Morocco boycott revives debate over business, politics links

Afriquia is one of three well-known brands being boycotted following criticisms over links between the country's business and political elite. (Shutterstock)
Updated 27 May 2018
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Morocco boycott revives debate over business, politics links

RABAT: More than a month after its launch, an unprecedented boycott campaign in Morocco against three well-known brands has revived criticism against links between the country’s business and political elite.

Spreading like wildfire across social media, the campaign is targeting Afriquia service stations, Sidi Ali water and Danone milk — leaders in their sectors — and calling for a drop in prices.

Despite brand communication efforts to curb the campaign, AFP saw its popularity in cafes, shops and deserted Afriquia petrol stations in several Moroccan cities.

Some 57 percent of Moroccans are actively engaged in the boycott, according to a survey of 3,575 mostly middle class Moroccans published this week in the country’s L’Economiste newspaper.

The Afriquia group belongs to billionaire Aziz Akhannouch, the richest man in Morocco, minister of agriculture since 2007 and head of the National Rally of Independents (NRI) technocrat political party.

The boycott carries “a symbolic message from the middle class” against the marriage between political power and big business, political analyst Aziz Chahir told AFP.

Ahmed Bouz, another political analyst, said the campaign shows “awareness of the need to separate politics from business.”

The Moroccan press frequently covered conflict of interest throughout the 2000s, placing a sharp focus on the royal family and the National Investment Company — since transformed into a holding company and renamed Al Mada.
The enrichment of the country’s ruling elite resurfaced in 2011 as the popular revolts of the Arab Spring swept across the region.

Consitutional reform that year fueled hopes for change, but the current government — formed in 2017 by the Islamist PJD party — brought in more technocrats and businessmen, along with accusations of conflict of interest.

Moroccan media and activists accuse Trade Minister Moulay Hafid Elalamy — who heads one of the country’s largest conglomerates — of helping to pass a favorable tax provision for the transfer of his Saham insurance company to South African giant Sanlam.

Elalamy says he has complied with the law and asked for an inquiry into the transaction to prove his innocence.

“Nothing in the law prohibits businessmen from holding government positions,” Abdelali Benamour, head of Morocco’s Competition Council, told AFP.

Fouad Abdelmoumen of Transparency Moroc said: “The state has not put in place mechanisms that define conflicts of interest and that contain excesses.”

Excessive profits in big business — especially fuel distributors like Afriquia — has also stoked anger among Moroccans.

A mid-May parliamentary report on the evolution of fuel prices since their liberalization in 2015 caused an uproar.

The final version of the report — its most glaring figures redacted — put the sector’s profit margins above $1.5 billion ((€1.3 billion).

The alliance between business and politics appeared again in headlines Tuesday, when Salaheddine Mezouar — former finance minister, trade minister and head of the NRI — was elected head of Morocco’s private business sector.


Foreign investors hope India dials back policy shocks after Modi win

Updated 24 May 2019
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Foreign investors hope India dials back policy shocks after Modi win

  • Modi’s pro-business image and India’s youthful population have lured foreign investors
  • After Modi’s win, about a dozen officials of foreign companies in India and their advisers said they hoped he would ease his stance and dilute some of the policies

NEW DELHI: Foreign companies in India have welcomed Prime Minister Narendra Modi’s election victory for the political stability it brings, but now they need to see him soften a protectionist stance adopted in the past year.
Modi’s pro-business image and India’s youthful population have lured foreign investors, with US firms such as Amazon.com , Walmart and Mastercard committing billions of dollars in investments and ramping up hiring.
India is also the biggest market by users for firms such as Facebook Inc, and its subsidiary, WhatsApp.
But from around 2017, critics say, the Hindu nationalist leader took a harder, protectionist line on sectors such as e-commerce and technology, crafting some policies that appeared to aim at whipping up patriotic fervor ahead of elections.

Opinion

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“I hope he’s now back to wooing businesses,” said Prasanto Roy, a technology policy analyst based in New Delhi, who advises global tech firms.
“Global firms remain deeply concerned about the lack of policy stability or predictability, this has sent a worrying message to global investors.”
India stuck to its policies despite protests and aggressive lobbying by the United States government, US-India trade bodies and companies themselves.
Small hurdles
Modi was set to hold talks on Friday to form a new cabinet after election panel data showed his Bharatiya Janata Party had won 302 of the 542 seats at stake and was leading in one more, up from the 282 it won in 2014.
After Modi’s win, about a dozen officials of foreign companies in India and their advisers told Reuters they hoped he would ease his stance and dilute some of the policies.
Other investors hope the government will avoid sudden policy changes on investment and regulation that catch them off guard and prove very costly, urging instead industry-wide consultation that permits time to prepare.
Protectionism concerns “are small hurdles you have to go through,” however, said Prem Watsa, the chairman of Canadian diversified investment firm Fairfax Financial, which has investments of $5 billion in India.
“There will be more business-friendly policies and more private enterprise coming into India,” he told Reuters in an interview.
Tech, healthcare and beyond
Among the firms looking for more friendly steps are global payments companies that had benefited since 2016 from Modi’s push for electronic payments instead of cash.
Last year, however, firms such as Mastercard and Visa were asked to store more of their data in India, to allow “unfettered supervisory access,” a change that prompted WhatsApp to delay plans for a payments service.
Modi’s government has also drafted a law to clamp similar stringent data norms on the entire sector.
But abrupt changes to rules on foreign investment in e-commerce stoked alarm at firms such as Amazon, which saw India operations disrupted briefly in February, and Walmart, just months after it invested $16 billion in India’s Flipkart.
Policy changes also hurt foreign players in the $5-billion medical device industry, such as Abbott Laboratories, Boston Scientific and Johnson & Johnson, following 2017 price caps on products such as heart stents and knee implants.
Modi’s government said the move aimed to help poor patients and curb profiteering, but the US government and lobby groups said it harmed innovation, profits and investment plans.
“If foreign companies see their future in this country on a long-term basis...they will have to look at the interests of the people,” Ashwani MaHajjan, an official of a nationalist group that pushed for some of the measures, told Reuters.
That view was echoed this week by two policymakers who said government policies will focus on strengthening India’s own companies, while providing foreign players with adequate opportunities for growth.
Such comments worry foreign executives who fear Modi is not about to change his protectionist stance in a hurry, with one offical of a US tech firm saying, “I’d rather be more worried than be optimistic.”