Morocco's banks get good ratings from Fitch's

Four of Morocco's leading financial institutions received good marks in August evaluations published by Fitch ratings agency. Two of the largest banks, both of which have the support of their French mother banks, namely the Société Générale du Maroc (SGMA) and the BMCI (BNP-Paribas group) were rated AAA/stable perspectives for the long term, while AttijariWafa Bank (AWB) was rated AA-/stable perspectives. The SGMA's credit subsidiary Eqdom was rated AA/stable perspectives.

AttijariWafa Bank is a major player in the Moroccan banking sector with 28% market share. With no outside shareholder, AWB's rating of AA- reflects a more exposed position than those of SGMA and BMCI. AWB is active across Francophone Africa: 6% of its loans are in Tunisia, a country passing through a period of instability, to say the least, while another 12% of loans are in Sub-Saharan Africa. Fitch's considers that an increased volume of loans in the latter region constitutes a risk.

Although the AWB performs well in the Moroccan market, increased competition and a rise in interest rates could affect performance. Any lowering of Morocco's sovereign rating, currently at BBB-/stable, or a reduction in liquidities could lead to a downgrading of AWB's rating. Given the bank's short-term finance needs, its available liquidities (MAD19.6 billion / US$2.3 billion) are moderate.

For more news and expert analysis about Morocco, please see Morocco Politics & Security.

© 2013 Menas Associates

Libya: Political Exclusion Law Committee finally gets going

 

The 77-member Committee of Applying the Standards of Taking Up Public Posts, the body tasked with implementing the political exclusion law, has begun its work in earnest. This week, the committee, comprising mainly those who were part of the old Integrity Committee, summoned 11 members of the Congress to inform them that the Political Exclusion Law applies to them.

Four of these 11 have already attended committee sessions and all demanded that they be given one week to prove that the law is not applicable to them. It appears that the committee granted them their request and that they will all have the chance to defend themselves. The remaining seven from this first batch are due to attend hearings with the committee this coming week.

 

This first group is clearly just the tip of the iceberg and represents the first set of cases that the committee had been able to work its way through. According to the committee, out of 200 Congress members, so far only 98 of them have actually completed and handed in the compulsory forms distributed by the committee that oblige members to provide details of their past. Implementation of the law is clearly going to be a long, drawn-out process.

 

For more news and expert analysis about Libya, please see Libya Focus and Libya Politics & Security.

© 2013 Menas Associates

Algeria: No change in top public jobs

The usual round of personnel changes among senior judges, walis (provincial governors), and ambassadors did not take place this summer. There is, of course, a regular rotation within the ranks of senior officialdom, but when these changes happen during a parliamentary recess, they are often politically motivated.

 

The health of President Abdelaziz Bouteflika, who signs the decrees, is certainly a factor, but observers also argue that the regime is unwilling to go ahead with any shuffle because it fears that a new administration could escape its control during this highly volatile period.

 

Additionally, political analysts believe that influential – and older – figures within the regime are blocking a proposed policy of forced retirement from public administration at the age of 60. With a huge demographic youth bulge failing to push its way into the system and many institutions dominated by much older officials, this idea is superficially attractive.

 

It is nevertheless unlikely that any radical reforms along these lines will be implemented soon. The 65-year-old rime minister, Abdelmalek Sellal , is said to have ordered the drafting of several alternative recommendations to avoid further paralysis at state institutions due to age.

 

For more news and expert analysis about Algeria, please see Algeria Focus and Algeria Politics & Security.

 

© 2013 Menas Associates

 

Algeria: UN Mediator for the Sahara on New Tour in North Africa

The UN mediator for the Sahara, Christopher Ross, undertook a two week tour of North Africa (March 20 – April 3) in another attempt to persuade the parties to the Western Sahara conflict to sit at the table of direct negotiations.

 

After visiting a month or more ago the capitals of the Group of Friends of Western Sahara (Washington, Moscow, Paris, Madrid, London), as well as Germany and Switzerland, to seek international support for his approach, Ross resumed contacts over the last two weeks with the parties directly involved in the conflict: Morocco, Algeria, Mauritania and the Polisario Front.

 

UN deputy spokesman, Eduardo del Buey, told reporters in New York that the purpose of this new North African tour was to prepare the ground for a “possible resumption of direct talks” on the Sahara conflict, as a settlement of this issue “becomes more urgent than ever” in view of the “growing risk of instability in the Sahel.” He said that Ross's trip was“to prepare for the next phase in the negotiating process and a possible resumption of direct talks to achieve a mutually acceptable political solution.”

