 14 years does not exceed 53.9% at the national level. 41 Since the scope and pillars of Bank operations will not be modified after this CSP Mid-Term Review, the final report could be approved by
the Country Team pursuant to the provisions of point 2.4.6(b) of Presidential Directive No. 03/2013.
