France’s new investment fund in the Maghreb- is it enough?

Morocco is in line to be a major recipient from a new €100 Million fund it was announced on 19^th June. The fund has been set up by the French Investment Bank and comes at a time when French influence throughout the Maghreb and the shrinking Francophone, is in retreat. This new initiative is the clearest demonstration yet of the concern being felt in Paris at France’s diminishing reach throughout Africa. 

Officially the new investment fund aims ‘to capitalize on the growing dynamism of the Maghreb economies’. And while there may be growing dynamism, the effects of the global pandemic, wars in Ukraine and the Middle East and pressure on energy prices has affected even some of the stronger regional performers. As the effects of the shocks begin to fade away, Morocco’s growth accelerated in 2023, supported by the partial recovery of agricultural production, renewed growth in the tourism sector, and the positive contribution of net exports. And yet, even before the announcement of this heavily politicised, yet welcome plan, trade between Morocco and France totalled 14.1 billion euros, an increase of 5 per cent in the same year.

While relations between France and the Maghreb have been strained in recent years due to trade imbalances and political tensions, trade has showed relative resilience with other countries in the region as well. For instance, trade between France and Algeria in 2023 reached €11.8 billion, with growth of 5.3 per cent on the previous year, boosted by hydrocarbon exports. The funding programme, which covers the period 2024-2027, targets several strategic sectors such as industry, energy, agriculture and pharmaceuticals.
It aims to support French companies wishing to strengthen their presence in the region, particularly in Morocco, Algeria and Tunisia, offering French companies financing, guarantees and assistance in setting up projects with local partners, with the aim of stimulating strategic partnerships in the region. The official statement that accompanied the announcement made said:

‘This investment fund marks a new stage in Franco-Maghrebian relations, with the aim of revitalising and diversifying the economic partnership
in the coming years and restoring positive momentum in a strategic region of Africa for France.’

While investment will be welcome, questions will inevitably be asked about the fact that the fund appears to be primarily aimed at assisting French firms who want to invest or expand in the region, so while there may be some positive spin off economic benefits, this does not amount to a direct investment in local or national companies in the Maghreb. Allied to this is that despite all of the warm words and fanfare, €100 million over three years does not in the grand scheme of things amount to a great deal. 

France may have to do better.  

*Mark Seddon is a former Speechwriter to UN Secretary-General Ban ki moon & former Adviser to the Office of the President of the UN General Assembly