Maghreb countries (Morocco, Algeria, Tunisia) ICT markets are growing rapidly. Finpro's ICT Maghreb project seeks to find business opportunities for Finnish companies in this market. This is a final report of the project.

1. ICT Maghreb
12/10/2011

2. Table of Contents
Introduction to the Project Pag. 3
Executive Summary Pag. 4
Maghreb as a Region Pag. 5
Tunisia Pag. 6
Morocco Pag. 31
Algeria Pag. 77
Project financing Pag 106
Conclusions and Reccomendations Pag. 108
Primary sources Pag. 112
.
12.10.2011 © Finpro 2

3. Introduction for the project
Background Information Methodology
• ICT-markets in Maghreb are in an interesting • The study used both desk and field studies
development phase • In the desk study phase material on the ecosystem
• Maghreb and its opportunities are not known to the was collected
Finnish companies • Interviews of the main players like mobile operators,
• The aim of this project was to investigate the software companies and industry experts were used
opportunities in Tunisia, Morocco and Algeria to get a view on the concrete business opportunities
• The project was financed by TEM
Assignment Objectives Project team
• Understand the ICT-ecosystem Finpro team members
• Identify concrete business opportunities for Finnish • Marjaana Karjalainen, Head of Trade Center, Finpro
ICT companies Italy (Project Manager),
• Formulate market entry recommendations marjaana.karjalainen@finpro.fi
• Initiate networking with local key players • Anneli Virtanen, Head of Trade Center, Finpro Tunisia
(Tunisia), anneli.virtanen@finpro.fi
• Steve Colling, Senior Consultant, Finpro France
(Morocco and Algeria), steve.colling@finpro.fi
12.10.2011 © Finpro 3

4. Executive summary
 ICT-markets in Tunisia, Morocco and Algeria are in an interesting development phase, but Finnish companies do not
yet know about the concrete opportunities the area is offering.
 The “Arab Spring” is paving way for democratic reforms in the area. For example the first democratic elections are
at hand in Tunisia.
 In all the three countries the ICT-sector is dominated by the public sector.
 Concrete business opportunities in these countries can be found especially in the following sectors:
 Mobile operators’ value chain as 3G networks are being launched and new services developed
 In vertical enterprise software markets like logistics, banking, e-tourism, e-learning and e-government
 Outsourcing and offshore activities.
 Tunisia and Morocco have a good infrastructure, educated work force and a good business climate for foreign
companies to develop their business.
 Algeria is still almost an untapped market with little competition.
 They can also be seen as gateways to the French-speaking Africa.
 In order to take advantage of advantage of the opportunities Finpro recommends a fact-finding trip to Tunisia and
Morocco in March 2012.
 For those who want to proceed at a quicker pace we suggest Test Drives to test the commercial feasibility of their
offering and to receive concrete client feedback as well as Partner Searches to evaluate potential partner candidates
12/10/2011 © Finpro 4

5. Maghreb as a region (Algeria, Libya, Mauritania, Morocco,
Tunisia)
• All states are members of the Arab
Maghreb Union (l’Union de
Maghreb Arabe, UMA). UMA
promotes regional integration
with emphasis on economic and
political co-operation.
• IMF (International Monetary Fund)
divides the region into three groups:
- Major oil producers - Algeria and Libya
- Emerging markets - Morocco and Tunisia
- Poorest country - Mauritania (oil production
started in 2006)
• The population of Algeria, Tunisia and Morocco is around
77 million and the proportion of Muslims is almost 100 %.
12.10.2011 © Finpro 5

6. Tunisia
Tunisia in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

7. Tunisia
Population 10.5 million
Area 163 610 km2
Capital Tunis
Languages Arabic, French
Currency Tunisian dinar (TND)
(1€ = 1.94 approx.)
GDP 2010 33.4 billion €
(per capita € 3180)
Minim. wage 121 € / month
(40 h work week)
Government Presidential Republic
12.10.2011
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8. Economic indicators
2010 2009 • Stable economic, political and
social situation enhances foreign
Unemployment 13.0 % 13.3%
trade
GDP growth 3.7 % 3.1%
Inflation 4.4 % 3.5 % • Competitiveness: 32nd among
FDI (M€) 1140.9 1212.1
139 countries, 1st in Africa (WEF
2010-2011)
Gross investment
as a % of GDP
24.3 % 24.2 %
800 GDP by sector 2010
600
Services
400
200 Manufacturing
0 industries
Agriculture and
fisheries
Non manufacturing
industries
Others
12.10.2011
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9. Trade
• Tunisian economy is diversified and competitive
• Tourism is still most important sector in Tunisia followed by manufacturing industry
and agriculture, but the focus is on technology and innovation based economy.
• In 2010 the country’s exports amounted to EUR 16 billion, whereas imports were EUR
15 billion, leading to a trade surplus. Tunisia's main exports are manufactured
products (clothing, machinery and transport equipment) energy and agricultural
products.
Trade of Tunisia (M€) Imports of Tunisia 2010
20000 Consumption
products (exc. food)
15000 Raw and semi-
finished materials
2009 Equipment products
10000
2010
Oil products
5000
Food products
0
Exports Imports Balance Others
-5000
12.10.2011
9
© Finpro

