The first meeting of Med Alliance Borad took place in Tunis. The network in charge of the Invest In Med project realization, is led by ANIMA Investment Network with other members such as ASCAME, UMCE-BUSINESSMED. This first meeting was the opportunity to implement and select different initiatives which were submitted as proposals and elaborate the programme for the coming year. Laila Sbiti is a young Moroccan who is the President of ANIMA Investment Network, which created a consortium with other associations and obtained the offer launched by the European Union for the funding of SMEs in the region, what the plans and objectives of this consortium? Interview…
Is the objective of the consortium to attract more European investments to the South-Mediterranean countries ?
It happened that the European Commission launched a call for offers aiming at reinforcing the attractiveness of the Mediterranean. Anima Investment Network was the basis for the European programme, over a period of 5 years, and which consisted in reinforcing the capacities of people in charge of investment in the different South-Med countries. They offered a lot of training, seminars and meetings. Then, we thought of creating some everlatingness for this programme, and we created this association which was the winner of the call for bids. The consortium Anima Investment Network, the leader, and the members : ASCAME, UMCE and others, as well as associated members such as GTZ and Euroméditerranée.
And what are the objectives of this consortium ?
We have three objectives. First, we have to promote co-development, improve attractiveness to attract more foreign direct investments, North-South, but we also have to reinforce South-South and the third objective is the development of trade flows between the different partners. We do have some means, such as the possibility to finance operations, which are BtoB meetings. We are looking for enterprises in one South-Med country and a counterpart in North-Med countries to work together. We are trying to reinforce the attractiveness of the site. This means, determine excellence sectors, reinforce the sectors, provoke BtoB meetings in these sectors etc…
This consists in a series of concrete initiatives which will yield results in the three coming years and would help to decide whether we can do something together. And the fact that the network also includes entrepreneurs as well as chambers of commerce, associations and investment promotion agencies, makes it a whole with all the agents involved in the investment process. This gives a wider spectrum and better results.
Within the current context, we cannot avoid talking about the international financial crisis, the Tunisian leaders are saying that this crisis could be beneficial to Tunisian economy ! Do you share this opinion for the economy of the Mediterranean region ?
Well, there two analyses, there is this financial Tsunami, and as said by some university teachers, in the Mediterranean region, we have enough money and resources, but this money is not used as it should. A Moroccan, Tunisian or other small SME will get money from no one, not even the local banks. This is an international problem. SMEs and TPEs have difficulties to find funds. SMEs and TPEs cannot have their proper funds. I also wanted to talk about what is called the « Business Angels », this is very wall known is the United States, France and in other European countries, indeed, we created the first network of « Business Angels » in Morocco, as a tool to finance SMEs. These people invest their time and money, who already have a certain level of entrepreneurial development, but this helps young entrepreneurs and even to innovative projects to find funds. The real problem is finding funds. Unfortunately, our countries do not yet give the guarantees and insurances needed for foreign investment to be established. There is a political confusion, there is the social confusion, there are also stability problems in some countries, and there is the economic problem; all this makes a mixture, a “thick soup” with everything mixed. Even though the Mediterranean has resources, they remain not very well distributed, badly allocated. The resources are not really exploited, as the Mediterranean is a big importer and also lacks know-how.
There are also political problems which hinder the progress of this Mediterranean work?
Yes, this is true, reforms are needed at the level of some countries. We can see for example that all that has been done at the political and economic level during the past 7 years. All the countries are progressing, they do not progress at the same speed, but the problem is that we do not have time to integrate all this youth accessing each year the job market to ensure stability. There are more and more young people and not many jobs and not many durable economies to integrate them, so we are obliged to recourse to foreign know-how.
But isn’t this foreign know-how part of the co-development and co-operation process ?
