Eye on North Africa: November 2010

The month of November saw quite a bit of action in North Africa both economically and politically.

Most of the business news was from Morocco, with the biggest IPO in two years and some good news on the formal retail sector. Politically, the long-running dispute between Morocco and Algeria, focused on the Western Sahara, flared up somewhat unexpectedly, drawing in Spain and France.

Business and markets

The IPO of Moroccan insurance company CNIA-Saâda was the biggest IPO since mid-2008, when the global market meltdown and a drop in the amounts company owners could get for their shares dissuaded them from coming to market. CNIA’s IPO took the form of a sale of 12% of capital by Saudi prince Walid’s Kingdom Zephyr and another 3% by majority owner SAHAM, totaling €570m.

CNIA is the fourth-biggest insurer in the country, with a particularly strong presence in Casablanca, the economic capital. With annual earnings growth forecast to average 10% over the next three years, the price-earnings ratio at IPO of 14.3 seemed attractive to investors, and when the stock started trading on 22 November its price rapidly went up 27% in the first three days of trading.

In the retail sector the biggest news was a takeover by Label’Vie of Metro Maroc, a warehouse store retailer with eight big outlets in seven cities. Label’Vie is second to the Acima-Marjane behemoth in the relatively new retail business in Morocco, but its partnership with Carrefour on branding and logistics, along with this takeover which gives it plenty of space in which to roll out Carrefour-branded hypermarkets, may be a game-changer. Label’Vie will pay $150m for Metro.

Tunisia had a fairly quiet month on the stock market, and Algerian business, as always, rolls along at a sclerotic pace. Algeria would have been happy at signs this month that Russia is speeding up its plans to export gas to China, since Gazprom is the main competitor to Algeria’s giant Sonatrach in the European market.


Newspaper headline writers’ favourite North African, Muammar Gaddafi, was eclipsed in the news in November by some ugly developments in Morocco related to the Western Sahara question. Until recently it had looked as though the Moroccan proposal of ‘interior autonomy’ for the territory was gaining acceptance at the UN, but then 20,000 people moved out of the city of Laâyoune into camps to protest their living conditions under the Moroccan government. Police moved to shut down the camp on 8 November, resulting in 12 deaths and hundreds of injuries.

The brutality and resulting publicity served the cause of the Algerian-backed Polisario front, which demands a referendum on full independence, and gave rise to some anti-Moroccan speeches from Spanish and French politicians. In response, the Moroccan government organised a march of over a million people on the 28th, calculated to echo the ‘Green March’ that effectively marked Morocco’s taking back of the Sahara when the Spanish left in 1975.

Francois Conradie has several years’ trading experience on stock markets in Tunisia and Morocco, and currently writes about politics and economics in the region and in Africa generally. He is also the founder of Cape Town-based Meniscus Consulting. He can be contacted at [email protected]