10. Trading partners
• European Union is Tunisia’s biggest trading partner. EU exports to Tunisia
amounted to EUR 8.9 billion and EU imports from Tunisia EUR 7.9 billion (2009)
• Tunisia has signed an Association Agreement with the EU. The trade of goods is
already liberated from customs, but negotiations of services trade and agricultural
products are ongoing.
• Major imports from the EU include machinery and transport equipment (38%),
textiles (13%), chemicals (9,9%) and energy (8,5%)
• Finnish exports to Tunisia reached EUR 53.6 million in 2010, whereas imports
amounted to EUR 8.6 million
• Finnish exports include industrial machinery, communications equipment, wood
and crude materials
Major export partners Major import partners
EU27 EU27
Libya Libya
India Turkey
United States China
Algeria Algeria
12.10.2011
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11. Key Tunisian companies
1 2 3
Tunisie Télécom STEG – Tunisian
STIR – Tunisian Leading telecom operator, Company for Electricity
Refining Industries partly state-owned
and Gas
Turnover: 827 M€
company State-owned
Turnover: 1155 M €
State-owned company that
operates under the Ministry
of Industry and Technology.
Turnover: 1225 M€
4 5
GCT – Group National Company of
Chimique Tunisien Oil Distribution AGIL
Phosphoric acid and fertilizer Commercializing of oil products
production, state-owned and their derivatives, State-
Turnover: 521 M€ owned
Turnover: 675 M€
12.10.2011
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12. Development policy
• Old government’s 12th Development Plan for 2010-2014 aims at improving
the standard of living for all Tunisians
• Goal: GDP up till 5.4 %, cutting unemployment to 11.4 % by creating
425 000 jobs
• Expanding health & social coverage  improving human development index
to the level of developed countries
• Creating knowledge based, innovation and technology driven society 
increasing the number of high-qualified engineers, creating employment for
the young graduates
• Developing infrastructure: € 12.250 billion to energy sector (e.g. solar & wind
power), € 4.512 billion to ICT sector (digital television, modernizing
telecommunication infrastructure), € 2.850 billion to scientific research and
technological development etc.
• Future development of the country depends on the outcome of the elections
in October 23,2011
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13. Doing business in Tunisia
• Exporting to Tunisia
• On the basis of the Association Agreement Tunisia is looking for preferential status
within the EU, i.e. “partenariat privilégié”.
• The most used method of payment in Tunisia is letter of credit - international
transfer and documentary remittance are also possible.
• Investing in Tunisia
• Good investment and business environment (69 th out of 183 countries in WB’s
Doing Business 2010) and fairly good banking system.
• Offshore advantages in taxation e.g. full tax exemption on exports-derived profits
for the first 10 years and taxation at a low rate of 10% after this period of ten years
for the life of the company.
• Tunisia continues to attract Foreign Direct Investment (FDI). Partnership plays a
major role as nearly half of foreign companies have mixed capital; they are
associated with Tunisians in joint venture.
• Corruption
• In 2010 Tunisia was ranked 59th out of 178 countries in the Corruption Perception
Index, ahead Greece, Italy and Romania, as well as most Arab and African
countries.
• Travel & safety issues
• No visa needed for Finns staying less than 3 months
• Safe country for foreign people, yet cultural issues must be considered
12.10.2011
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14. Tunisia
Tunisia in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

15. Tunisian ICT market
• Ministry of Communication and Technologies (Ministry of Industry and
Technology at present) is responsible for ICT sector development in Tunisia
• 1st country in Africa having an ICT based national strategy
• Government is promoting the use of technology in administration and education: e-
government, e-learning
• Tunisia will be a member of Board of Directors of the International
Telecommunications Union (ITU) 2011-2014
• Tunisia has positioned itself as a regional high-tech centre of the Maghreb
countries  emphasis on software technologies and services
• Global Information Technology report 2010-2011: Tunisia is the 35th out of 138
countries, 1st in Africa and in Maghreb (and gained 4 places from the previous
year)
• During recent years ICT sector has experienced strong growth. Sector accounted
for 11.4 % of GDP in 2009 and attracted EUR 2.1 billion for 2007-2011.
Sources: Tunisiaonlinenews.com 13.10.2010 , OBG:
the report - Tunisia
12.10.2011 © Finpro 15

16. Tunisian ICT market
• Technoparks
• Three technoparks focused on telecommunications and IT, Elgazala Technopark in
Tunis is the biggest one
Wide range of big international companies, as well as local and foreign SMEs (e.g.
Stonesoft) operating in Elgazala
Elgazala forms a synergy between research, training, industry and private sector
with research units, training establishments and an incubator for start-ups
• Over 1 800 private ICT firms are operating in the field of software design and
management, systems integration, distribution and retail, and internet service
provision
12.10.2011 © Finpro 16

17. ICT in general population
Tunisia Finland
Mobile phone penetration
106 % (2010) 156 % (2010)
rate
Fixed telephone lines as a
12 % (2010) 23 % (2010)
% of population
Internet users as a % of
38 %* (May 2011) 87 % (2010)
population
Households owning a
15.7 % (2009) 85.4 % (2010)
computer
* About 75 % ADSL subscriptions
12.10.2011
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18. ICT usage evolutions
90
80
70
60
50
Finland
40
30 Tunisia
20
10
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Internet users as a % of population
160 60
140 50
120
40
100
80 30
Finland Finland
60 20
Tunisia Tunisia
40
10
20
0
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Mobile phone penetration rates in % Fixed telephone lines as a % of population
12.10.2011
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19. ICT in organizations
• 90% of Tunisian companies connected to the Internet (2009)
• 47% of companies have their own website
• Rankings in the WEF Global Information Technology Report
• Firm-level technology absorption, 33 out of 139 countries
• Extent of business internet use, 64 / 139
• Government ICT use, 16 / 139
• Improved competitiveness through ICT at the heart of Tunisia’s national
Enterprise Upgrading Program (2009-2010)
• The program covers a good share of corporate ICT adoption costs by paying for up
to 50 percent of computer hardware costs, 70 percent of software costs, and 70
percent of some technical assistance costs
• Software acquisitions supported include: management, technical, collaborative and
document management as well as networking software
Source: WEF GITR
12.10.2011 © Finpro 19

