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Morocco receives a loan of 138 million euros from the African Development Bank

The Alawi country closes the signing of two million-euro loan agreements with the African Development Bank (AfDB) to accelerate economic growth and improve its population's access to drinking water supply
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AFP/FADEL SENNA  -   Production line in a factory of the Moroccan agro-industrial company Lesieur Cristal in Meknes

At a meeting in the Moroccan capital of Rabat, the Alawi Minister of Economy and Finance, Nadia Fettah, the director general of the National Office of Electricity and  Water (ONEE), Abderrahim El Hafidi, and the representative in Morocco of the African Development Bank (AfDB), Achraf Hassan Tarsim, have agreed on two loans to the Kingdom amounting to 138 million euros. 

These two loan agreements - one for 120 million euros and the second for 18 million euros - are aimed at financing two different areas, according to an AfDB press release. On the one hand, the EUR 120 million loan agreement aims to boost support programmes for financial inclusion and Moroccan entrepreneurs and small and medium-sized enterprises (SMEs). While, for its part, the €18 million agreement involves additional financing to the Project for the Sustainability and Security of Access to Water which, signed in 2018, mobilised nearly €115 million. 

"These two operations targeting two different sectors share the same slogans: inclusion and recovery," maintained AfDB representative Achraf Hassan Tarsim. 

"I would like to underline the important role of the African Development Bank as a reference partner in supporting the reforms undertaken by the Kingdom of Morocco in several priority sectors, in particular the financial sector, transport, energy, drinking water, education and health," said Nadia Fettah in an official communiqué. Furthermore, the Minister of Economy encouraged the African Development Bank to continue to collaborate and finance the Moroccan government's efforts to implement new strategic projects, economic recovery and the promotion of the New Development Model. 

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PHOTO/ARCHIVO - Nadia Fettah Alaoui, Minister of Economy and Finance of Morocco

The African Development Bank has been working with the Alawi government for more than 50 years, and to date, its contribution of almost EUR 10 billion has helped boost areas such as transport, human development, energy, water and the financial sector. 

 Financial Inclusion Support Programme 

According to a study conducted last November in the Kingdom of Morocco, small and medium-sized enterprises were the hardest hit by the effects of COVID-19, significantly reducing their turnover. To address this situation, the Alawi government has launched a number of projects and programmes aimed at supporting small entrepreneurs and guaranteeing their business activity. 

One of these projects is the Financial Inclusion Support Programme, which, by receiving part of the 120 million euros, aims to support businesses affected by the pandemic, so that they can keep their jobs and continue their normal work activities. The project also aims to facilitate access to finance for households and businesses, support entrepreneurship, and diversify sources of finance to strengthen inclusiveness in the capital market. 

 Water Access Sustainability and Security Project

The second of the loan agreements agreed with the African Development Bank is, in fact, additional financing to the nearly €115 million that the entity provided in 2018. The objective of this loan is to ensure the supply and security of drinking water, and is linked to the National Drinking Water Supply and Irrigation Programme 2020-2027 (PNAEPI), signed in January 2020. 

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PHOTO/REUTERS - Production line at a mask factory in Morocco

This injection of funds comes at the same time as reports of "serious challenges" related to water supply are widespread. According to publications issued by the Moroccan government and independent think tanks, water scarcity is one of the most important problems facing the Kingdom, and it must redouble its efforts to address the issue, as well as sustainable agriculture. 

Thus, within the framework of the PNAEPI programme, Morocco aims to ensure access to drinking water in the provinces of Guercif, Zagora, Al Hoceima, Tangier and Beni Mellal. To this end, the Maghreb country plans to channel water from the "Ghriss" and "Ibn Battouta" dams to the treatment plants in Al Hoceima and Mharhar/Tangier, respectively.  This was stated in the joint communiqué, which also expressed interest in strengthening water production in the regions of Guercif and Zagora. 

"The partnership with the African Development Bank is historic and exemplary with a high level of commitment. This additional funding will strengthen drinking water access systems in several regions of the Kingdom," concluded the director general of the National Office of Electricity and Drinking Water, Abderrahim El Hafidi.