Although GDP growth slowed in 2012 on the back of reduced demand from Europe and lower-than-average agricultural output, Moroccan banks continued their solid growth trend, paving the way for further expansion in 2013. The introduction of the country's first Islamic bank, slated for this year, should also provide opportunities for foreign banks.

Combined banking profit grew from Dh9.72bn (€871.19m) in 2010 to Dh10.1bn (€905.26m) at the end of 2011, a record high. According to the most recent figures from Bank Al Maghrib, the central bank, total profits had reached Dh6bn (€537.78m) as of June 2012. This represents a 3.8% increase from Dh5.7bn (€510.89m) over the same period in 2011, indicating the sector would see a strong finish to the year.

Over the last decade, trade between African countries and the rest of the world has grown significantly and, in particular, charting a 170% increase in trade with the GCC.

The ongoing shift by African countries from being aid-dependant to increasing trade and investment ties with the Middle East has positioned Islamic finance to play a key role in facilitating further increases in trade and investment flows between Africa and the Middle East.

Morocco's central bank has started talks with a body of Islamic scholars on establishing a central sharia board to oversee the country's fledgling Islamic finance industry, a central bank official said.

The board, composed of scholars and financial experts, would rule on whether instruments and activities complied with sharia principles. Its creation would be a step towards establishing full-fledged Islamic banks in Morocco.

Responding to increased interest in developing Islamic finance, the International Monetary Fund (IMF), Central Bank of Tunisia (CBT), ) and the Islamic Development Bank (IsDB), organized a three-day regional conference in Tunis on December 17 to exchange knowledge and share experience in building technical capacity in Islamic Banking and Sukuk Markets.

Morocco is drafting its own sukuk law in order to keep up with its neighbors after global sukuk offerings reached a global record.  Although Moroccan officials have not said when the law is expected to go into effect, both Egypt and Tunisia are drafting laws to enable Islamic bond issues by 2013.

It has been reported that supportive socio-political factors and economic incentives shouldaccelerate the growth of Islamic banking activities in North Africa from currentlow levels, according to a new report
published by Standard & Poor's Ratings.


Services titled "Prospects For Islamic Banking In North Africa Improve Following The Arab Spring." Islamic banking started to emerge in North Africa in the 1970s when Egypt was among the first countries in the Arab world to authorize the establishment of pioneer Islamic banks.

There is buzz about the prospects for Islamic finance in parts of the Middle East and North Africa region (MENA) impacted by the Arab Spring. News reports suggest that, as a consequence of change in public policy, the market share of Islamic banking in Egypt will grow to “35 per cent in five years from 5 per cent now.” Much attention in Islamic finance circles is also falling on the relatively smaller markets, including Oman and Morocco. Observers, including researchers from Credit Suisse, are also pointing to Islamic finance as a potential spur to economic growth in the Arab Spring countries. 

Islamic banks may soon gain a foothold in Morocco. The move has been expected since the Justice and Development Party (PJD), advocates of Islamic finance, came to power.

The parliament is set to vote on the new draft banking law in September. The bill will include a special chapter dealing with Islamic banking, according to Central Bank Governor Abdellatif Jouahri.

S&P Indices announced Friday the launch of the S&P/OIC COMCEC 50 Shariah Index, which is designed to measure the performance of 50 leading Shariah-compliant companies from the member states of the Organization of Islamic Cooperation (OIC). The Index has been designed in partnership with the OIC.

Morocco is considering a potential dollar-denominated international bond of up to $1 billion in September or October, a senior finance and economy ministry official said on Wednesday. 

“It would be our first issue in dollars and give us the opportunity to diversify,” said El Hassan Eddez, deputy director, treasury and external finance at the ministry's debt office.