20. Tunisia
Tunisia in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

21. Telecom market
• Fierce competition
• Three operators, Tunisiana, Tunisie Télécom (TT) and Orange, competing in a
market with the mobile subscription penetration rate at 106 % (2010)
• TT losing customers to Orange the current trend, Tunisiana holding its position
• Market dominated by pre-paid subscriptions
• Big changes and demand for applications ahead with the extension of the 3G
offering in 2011. Orange is already holder of 3G licence. TT has also got a 3G
licence and started to offer 3G services in July 2011. Tunisiana expects to have its
3G licence in November 2011.
• Orange to challenge TT in the fixed-line and broadband market
• TT’s fixed-line monopoly over since the entry of Orange
• TT has however control of substantial tranches of Tunisia’s telecoms infrastructure
• TT around 470.000 ADSL subscriptions against Orange’s around 36.000 3G
subscriptions (9/2010)
• Both TT and Orange offer WiMAX and VSAT services
• Tunisia has participated in pan-African RASCOM initiative intergovernmental
commercial satellite enterprise
12.10.2011
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22. Telecom operators
Tunisie Télécom Tunisiana Orange
Launched 4/2010
Activities Fixed, Mobile (2G, 3G), Mobile (2G) Fixed, Mobile (2G, 3G),
Broadband, Satellite Broadband, Satellite
Market share 41.4% (mobile) 53.3% (mobile) 5.3% (mobile)
Number of mobile 4.5 million 5.8 million 600.000
clients
Turnover (2009) N/A € 512 million N/A
Revenue per N/A € 7.96 N/A
mobile user
(monthly, Q409)
Ownership Tunisian state (65%) and Wataniya Telecom (50%) Divona Telecom (51%) and
Dubai Investment Group, and a consortium of France Telecom (49%)
TECOM-DIG / Emirates Wataniya and Princesse
International Holding (50%)
Telecommunications EIT (IPO planned for 2010)
(35%)
12.10.2011
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23. B2B solutions and services
• Characteristics of the demand
• IT landscape highly dominated by software
• Key activities are software development (financial, management and industry purposes),
tailored information systems (private and public sector), integrated systems (ERP), and
business process outsourcing
• Big demand in mobile applications, device to device applications and M2M solutions with
the extension of the 3G offering in 2011
• Sectors with demand for applications
- telecom operators
- government, institutions and agencies
- health
- tourism
- transport (road security)
- payment
- agriculture
- education
- mobile banking and finance
- post services
• WAP services, LBS, business solutions and integration
12.10.2011
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24. B2B solutions and services
• Challenges for local players
• Services and applications still marginal markets in Tunisia, lack of local expertise and
thus foreign technical assistance needed
• Tunisian consumers are used to have access to free content
• Lack of project management skills and quality of services
• Market opportunities
• All the mobile operators and the Ministry of TLC are together planning a multi-OS
platform for piloting 3G and LTE
• Deployment of 3G network and LTE presents a huge need for middleware solutions and
mobile consumer/enterprise applications
• Applications like Vodafone’s M-Pesa and Orange Money in Kenya (mobile money
transfer services) might become a killer application, as a half of the population does not
have a bank account
• At the moment mobile payments for third party services or mobile money transfers
(mobile wallets) are not allowed by the regulator. Currently only banks are allowed to
transfer money
• TunisieTélécom already has a mobile payment platform to be used after the de-
regulation will happen
• Orange has announced that it will launch MobileMoney by the end of 2011
12.10.2011
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25. B2B solutions and services
• The Tunisian dinar is expected to become freely convertible in 2014. This means a
big change for the banking sector and puts pressure to find adequate solutions for
e-banking. It also presents a step towards further internationalisation of the country
• Most interesting projects are in the public sector, such as e-government, e-health
and e-learning
12.10.2011 © Finpro 25

26. Media
• Foreign investment in the Media was allowed in 2008, although media legislation
is governing both content and financing
• TV & radio
• TV penetration rate 88.1 % (2009)
• 77 % of Tunisians have access to satellite dish (regional & international channels).
Private sector is gaining ground in terms of audience share (e.g. Nessma TV,
Hannibal TV)
• Tunisian Radio & Television establishment broadcasts Tunisia’s public channels
• Tunisian TV network is expected to be fully digitalized in the end of 2010, goal: 100
% Digital Terrestrial Television coverage by the end of 2015 (Office National de
Télédiffusion, ONT is in charge)  Opportunities for private companies
• Online Media
• Online media is growing rapidly, and the adoption of mobile internet will drive the
growth of online content
12.10.2011
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27. Software & SI companies
1 2 3
OXIA Telnet
Consulting, software Product engineering and
SunGard engineering and services for consulting company in innovation
Multinational provider of banking, finance and telecoms and advanced technologies
software and IT services sectors
4 5
HR Access Vermeg
Development and integration of Private limited liability corporate
products for Tunisian market. entity specialized in financial
Software maintenance and software
update. HQ in France
12.10.2011
© Finpro 27