This is why I said co-development, because we need better distribution of the value chain. For example we can, for the same product, produce a part in North Europe and the other in the South of Europe. Recently and within one of our off-shoring activities , two areas were inaugurated by the King of Morocco. And we saw in an aeronautics company high technologies in an informatics centre, and this is for us creation of added value. It is not about perfection, it is not about cabling, it is about calculations in aeronautics, design video games for example video games represent a market with 50 Billion dollars turnover in the world, imagine if we could take a small share for the Mediterranean, all these young people are dazzled with video games and they would like it as a job. In Morocco, we are opening the first school of video games in the end of 2008, this is wonderful because this is a small niche, no doubt, but it brings a mot of value added.
Isn’t the Southern shore of the Mediterranean ready for receiving technology produced in other regions of the world ?
In reality we are not really ready. We have very qualified people and we are aware that our development will not be achieved only with value added. What we need is be able to better promote our potential, better communicate around this potential and comfort investors about the Mediterranean and about our respective countries.
But how are we going to realise that, while European countries and other owners of technology are a little too conservative relating to technology?
It is normal that these countries behave so, they will share it only when they feel they are obliged to do so due to economic costs. This means, to be able to make their investments sustainable in their countries, they have to externalise a part of their investment into our countries. And unfortunately, the transfer of know-how and technology cannot be done easily, this is normal. Even ourselves, if we were very developed, we would not externalise our know-how into other countries. Currently, it is becoming nearly a necessity to be able to make the enterprise activity sustainable.
Will the South-Mediterranean countries then be specialised in the work of the end of the chain?
Be it the end of the chain or the cost, an engineer employed in Morocco, Tunisia or Lebanon does not cost as much as in the other countries. Imagine the cost reductions in terms of the work of development or research. An in addition to this, the resources are available, something scarce in Europe.
Let us talk about South-South context, don’t you think that when you stimulate local consumption you could generate important revenues for local enterprises and consequently for foreign investors ?
When we speak of local consumption, we should also mention the improvement in the living standards, that is improve the purchasing power, it is a vicious circle. Education is the basis for all this, it is the basic vital minimum, when you give a good education, you must improve the social conditions and then provide jobs. This cannot be done overnight. In our countries, there is a gap due to that a large part of our population did not access education, did not comply with some social rules, and who needs that big efforts should be made to integrate this layer of the population into development. But this has a cost and needs time, so we need to ensure this cost and this necessary time to be able to raise, and then we can increase the living standards and promote local consumption, this drives enterprises to establish and our countries become an important market. But I think that if we take the countries case by case, I really believe we can speak of a regional whole like what is being done in Europe, because a country alone can do nothing, we need to develop and promote a regional competence.
In the vision of your consortium, the Gulf investors have a major importance, what are the mechanisms you have to manage these flows and attract others ?
The Gulf investors came almost naturally in the Mediterranean countries, there was no specific effort. There is an orientation of their investments from OECD countries towards the Mediterranean. They are in Morocco, in Tunisia and in other Mediterranean and Maghreb countries. Now, we need to have a positive approach towards these flows, first there is this financial crisis, I’m not saying that Mediterranean countries are sheltered, but I am saying that they may benefit of this crisis. Because for some sectors of activity, mainly the services sector such as off-shoring, such as the off- shoring, the difference will not be interesting in the North of Europe, hence there will be more investments in South-Med countries. And this may be seen as an important opportunity for us. As to the Gulf countries, we should have a positive approach as well as investment proposals other than tourism and real estate. I mean we should even involve them in productive sectors such as industry, renewable energy, chemical processing, finance… But this is an approach which is nearly governmental to have a strategy.
Another point in your programme is the rapprochement of the private sectors in the Mediterranean countries ?
Within this framework, we are thinking an initiative particularly dedicated to Gulf countries. With a communication operation, suggestions for rapproching entrepreneurs. We thought of organising a forum on Mediterranean investment, this will be in Beyrouth next February 2009 !
And where does Africa stand here?
We would like to have Africa with us, we already have Mauritania with us!
Mauritania is part of the Maghreb !
For us, Africa is first. If Africa does not develop, we will not develop and immigration will continue. Unfortunately, I personally think that we are not doing enough for Africa, all the Maghreb countries look towards Europe. It is true there are many initiatives for Africa It is true that there are many initiatives for Africa, but unfortunately Africa is not appealing, to be able to convince entrepreneurs to establish there.