Transcript Tunisia - Konrad-Adenauer

The role of the private sector
in the Maghreb
Karim Ben Kahla
Ecole supérieure de commerce de Tunis
Konrad Adenauer Stiftung
December 2007
1
• The private sector in the Maghreb is facing
challenges and threats but is still
underdeveloped.
• Why are things changing (?) too slow??
2
The role of the private sector (1): low
entrepreneurial density
Number of
« SME »
312 959
Per 1000
inhabitants
10,3
Morocco
450 000
15,2
Tunisia
455 498
41,40
Turkey
3 960 000
56,6
Czech Republic
1 985 004
194,2
Algeria
3
The role of the private sector (2): relative
stagnation of the private investment to GDP
1980’s
1990’s
Morocco private
investment to GDP
12,1
10,1
Tunisia private
investment to GDP
13,6
14,9
4
The role of the private sector (3): indicator for
Lobby power of the manufacturing sector
(Nabli, 2007) (the more concentrated the manufacturing sector, in terms of a few export categories, the more
manufacturers could be expected to band together with a common interest to influence the government’s policies)
Algeria
0,01
Morocco
0,36
Tunisia
0,48
Libya
0,00
MENA
0,13
High-Income OECD
0,51
5
The role of the private sector (4): financing companies
(some problems and limits of “poor” companies)
Algeria
Tunisia
Morocco
Egypt
Jordan
Stock
0,22% (en
market
2003)
capitalizati
on/GDP
10,3%
54,8%
81,8%
292,5%
Share of
domestic
credit
directed to
the private
sector,
2003 (Nabli,
11,5%
69,0%
55,1%
61,5%
71,7%
(123,0 for
High
income
OECD)
30%
(2006)
21%
(2006)
15,7%
(2005)
25%
2007)
NPL
6
The role of the private sector (5): other
inhibiting factors
1.
2.
3.
4.
5.
Weight of the informal sector and anti-competing
practices
Lack of skills and brain drain (enhance quality
and not only quantity of high education,
graduated unemployment problem)
Low manufacturing productivity and productions
with low added value
Low diversification of products and markets (exp:
dependence on Europe for exports, on oil,
textile)
ICT fracture
7
Algeria
Tunisia
Morocco
Lebanon
Turkey
Numbers
microcom
puters
(1000 px)
8
31
24
81
45
Numbers
Net
surfers
(1000px)
16
52
24
117
73
8
Why? First response: poor legal frame for doing
business
9
Why? second response: Bad
governance indicators (the experts
opinion)
Quality of
public
administration
Public sector
accountability
Overall
governance
Algeria
44,1
42,3
42,5
Morocco
57,8
47,9
51,1
Tunisia
58,4
37,1
44,3
MENA
47,3
35,1
39,4
OECD
79,6
97,5
90,2
10
Why? Third response: the choices of
industrial policy (at the beginning)
• The “Makhzen” in Morocco, the “Moudjahidine” and the
army in Algeria, the “ottoman bureaucrats” in Tunisia
• Vertical industrial policy ((sector or firm specific) produces rent
seeking (distortions) and corruption opportunities)
• Import substitution
• Protecting infant industry and public enterprise
• The social (and political) function of the public enterprise
is privileged
• State capture of the banking and insurance sectors
• Price controls
• Tight (but often bad) planning
11
Why? Third response: the industrial policy:
Hesitations about privatizations
Period
Number/total
envisaged
Receipts
Remarks
Algeria 19952005
275/ 731
EPE
800
millions
USD
-25% of the entities bought by
foreigners
-the employees profit from 10%
of the capital, on a purely
gracious basis
Tunisia 19872006
201/310(?)
1893
millions
USD (2,483
- 74,34% (1846 MDT) of foreign
investments
MilliardsDT
(TT: 3,052
milliards DT))
Moroc
co
19892005
70/114
8416
millions
USD (76,7
milliards de
dirhams)
-foreigners = 77.7% cash
- workers: 0,7% of the cash
(reduction of 15% on the price)
- stock exchange capitalization
12
multiplied by 23
Why? Third response: the industrial policy:
the delay of the “mise à niveau”
Mise à niveau
industrie
Algeria
418 / 23639
Morocco
363 / 7737
Tunisia
3470 / 5458
13
Beyond the industrial policy: Core attributes
of social contract in MENA
( Nabli, 2007, p 144)
1.
2.
3.