28. Tunisia
Tunisia in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

29. Business models
• ISV (Independent Software Vendor) is the dominating business model
• Most locals not ready for SaaS (Software as a Service)
• Offshore advantages
• Tunisia offers a number of advantages to foreign companies:
- fiscal benefits for export-oriented firms
- produced goods can be exported to third countries
- research and development capacity
• Outsourcing
• Good location for business process outsourcing because of the highly
educated, underemployed human resources and lower cost structures
• Regulations for the ownership of foreign companies
• If you sell products manufactured abroad, a joint venture with minimum 51%
of Tunisian ownership is needed
• Rep office can be totally owned by a foreign company (e.g. Stonesoft)
• Support units, R&D units and Service units can be totally owned by a foreign
company
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30. Tunisia SWOT
Strengths Weaknesses
• Good business environment
• High education level and good ICT • ICT sector dominated by public
skills tendering processes which are difficult
• Developed and functioning for foreign companies
infrastructure • Political dimension of the business is
• Well developed outsourcing and still high
offshore activities • Limited market in size
• Gateway to other African countries
Opportunities Threats
• Operators looking for concrete solutions
to leverage their 3G investments • Developing a sustainable business
(platforms, services) takes time
• First democratic elections at hand • Competition is getting fiercer
12.10.2011 © Finpro 30

31. Morocco
Morocco in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

32. Kingdom of Morocco
Population
31,5 million (50% less than 25)
Area
446 550 km2 (excl. W. Sahara)
Capital
Rabat (largest city Casablanca)
Languages
Arabic (French, Berber)
Currency
Moroccan Dirham (1€ ≈ 11MAD)
GDP
€65 446 million
(per capita €2 076)
Minimum salary
0,90 € per hour
Government
Constitutional monarchy
Sources: Haut-Commissariat au Plan, Chiffres Clés 2009; HCP Recensement 2004.
12.10.2011 © Finpro 32

33. Economic indicators
2009 2008 Evolution of GDP/Capita in €
2500
Unemployme
9,1% 9,6% 2000
nt
1500
GDP growth 4,9% 5,6% 1000
Growth of 500
primary 29% 16,6% 0
sector
Growth of
secondary - 4,7% 3,6%
sector Moroccan GDP per sector
Growth of Primary
3,9% 4,1% 16 %
tertiary sector
Tertiary
FDI & private 55 %
2 367 M€ 3 137 M€ Secondary
loans
29 %
Transfers
4 465 M€ 4 717 M€
from migrants
Income from
4 696 M€ 4 938 M€ Sources: HCP, Direction de la statistique 2009;
tourism Office des Changes.
12.10.2011 © Finpro 33

34. Trade
• Growing trade deficit
• Imports 2,5 times larger than exports
• 60% of Moroccan exports from
• Raw and processed phosphates (acids & fertilizers)
• Cloth and footwear
• Food products (mostly fresh and processed fish, fruits and vegetables)
• 46% of Moroccan imports are capital goods and energy
• Rising share of capital goods (from 22 to 25%) and consumer goods (from 16 to
20%)
Sources: Office des Changes
12.10.2011 © Finpro 34

35. Trade
Evolution of Moroccan trade Main exports
(in MMAD)
350 000,00
180 000
300 000,00 160 000
140 000
250 000,00
51 394 Phosphate
Value in MMAD
120 000 products
200 000,00 Cloth & Footwear
100 000 18 810
Exports 27 877
150 000,00 Food
Imports 80 000 26 536
26 164 Electrical
100 000,00 60 000 machinery
23 961
14 328 Others
40 000 12 316
50 000,00
20 000 35 976 30 343
0,00
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2008 2009
Sources: Office
des Changes
12.10.2011 © Finpro 35

36. Trading partners
• In 2009 EU countries received 65,6% of Moroccan exports and supplied 56,4% of its
imports
• France and Spain are the main trading partners
• 24,5% of Moroccan exports and 15,7% of imports for France; 21,2% of exports and 12,1% of imports for
Spain
• China is now its 3rd largest supplier, ahead of USA, with respectively 7,8% and
7,1% of Moroccan imports
• Finland represented 0,65% of Moroccan exports and 0,53% of its imports
• Finnish exports to Morocco were 78 M€ and imports 19 M€
• Wood & paper (50%) and electric devices (21%) were the main exports
• Clothes (37%) and phosphates (33%) were the main imported products
Sources: oc.gov.ma; Tulli.
12.10.2011 © Finpro 36

37. Trading partners
Morocco Main Clients Morocco Main Suppliers
Europe Asia America Africa Others Europe Asia America Africa Others
7% 5%
7% 13 %
14 %
60 %
70 %
22 %
Sources:
oc.gov.ma; Tulli
12.10.2011 © Finpro 37

38. Key Moroccan companies
1 2 3
Groupe ONA Samir Maroc Telecom
turnover 2009: 3 393 M€ turnover 2009: 2 637M€ turnover 2009: 2 055 M€
Oil refining and distribution Former state-owned
Holding company with a
company owned by the Saudi monopoly, now a subsidiary of
portfolio of 20 firms in
Corral Group the French group Vivendi
distribution (Optorg), food
industry (Lesieur Cristal),
mining (Managem), telecom
(Wana) and finance
(Attijariwafa Bank)
4 5
Listed in Casablanca and
Paris stock exchange, with Akwa Group Groupe OCP
international subsidiaries turnover 2009: 1 800 M€ turnover 2009: 1 787 M€
mainly in Africa State-owned company with the
Holding company which main monopoly of phosphate mining and
activity is gasoline retail (gas processing
stations Afriquia) Largest Moroccan exporter (17% of
Its portfolio includes media, real Morocco exports in 2009 and more
estate, car parts companies than 30% in 2008)
Sources: Corporate websites; les500.com. c
12.10.2011 © Finpro 38

