THE
NORTH AFRICA JOURNAL
155th. Issue
Released August 23, 2004
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In a prudent move, the Algerian government is planning to base its economic plan for the 2004-2008 period on a $19 per barrel of crude oil. Although there is a strong likelihood for the oil prices to remain above that level, this prudent budgetary planning policy aims at absorbing possible fluctuations in oil prices and minimizing their impact on economic growth.
Stock Exchange
New Wave of Introductions Into the Casablanca Stock Exchange Starts in 2005
In the past four years, the Casablanca Stock Exchange witnessed only three floatations from IB Maroc, Unimer and the BCP Bank. Lack of introductions worried the market but there are signs that the trend is likely to reverse in the next three years with high profile introductions in the pipeline.The bourse had 52 listed companies in 2003, but starting next year, it will have new shares to trade. This year already, the BCP's introduction into the bourse reminded investors of the era of the privatization of state owned companies through initial public offerings. The BCP share sale was oversubscribed, opening investors' appetite for more and paving the way for more successful entries.
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Auto Market
Strong Momentum in the Maghreb Auto Market But Growing Competition for Leadership
Single-digit year-on-year growth in the Moroccan auto market and strong momentum in neighboring Algeria are creating opportunities for carmakers. But as in other regions around the world, those markets are becoming highly competitive and not all vendors are taking advantage of a boom in demand. In Morocco, the Japanese Toyota has been able to surpass the performance of the usually well-entrenched French automakers. In oil-rich Algeria, the market has been expanding at double-digit rates and 2004 is likely to be a record-breaking year. In that market, French automakers and their local dealers have been able to improve their performance drastically, while the South Koreans, which used to be the most aggressive and at the top of the rank are nowhere to be found today.
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Economic Activity
Morocco's Latest Agriculture and Industrial Activity Indicators
In the first half of 2004, the total harvested area for the cereal crop in Morocco reached 3.8 million hectares, or 70% of the total planted surface. The amount of cereal distributed to the domestic market as of June 2004 was 6% up from the same period last year to 890,000 tons. Soft wheat accounted for 99% of that volume. Individual dealers acquired 64% of the distributed volume, 26% for cooperatives and 10% for the millers. Meanwhile, Morocco's cereal imports declined sharply by 32% in the same period to just about 130,000 tons, constituted with 85.3% corn and 14.7% hard wheat.
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Populations and the Economy
Despite a Shrinking Community, Tunisian Expatriates' Contribution to the Economy on the Rise
There are 843,204 Tunisian nationals residing abroad, and 83% of them live in Europe. The others are in the Middle East North Africa region (MENA) with 14%, while some 3% are scattered around the globe. With 493,000 Tunisians, France is home of the biggest share of the Tunisian expatriate community, followed by Italy with 101,000, and Germany with 54,000. 53,000 Tunisians live in the rest of the Europe..
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Agriculture
Cereal Campaign on Track in Algeria but June Rains and Yellow Rust to Impact on up to 10% of Production
The 2004 harvesting campaign is currently in its final stage in cereal planting regions in Algeria. It is generally on schedule, despite some delays due to the unexpected rain falls in the month June. Perturbations in the schedule and some 10% production loss did not deter farmers to do their best and incentives have been extended to make the season as successful as possible. So far, 2.5 million hectares of land, the equivalent of 6,177,750 acres have already been harvested. Only a half million hectares remain to be harvested this season.
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Real Estate
Skyrocketing Land Prices in Casablanca
Land prices in Morocco's financial capital Casablanca have reached record high, and there are signs that other cities are following the same steps. The situation has also led the amount of credit released by banks for land purchases and real estate development to top to MAD 43 billion so far this year, against MAD 40 billion in the whole 2003, in a trend also partly driven by declining interest rates. In Casablanca, this upward pricing trend has been difficult to justify and within the same zone, prices for comparable deals fluctuate greatly. For example in the "2 Mars" neighborhood in downtown Casablanca, the square meter is sold between MAD 10,000 and MAD 12,000. In the nearby Gauthier neighborhood, the same square meter goes for more than double that range...
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Food Sector
Tension Over the Price of Flour in Algeria
The price of bread in Algeria has been a major topic of feuding between the government and the nation's bakers. Their association, the Fédération Nationale des Boulangers (FNB) has been threatening to call for a nationwide strike, and prime minister Ahmed Ouyahia was forced to state his position this week to reduce tension.
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Population
The Long-Term Aging of the Moroccan Population
The size of the Moroccan population is estimated at 30 million people, and growing at a rate of 1.5% annually. Census experts and demographers say the profile of the population is undergoing a transition period characterized by a break in the traditional demographic regime, typified by high birth and mortality rates. In the area of mortality, infant mortality was reduced by two thirds since the 1950s, while mother's mortality rate halved during that same period. These two factors have partly led to increased life expectancy.
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Business/Corporate
Groupe Chaabi of Morocco Seeks to Expand in Sub-Sahara Africa
The Moroccan private corporation Groupe Chaabi continues to expand in the African market and has been able to find opportunities in economies that have shown positive growth prospects. The company is already well entranched in the most advanced economies of the continent, including Tunisia, Egypt, Cote d'Ivoire and of course its home market Morocco
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Trade
Bush Endorses US-Morocco FTA, Moroccan Parliament to Ratify it in Fall
President Bush signed on Tuesday the U.S.-Morocco Free Trade Agreement Implementation Act. The signing occurred three weeks after U.S. lawmakers endorsed the agreement. In Morocco, the pact has not even been debated yet in the parliament, which is scheduled to review it in its upcoming October session. President Bush signing event was low key, without the usual ceremony.
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Social and Economic Developement
Massive Spending up to 2008 to Stimulate the Algerian Economy and Improve Living Conditions
In a prudent move, the Algerian government is planning to base its economic plan for the 2004-2008 period on a $19 per barrel of crude oil. Although there is a strong likelihood for the oil prices to remain above that level, this prudent budgetary planning policy aims at absorbing possible fluctuations in oil prices and minimizing their impact on economic growth.
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Law
Algeria Legalizes Electronic Signature and Issues New Measures in Banking
The Algerian government made this week a new amendment to the civil code, with the recognition of electronic signature. From now on, electronic messages via private networks and the Internet are considered valid legal documents, with the only condition that the sources are clearly or easily identified. This amendment comes as a response to growing eCommerce and trading via the Internet, which create a new legal environment requiring changes in the Algerian law.
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