4.
5.
6.
The preference of states over markets in managing
national economies
A reliance on state planning in determining economic
priorities
A penchant for redistribution and equity in economic
and social policy
An encompassing vision of the role of the state in the
provision of welfare and social services
A vision of the political arena as an expression of the
organic unity of the nation rather than as a site of
political contestation or the aggregation of conflicting
preferences
The emergence of centralized, hierarchical, and tightly
regulated corporatist structures of interest groups
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Why? fourth response: from economic to political, social
and business contracts: some aspects and dilemmas (1)
• The dilemmas of the paternalist state/leader:
– The powerful (but illegitimate) State (the more
intervention, the more centralization and the less
legitimacy)
– Protection permits growth but over protection hinders
growth (great states versus infant society, industry, etc.
– The trap of economic and political leadership
• The endless reforms:
– The urgency of reforms versus the slowness of trust
construction
– The “game” of reform: main actors adapt to reform rather
than challenge it (sometimes they reorganize
opportunities for continuing rent seeking)
– The (practical, cultural and ideological) unwillingness and
inability to form coalitions for real change (due mostly to
the pervasiveness of information and interpretation)
15
Why? fourth response: from economic to political,
social and business contracts: some aspects and
dilemmas (2)
• The neutralizing exchange: exchange of economic (and
sometimes social) protection against political complicity
(and sometimes neutrality)
• “Soft” (capture of rent) and “hard” (capture of state)
corruption:
– The instrumentation of institutions: Trade unions (and other
unions) are an instrument for organizing support for
comprehensive reform
– Large scale private sector (when it exists) is dominated by
industries that benefit from status quo and that are capable of
“state capture” of government regulation
– State capture by other private interests
• The silences of the international “agreements” and
contracts
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• Beyond the “simple” contracts: where and
how?
– Where must we (try to) exercise power:
strategy (example: where ton invest?)
– How must we (try to) exercise/control power:
governance (example: how to prevent or
resolve potential conflicts)
• Modernization and modernity challenges
17
Strategy (multilevel analysis)
•
Modernization challenges (the technocratic
and economic side of “choosing” contracts)
•
•
Where to contract?
How to evolve from a reactive strategy ( attendant ) based on the
costs and the revenues (lobby which resist the opening and the
Maghreb) to a proactive strategy based on innovation and quality
How to Integrate the collective (example maghrebean) dimension
into the strategic individual reasoning and choices (to avoid the
blindness or strategic myopia)
•
18
Strategy (multilevel analysis)
• Modernity challenges (values for private
and collective contract choice)
• Opportunism: Confusion between opportunity and strategy
(confused and anarchistic diversifications without any connection
with the original competences and the basic trade of the company)
• Fatalism: Confusion between calculated risks, rizk (that one already
has or that is given by God)) and fatality
• Mimetism and mimetic behaviors (implies very little diversified
economies where imagination is broken down)
• formalism and conformism attraction ("to protect oneself" by the
imposed rules or the group rather than to express itself).
• “one best way” attraction (imported)
19
Governance (multilevel analysis)
• modernization challenges (the technocratic
and economic side of contracting)
• What to do with minorities?
• Evolve from an exclusive and centralized
governance to an inclusive and shared
governance (opened or in network)
• Promote real dialogue (avoid the “dialogue of the
deaf”)
• Promote a maghrebean governance (divided or in
networks)
20
Governance (multilevel analysis)
• Modernity Challenges (values inherent to
contracting)
• Promote meritocracy
• Escape clientelism
• Build a communication based on empathy, explicit discourse and
clearness (to avoid the blur and the over-interpretations)
• Build trust, debate and shared power (mistrust between the public
and the private sector; the owner and his subordinates who entertain
a seigniorial relation where the allegiance replaces competence, the
injunction the debate, the clan is preferred to the network and where
the company is under- institutionalized and its life cycle depends
upon that of his leader )
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Conclusion
• The role of the private sector in Maghreb could be much
more important
• Limitations are due to legislation, governance and
industrial policy
• Beyond these factors lies the social contract and there
is a strong interaction between social, economic and
business contracts
• These contracts refer to modernization and modernity
challenges concerning two multilevel problems: were we
choose to exercise power (strategy) and how we do that
(governance)?
• Managerial and intellectual elites could/should interact to
make evolve these contracts
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Thank you for your attention
Karim Ben Kahla
http://credo.iquebec.com
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