39. Development policy
• The King has set 2 main objectives:
• developing the economy around the sectors where Morocco has some competitive advantages
• reducing Morocco’s energy dependence
• 2 programs define the strategies:
• National Pact for Industrial Emergence 2009 – 2015
• Combines tax incentives for investors, training, modernization measures
for the institutions and regulation, financial assistance to SME and
creation of industrial integrated platforms
• 6 sectors, defined as the 6 World Crafts of Morocco are targeted by the
program:
• Off shoring (see also Maroc Numeric 2013)
• Automotive
• Aeronautic & Space industry
• Electronics
• Textile & leather
• Agribusiness
• Investment plan of 10 billion € over 10 years in renewable energies
• Morocco currently imports 95% of its energy. The objective is that wind
and solar energy would generate 42% of its energy by 2020
´Sources: emergence.gov.ma; Ministère de l’Energie, des Mines, de l’Eau, et de l’Environnment, mem.gov.ma
12.10.2011 © Finpro 39

40. Doing business in Morocco
• Exporting to Morocco
• Tariffs are applied on many imported products
• Investing in Morocco
• Morocco is highly accommodative to foreign investors
• Creation in 2009 of the Moroccan Investment Development Agency (AMDI), under
the Ministry of Industry, Trade and New Technologies
• Designed to inform and assist foreign investors throughout the different phases of
their project
• Corruption
• In 2009 Morocco ranked 89th out of 180 in the Corruption Perception Index scoring
3,3*, below the world’s average (4) and median (3,35)
• Morocco has set up a commission and voted several laws to fight corruption
• Travel & safety issues
• No visa required to enter the country
• No particular risk
Sources: AMDI; Transparency International; business-anti-corruption.com
*The country ranking 1st is the least corrupt., New Zealand in 2009, scoring 9,4.
12.10.2011 © Finpro 40

41. Morocco
Morocco in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

42. ICT sector in the economy
• Current general situation
• The ICT sector currently employs 32 000 people in Morocco
• 5 to 7 000 of these jobs are pure IT (such as software developers, programmers)
• 20 000 jobs work in client relation in call centers
• 5 000 jobs in IT business development, marketing…
• ICT generates 3 700 M€
• Excluding telecom, the sector generates 628 M€
• IT offshore activities has grown 270% faster than anticipated
• Altogether offshore activities generate a turnover close to 75 M€
• To develop the ICT sector, in 2009 the government has launched the Maroc Numeric
Plan
• Combines state-sponsored projects, investments in education, tax incentives for
R&D and FDI, and the creation of clusters
Sources: Maroc Numeric 2013; Apebi
12.10.2011 © Finpro 42

43. ICT sector in the economy
• Main objectives of the Maroc Numeric Plan by 2013
• Develop the domestic demand by boosting the use of IT in households, companies
and schools
• 20% of schools now have an internet access. The objective for 2013 is 100%
• Create 26 000 additional jobs
• Gain productivity in all sectors, adding 1 800 M€ to the GDP
• Multiply by 7 the revenues generated by the IT offshore activities
Sources: Maroc Numeric 2013; Apebi
12.10.2011 © Finpro 43

44. ICT sector in the economy
• Morocco to focus on the following sectors and around which specific techno centers
are being built:
• Multimedia
• Software development
• BPO
• Mobile application
• On-board electronic equipment
• Moroccan ICT sector is expected to grow 10% annually for the coming years
• In addition to the rise of a few local champions, this potential has already attracted
most of the French leading ICT firms (telecom operators, software and consulting
firms)
Sources: Apebi
12.10.2011 © Finpro 44

45. ICT in general population
Morocco Finland
Mobile phone
96,79% 144,59%
penetration rate
Fixed telephone lines
10,99% 26,85%
as a % of population
Internet users
32,19% 84,14%
as a % of population
PC
2,50% 50%
penetration rate
Sources: For the table, International Telecommunication Union's ICT Eye –database ; ANRT Sept. 2010 for Mobile Penetration rate; Union
Internationale des Telecoms.2009 figures. Other data, Apebi survey, conducted in 2007.
12.10.2011 © Finpro 45

46. ICT in general population
• 30% of households have a fixed telephone line
• Internet penetration rate is around 5%
• 70% of connections are 3G and 30% ADSL
• 17% of households have a PC (16% of which have a laptop)’
• The barriers for Internet and PC penetration rate in households are: the price, the
absence of need and analphabetism issues
Sources: For the table, International Telecommunication Union's ICT Eye –database ; ANRT Sept. 2010 for Mobile Penetration rate; Union
Internationale des Telecoms.2009 figures. Other data, Apebi survey, conducted in 2007.
12.10.2011 © Finpro 46

47. ICT usage evolutions
Internet users as a % of the population
90
80
70
60
50
Morocco
40
Finland
30
20
10
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: International Telecommunication Union's ICT Eye –database, 2009 figures.
12.10.2011 © Finpro 47

48. ICT usage evolutions
Mobile phone prenetration in Fixed telephone lines as % of
% population
160 60
140
50
120
40
100
80 30
60
20
40
10
20
0 0
2009
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2003
1999
2000
2001
2002
2004
2005
2006
2007
2008
2009
Source: International Telecommunication Union's ICT Eye
–database, 2009 figures.
12.10.2011 © Finpro 48

