World Bank Approves $US500 Million to support Morocco’s financial and digital inclusion reforms
The World Bank Board of Executive Directors approved today a US$500 million Financial and Digital Inclusion Development Policy Financing (DPF) program, which will support key policy reforms to promote an enabling environment for digital transformation. Building on continuing government reforms, the current DPF – the first in a programmatic series of three operations – seeks to improve financial inclusion and access to more competitive digital infrastructure and services for businesses and individuals. It also aims to spur private sector growth through access to finance for startups and youth-led enterprises.
“The Covid-19 outbreak demonstrated the paramount importance of digitalization as a means to ensure business continuity and promote innovation. During this crisis, Morocco’s digital transition accelerated rapidly, showing the country’s capacity for a greater scale up. Today, more than ever, digitalization opens new opportunities for Morocco, ranging from more fluid economic transactions to better services to citizens and businesses,” said Jesko Hentschel, World Bank Maghreb Country Director. “Through the current support, we aim to boost this potential and leverage digital transformation for more inclusive growth.”
The DPF, the objectives of which were revised to address emerging priorities related to the outbreak, will support the Government’s efforts to digitalize key services for individuals and businesses and strengthen the resilience of households and firms.
“Access to finance through digital financial services, credit, social protection programs, and insurance will allow individuals and households to start and expand businesses, invest in education or health, manage risks, and improve the overall quality of their lives,” said Djibrilla Issa, Lead Financial sector specialist and Task team leader.
In addition to promoting microfinance, the program will support access to foreign currency for startups. “This is a critical measure for innovative Moroccan startups that are striving to compete locally and globally. It will allow them to import digital services that are not available in Morocco in order to enhance their product and service offerings and boost their competitiveness,” said Dalia Al Kadi, Senior Economist and co-Task team leader.
Digital connectivity, the backbone of the current reform momentum, requires the availability of a reliable, safe, and competitive digital infrastructure. “It is especially critical to promote digital inclusion across the country so that no one is left behind, including in rural areas. This requires reforms to further promote competition and investment in order to expand access to broadband services. Access to broadband infrastructure proved to be vital for business continuity during the crisis and will play a key role in the post-COVID-19 economic recovery,” said Arthur Foch, Senior Digital development specialist and co-Task Team leader.
The program will support key policy reforms to promote competition and universal access in the telecommunication and broadband sector, providing opportunities for the digital transformation of enterprises and administrations.
The DPF also paves the way for the Intelaka entrepreneurship program by supporting reforms conducive to startups’ development and creating new asset classes for early-stage financing for innovative enterprises. Finally, the program supports the participation of small businesses in government procurement as an enabler for economic inclusion and recovery.