The Middle East and North Africa Transition Fund held its second steering committee meeting in the Moroccan capital, Rabat last month. Four new grants  were awarded at the meeting in support of the ongoing reform process in Morocco. Jonathan Walters, World Bank coordinator for the Transition Fund was in Rabat and provided us with some background on what the Fund hopes to achieve both in Morocco and the region.
Why was the Transition Fund created and what is its purpose?
Jonathan Walters: In May 2011, the Deauville Partnership with Arab Countries in Transition was launched as a long-term, global partnership to respond to the historic changes in some of the countries in the Middle East and North Africa (MENA) region. Subsequently, in April 2012, the Partnership endorsed the creation of the MENA Transition Fund.
The Transition Fund aims to improve the lives of citizens in transition countries and to support the transformation currently underway by providing grants for technical cooperation to strengthen governance and public institutions and foster sustainable and inclusive economic growth by advancing country-led policy and institutional reforms.
Donors who have so far pledged to the Transition Fund are Canada, France, Japan, Kuwait, Qatar, Russia, Saudi Arabia, Turkey, the United Kingdom and the United States, with contributions amounting to US$171 million. The United Arab Emirates has also indicated its intention to contribute.
The Transition Fund currently provides support to Egypt, Jordan, Libya, Morocco, Tunisia and Yemen. Other countries in MENA may become eligible to receive financing from the Transition Fund in the future. Within the six countries, public sector entities are eligible to benefit from the Transition Fund including government, judicial bodies, central banks, other state agencies and parliaments.
How can the Transition Fund help the region establish a robust growth dynamic, especially during a transition period?
JW: The Transition Fund provides instrumental financial support to complement other multilateral and bilateral initiatives to provide additional financing to help countries scale up transformational and cross-cutting proposals across a broad range of inter-related thematic areas. The scope of the Transition Fund includes investing in sustainable growth, inclusive development and job creation, enhancing economic governance and supporting competitiveness and integration, all critical in developing a sustainable growth dynamic.
Can you tell us about the projects in Morocco that have benefitted from Transition Fund support?
JW: The Transition Fund’s Steering Committee approved four projects for Morocco last February, one of which is a regional project, totaling US$17.08 million. The projects target key areas of development, namely governance, micro-finance, logistics, and micro-entrepreneurship for young people.
The first project, titled New Governance Framework Implementation Support Project (US$4.5 million) will support the adoption and implementation of policies and laws enabling better public participation in government affairs, greater efficiency and accountability in the use of public funds through the adoption of performance based budgeting and improved fiscal decentralization and self-administration of local governments. The project complements the Transparency and Accountability Development Policy Loan series under preparation in order to offer a comprehensive and integrated support package to Morocco’s current governance transition, which was in response to popular demands derived from the Arab Spring for greater government transparency and social accountability.
At the heart of Morocco’s strategy to create greater economic opportunities for youth, the Strengthening Micro-entrepreneurship for Disadvantaged Youth in the Informal Sector Project obtained a US$5.5 million-grant. Over the course of four years, the pilot project is expected to provide at least 5,000 disadvantaged young men and women between the ages of 15 and 29 with access to business development services. The project will also help reinforce the institutional capacity of national and local stakeholders to provide assistance to youth in starting and growing their micro-enterprises, as well as support learning from the pilot to facilitate an informed scaling-up. The project will be implemented by the Ministry of Youth and Sports.
Promoting access to finance to low income households and micro and small enterprises is the main objective of the Microfinance Development Project (US$5.51 million). The project will help strengthen the institutional, legal, regulatory and governance framework of the microfinance sector, promote market infrastructure, product innovation and funding sources for microfinance and integrate microfinance into a national financial inclusion strategy. In addition, the project will also enhance female labor force participation.
Finally, a regional project called the Regional Logismed Project (of which Morocco’s share is US$1.57 million) will aim to set-up a network of Euro-Mediterranean logistics platforms in order to serve as a support for the modernization of an essential industry, such as the logistics one, and to work for the establishment of the Euro-Mediterranean free trade area. The objective of this project is to support the enhancement of logistics platform capacities in Egypt, Morocco and Tunisia to create a collaborative network between these logistic platforms in order to improve country capacities and to attract foreign investments.
For more information please visit: http://www.menatransitionfund.org/content/overview