49. Basic corporate hardware
Entreprises du Kompass
Companies with an Internet connection (in %) Entreprises du Kompass
Computers / employee ratio
100 90 91
88 88
90 0,60
0,48 0,50
80 0,50
70 0,40
0,37
0,40
60
%
50 0,30
40
0,20
30
20 0,10
10 0,00
0 2004 2005 2006 2007
2004 2005 2006 2007
Répartition par secteurs
Connected companies per sector (in %) Computers /Répartition par secteurs per sector
employee ratio
100 96
88 90 1,00 0,90
90 80 0,90
80 0,80
70 0,70
0,56
60 0,60
0,50
%
50 0,37
40
0,40
0,30
30 0,16
0,20
20 0,10
10 0,00
0 Sect.Techno.
ICT Sect. Primaire
Primary Sect. Indus/Constr.
Ind/Const Sect. Serv./Transp.
Service
Sect.Techno. Sect. Primaire Sect. Indus/Constr. Sect. Serv./Transp.
ICT Primary Ind/Const Service
Source: Apebi Survey, 2008.
12.10.2011 © Finpro 49

50. Basic corporate solutions
Companies with an intranet Companies with a website (in
(in %) %)
per sector per sector
39 % 49 %
35 %
21 % 28 %
14 % 15 % 19 %
ICT Primary Ind/Const Service ICT Primary Ind/Const Service
Source: Apebi Survey, 2008.
12.10.2011 © Finpro 50

51. e-Commerce
Companies buying online (in Companies selling online (in
%) %)
per sector per sector
12 % 5%
4%
8%
7% 3%
5%
0%
ICT Primary Ind/Const Service ICT Primary Ind/Const Service
Source: Apebi Survey, 2008.
12.10.2011 © Finpro 51

52. Morocco
Morocco in brief
Market characteristics
Ecosystem & main players
Business models
Tunisia

53. ICT professional associations
• APEBI
• Federation set up in 1989
• 340 members representing more than 90% of Moroccan ICT sector
• Oldest and most powerful ICT federation in Maghreb
• Works with the government which contributes to its budget
• Since 2009 has organized every year a professional fair called Mitex (Maghreb IT
Expo)
• Designed as a deal-making event with workshop and meetings for decision makers
• Next edition in February 2011 focused on the following themes: e-cities, infrastructure, software
development, cloud computing, e-health and energy
• Can organize meetings for Finnish IT companies if there is a local interest
12.10.2011 © Finpro 53

54. ICT professional associations
• AMECSEL
• Association set up in September 2009 to promote the development of e-commerce
in Morocco
• 40 members
• Organizes promotional events in the country to inform local companies about the
interest of e-commerce
• Received subsidies from the Canadian state organization CIDE provide e-business
specific trainings in Morocco
• Can also arrange meetings for Finnish companies
12.10.2011 © Finpro 54

55. Telecom market
• 2nd largest market in Africa for telecoms
• 5% average annual growth over the past 10 years
• 9,6% growth expected for 2010
• French companies in 2 of the 3 local telecom operators
• Former state-owned monopoly and market leader Maroc Telecom (MT) is controlled
by Vivendi
• France Telecom acquired in September 2010 40% of the 2 nd largest operator, Meditel
• Mobile penetration rate expected to reach 100% by 2011
• Current market penetration around 97
• Fierce competition for mobile clients
• Inwi (Wana) gained1,5 million clients between June and September 2010
• Aggressive pricing strategies have led to a drop in the average revenue per user, but
gross margins remain comfortable (57% for MT and 43% for Meditel)
• MT international mobile subsidiaries are now growing faster
• The Internet market is still up for grabs
• MT is the leading broadband provider, with Wana far behind
• But 3G-based offers appear better suited for a large scale development
Telecom marketTelecom marketTelecom market.
12.10.2011 © Finpro 55

56. Telecom operators
Maroc Télécom Meditel Inwi (Wana)
Activities Mobile, fixed line, Mobile, fixed line Mobile, fixed line,
broadband internet broadband internet
Market share 55% (mobile) 35%(mobile) 10% (mobile)
43,42% (fixed) 0,24% (fixed) 56,35% (fixed)
80% (ADSL) 21% (3G) 20% (ADSL)
36,3% (3G) 42,7% (3G)
Number of mobile 24 million 10,7 million 1 million
clients
Net revenue 1 400 M€ 465 M€ 143 M€
(in 2009)
Revenue per 9€ 5,2 € 9,8 €
mobile user
(monthly)
Ownership Vivendi (53%), State (30%), France Télécom (40%), ONA Groupe (69%), Zain
Free float(17%) Financecom, RMA Watanya and Aijal Holding from
and Fipar Holding from Kuwait (31%)
Morocco (32,18%), Caisse
des Dépôts et de Gestion
(27,82%)
Source: Les Echos, 11.2010 (Sept. figures); Corporate websites.
12.10.2011 © Finpro 56

57. IT solutions market
• Today’s leading IT solution providers in Morocco have emerged from the needs of the local
subsidiaries of French IT companies
• Nearshore outsourcing started 15 years ago with call centers, then continued with ITO
and now moves towards BPO
• Local IT skills have progressed along the way
• Leading local players have built strong competences in secured data transfer
• All are SME with less than 250 employees set up more than 10 years ago
• Software editors are also consultants and integrators
• Outsourcing and e-government projects represent the majority of the demand
• Development of new techno-centers further boosts demand
• Government keeps on investing in e-administration projects
• Local SME have a priority access to these projects
• Tax and social security declarations can already be made online
• Projects from telecom operators, banks and tourism sector make the rest of the demand
• Local SME lack the resources and the skills to equip themselves
• Maroc Numeric Plan has a 10 M€ budget to subsidize IT equipments for SME (for both hardware
and software, mainly ERP)
Source: Apebi, Amecsel and Casanearshore interviews
12.10.2011 © Finpro 57