 

For more news and expert analysis about Algeria, please see Algeria Focus and Algeria Politics & Security.

 

© 2013 Menas Associates

Libya in a different position from other North African countries

The problems of the North African regimes and the related conflicts have given rise to the creation of profound instability. Algeria, Tunisia and Egypt are all in crisis, with indigenous unrest and opposition to their regimes. When Sudan's imminent break up is taken into account, together with the continuing Western Sahara conflict for Morocco, the entire region must seem unfavourable for foreign investment and development.

Libya is, however, in a different position. Security is being maintained at a high level inside the country and the regime's overseas opponents are political and financially very weak.

The current signs are that the regime will survive the crisis given the strength of both its security services and finances. It is able to be flexible in dealing with the individual difficulties arising from the price of foodstuffs, which can easily be subsidised, while the people's poverty can be alleviated by increased allocations from the Wealth Distribution Programme. At the same time, any shortage of funds for development can easily be cured by releasing finance from the State treasury.

There has been no hint of any Libyan antagonism against foreigners and especially those who are not directly competing for work with the local workforce. Doubtless, security will be tightened until the struggle for power in Egypt is resolved. The movement of foreigners will also be monitored by the police, and roadblocks will become part of the standard pattern of traffic control.

International movements will also tend to be subject to greater scrutiny than usual. Overall, Libya could survive the present shocks without great damage but the unpredictable cannot be discounted.

For more news and expert analysis about Libya, please see Libya Focus and Libya Politics & Security.


© 2010 Menas Associates

Algeria to start looking for unconventional methods to diversify energy sources

According to Algeria's Oil Minister Youcef Yousfi the country will start looking for unconventional gas deposits and study the use of nuclear power in an effort to diversify its energy sources.

“We are going to intensify exploration in the near future, especially in regions that haven't been explored much. We are going to do an inventory of unconventional hydrocarbons. The same way that you in Canada are looking for shale gas, we are going to look for oil and gas in shale and compact formations,” said Yousfi at World Energy Congress in Montreal.

Algeria produces around 1.4 million b/d of oil per year, and exports around 60 billion m³ of natural gas to Europe a year. It relies on oil and gas for the majority of its foreign currency revenue, and is the largest supplier of gas after Russia and Norway.

“We want to ensure a safe and durable supply of hydrocarbons and petrochemical products to our traditional partners in Europe, Asia and North America,” said Yousfi.

Yousfi also said Algeria wants to speed up the introduction of renewable energy, and the government will begin studies on nuclear power with a view to adopting it within about 10 years.

Source: Bloomberg

For more news and expert analysis about Algeria please see Algeria Focus and Algeria Politics & Security.

Libya set to account for 7.74 per cent of African oil demand by 2014

The latest Libya Oil & Gas Report, compiled by BMI, forecasts that the country will account for 7.74 per cent of African oil demand by 2014, and will be responsible for 15.82 per cent of overall supply. It is expected that African regional oil use will average at 3.67mn b/d in 2010 and then rise to around 4.14mn b/d by 2014.

Regional oil production, in 2009, averaged at an estimated 9.69mn b/d. It is set to rise to 11.79mn b/d by 2014. Oil exports show gradual growth, because demand growth is stalling the pace of supply expansion. In 2001, this region was exporting an average 4.86mn b/d. This total rose to an estimated 6.19mn b/d in 2009, and is expected to reach 7.66mn b/d by 2014.

Libya's demand for natural gas is expected to reach 175.9bcm by 2014, production of approximately 391.9bcm, which suggests a rise of net exports from 120bcm in 2009 to 216bcm by the end of the period. In 2009, Libya consumed an estimated 5.44 per cent of the region's gas, its market share forecast for 2014 is estimated at 4.49 per cent. It contributed 7.42 per cent to regional gas production, in 2009, and by is expected to account fore for 8.93 per cent of supply by 2014.

Libya is currently fourth place of BMI's composite Business Environment (BE) ratings table, which combines upstream and downstream scores. It continues to occupy first place, above Gabon, with a comfortable margin over its nearest rival of three points. The country's score m benefits from its proven oil reserves and a region-topping oil reserves-to-production ratio (RPR).

Source: Companies and Markets

For more news and expert analysis about Libya, please see Libya Focus and Libya Politcs & Security.