58. IT solutions market
• For foreign IT service and system integrators, 70% of their turnover comes from export and
30% from projects in Morocco
• As most of these foreign companies are French, France and French speaking countries
are the main clients
• Spain is also covered, mainly from Tangier area
• French-speaking African countries are becoming important clients as well
• Morocco has signed cooperation agreements with many Sub-Saharan countries to create free
trade zones and student exchange programs
• Morocco thus positions itself as the gateway to Africa for European companies
• In general, open-source based solutions are favored in Morocco
• Emergence of a demand for smartphone applications
• With the arrival of smartphones on the market large companies become more interested
in developing their own applications
• Banks, airlines and media are the main clients
• There are 2 local companies on this embryonic market
• Media Mobility, that also provides a solution to easily develop an application
• MobiBlanc, that mostly focuses on the offshore markets
• In Morocco, the development of an application takes 2 months and costs around 9 000 €
Source: Apebi, Amecsel, Media Mobility interviews
12.10.2011 © Finpro 58

59. Key IT solution providers
Profile Expertise HQ Exports
Infrastructure & Networks,
Integration, Payment Systems &
Finatech Casa Nearshore Yes
consulting Security, Services &
Offshore activities
Software,
Electronic payment
HPS integration, Casa Nearshore Yes
systems
consulting
ERP for finance, real
Software,
estate, utility and telecom
Involys integration, Casablanca Yes
sectors with a focus on
consulting
portable devices
Software,
Secure e-transactions
M2M integration, Casablanca Yes
solutions
consulting
Integration,
Omnidata Generalist Casablanca No
consulting
Integration, Secure communication
Sigmatel Casablanca No
consulting infrastructure
Source: Corporate websites
12.10.2011 © Finpro 59

60. e-Commerce
• e-commerce represents nearly 30 M€ in 2010
• In 2008 it barely reached 3 M€
• Most of the transactions are done in 3 sectors
• Telecom (Maroc Telecom and Meditel offer the possibility to recharge pre-paid lines and
pay bills online)
• Online flight bookings (85% paid by credit card)
• Utility (water and electricity company Lydec to manage and pay for services online)
• There are between 160 and 450 e-commerce sites in Morocco
• The 160 are those using the only local online payment platform, Maroc Télécommerce
(MTC), and accept credit card payments
• The others use other payment solutions such as PayPal, bank transfer or cash payment
on delivery
• MTC has a de facto monopoly as the only online payment platform for Moroccan website
• Set up by the leading private banks in Morocco
• According to Amecsel there would be room for another platform
• The main difficulties faced by e-commerce come from the local logistics, still dominated by
the informal sector
Source: Amecsel interview
12.10.2011 © Finpro 60

61. Hardware
• Morocco is not a cheap mass-manufacturing site of IT hardware
• It focuses on high-end, high value added components
• The country hosts manufacturing sites of leading aerospace multinationals
• EADS, Boeing, Zodiac Aerospace and Safran Engineering
• For future development, the country targets few niche markets where it has some
experience and qualified personnel
• High value added electronic components
• Onboard aerospace equipments
• Nemotek illustrates Morocco’s plan to develop its own players
• Nemotek Technologies was set up in 2008 in Rabat Technopolis Park, with funds from the State’s
investment bank Caisse de Dépôt et de Gestion (CDG)
• It manufactures customized wafer-level cameras for portable applications
• Its facilities include the first certified Class 10 clean room in Africa
• Disway is the largest importer of components and software
• Turnover of 152 M€ in 2009
• 240 employees
• Offices in Casablanca, Rabat, Agadir and Tunis
12.10.2011 © Finpro 61

62. International players
• Finatech
• Offices in Paris, Los Angeles and Dubai
• HPS
• Office in Dubai
• Involys
• Office in Tunis, partnership with the Romanian company Siveco in Central Europe
• Maroc Telecom
• Majority shares in telecom operators in Mauritania, Burkina Faso, Gabon and Mali
• M2M Group
• Offices in Paris, Cairo, Dubai and partners around the globe
12.10.2011 © Finpro 62

63. Media
• Television is still monopolized by the state
• Société Nationale de Radiodiffusion et de Télévision (SNRT) dominates the two
local television networks
• The most popular channels are 2M (SNRT channel with a 32,2% audience share),
Al Aoula (18,8%) and Al Jazeera (7,8%)
• Satellite television is widespread (66,2% penetration) and challenges the state
broadcasting monopoly
• Competitive international channels offering high-quality television produced with
greater budgets
• Radio is a more dynamic segment with some thriving private stations
• 7 new private licenses in 2007 and 4 more in 2009
• The private stations have quickly become popular as the audiences have begun to
have higher standards for radio programs
Sources: OBG The Report 2009
12.10.2011 © Finpro 63

64. Media
• The market for written press is growing and becoming more diverse
• There are currently 59 publications in (Arabic and French)
• However, only 1% of the population reads newspapers (partly due to high illiteracy)
• The leading privately owned newspapers are Le Matin, L’Economiste, L’Opinion,
Aujourd’hui Le Maroc and Bayane al-Yaoume
• Growing audience of local websites still lag behind international domains
• Leading websites include local newspapers’ and discussion forums like
yabiladi.com and emarrakesh.info
• French video sharing site Dailymotion.com launched its .ma domain in October
2010
• The Higher Authority for Audiovisual Communication monitors the media and media
freedom is still a challenge
Sources: OBG The Report 2009
12.10.2011 © Finpro 64

65. Advertising
• Total advertising spending in Morocco was €378m in 2008
• The country accounts for 62,6% of all the ad spending in Maghreb
• But low per capita spending by international standards ($17,70 per capita in 2008)
• Maroc Pub Media (MPM) manages all advertising for the state-owned broadcasting company
SNRT
• Television is the most important advertising medium although its market
share is in decline
• Accounted for 47% of spending in 2008 against 60,5% in 2006
• Radio advertising has experienced growth since the granting of private
radio licenses
• An important medium for SME’s and local firms
• The biggest ad spenders are the three telecoms companies, followed by
international retail and food companies
• Maroc Télécom’s ad spending was $55.1m, whereas the largest non-
telecoms company was P&G with $15.3m spent (2008)
• Advertising companies in the country include local companies and branches
of international ad giants such as JWT and Leo Brunett
Sources: OBG The Report 2009
12.10.2011 © Finpro 65

66. Advertising
Advertising revenues per medium
Radio
11 %
Outdoor
20 % TV
47 %
Sources: OBG The Report 2009
Press
22 %
12.10.2011 © Finpro 66

67. Advertising: Internet
• Internet advertising has not yet been able to grow to match the more traditional
advertising channels
• In 2008 it earned €3.15m in revenues
• Its share of ad spending is considerably lower than the global average
• Due to relatively low Internet connectivity only the most popular websites are
profitable platforms for advertising (Google, Youtube, Yahoo..)
• However, the Internet does have growth potential as an advertising media
• Revenues more than doubled between 2007 and 2008
• The number of households having a PC and an Internet connection seems to
increase during the next 5 years, so as to make Internet a competitive media
• Over 50% of the country’s population is less than 25 years old, and thus Internet
has potential to reach a considerable youth demographic
Sources: OBG The Report 2009, www.developingtelecoms.com
12.10.2011 © Finpro 67

68. Advertising: Internet
• AdWebMaroc is the first and leading Moroccan Internet advertising agency
• Got the exclusivity of ad management for the Moroccan version of the video
sharing site Dailymotion.com
• Wana, BMCE Bank, Nokia and Méditel are the biggest Internet advertisers
• Advertisement targeting Moroccans on global websites such as Facebook
• Mobile application use and SMS advertising have experienced growth
• Mobile numbers are public which facilitates SMS advertising
• 54% of the country’s 1m Internet subscriptions are for mobile Internet
• Mobile applications are emerging
• E.g. Maroc Telecom launched MobiCash, a mobile banking service in 2010
Sources: OBG The Report 2009, www.developingtelecoms.com
12.10.2011 © Finpro 68

69. Movie industry
• Ouarzazate is a noted filmmaking site in Morocco
• Has been a filmmaking location already for 50 years, most notably for many Hollywood
feature films
• In 2009, 862 filming licenses were sold to Moroccan filmmakers and 545 to foreigners
(out of which 17 were feature films)
• A hub of filmmaking-related activities has developed in the area
• The film-industry is the town’s main employer
• Pre- and postproduction diversified services are offered
• A number of film schools are situated in the area
• Investments aimed at making Ouarzazate a competitive international filmmaking location
• A willingness to offer an experience similar to e.g. Warner Brother Studios in Hollywood
• Government will invest 4,3 M€ by 2016
• Plans to expand yearly production of feature films to 38 per year
• This would translate into 8 000 more jobs and a yearly revenue of €180 million
• The plans include equipping the area with transportation, health care services,
conference facilities and lodging for crews
Sources: Moroccan Cinema Center, http://www.journeybeyondtravel.com
12.10.2011 © Finpro 69

70. Morocco
Morocco in brief
Market characteristics
Ecosystem & main players
Business models

71. From Call Centers to BPO
• Nearshoring of French companies to Morocco started in 1990s with the set up of
call centers
• There are now around 185 call centers for French and Spanish markets
• Major telemarketing companies have established centers such as:
• Sitel
• Teleperformance
• WebHelp
• ITO started 10 years ago
• Large IT Consulting companies have outsourced some software development and maintenance activities, like:
• Atos Origin
• Accenture
• CapGemini
• GFI
• Now development of BPO (human resources in particular)
• Early in 2010 the government adopted a new legislation to enable BPO
• Essentially about data confidentiality
• A regulatory body is being established to enforce the legislation
• Plans to develop outsourcing services in Italian, German and English
Source: MEDZ interview
12.10.2011 © Finpro 71

72. Business parks
• 4 business parks host nearshoring activities
• Rabat Technopolis is operational but isn’t completed yet
• 5th business park is being built in Fez
• Another project planned in Marrakech
• All business parks are developed and managed by state-controlled organizations
• Caisse de Dépôt et de Gestion, through its subsidiary MEDZ is the most important,
financing all projects except in Tangier
• Tanger Free Zone is managed by TMSA, the state organization in charge of the entire Tangier harbor area
project
• Casanearshore is the only park focused exclusively on nearshoring activities (ITO and
BPO)
• Tanger’s focus is nearshoring to Spain
• Technopolis’ focus is R&D
Source: MEDZ interview
12.10.2011 © Finpro 72

73. Business opportunities
• As the activities carried out are becoming more advanced, diverse and complex so do
the needs
• Local demand for Infrastructure & networks management solutions, ERP and CRM
is bound to rise along with nearshoring activities
• Nearshore business parks have specific needs
• Particularly in telecom infrastructure, networks capacity and security
• Oteo (a subsidiary of Inwi) is dedicated to offshore activities companies, building
and maintaining their telecom infrastructure
• Oteo is the telecom operator serving Casaneashore
• Interest for companies operating in Southern Europe
• Tata Consulting Services established an ITO center in 2007 for its activities in
French and Spanish European countries
12.10.2011 © Finpro 73

74. Morocco SWOT
Strengths Weaknesses
• Stable and open country with pro-
• Morocco is still a developing country
business authorities
with a large share of poor, rural and
• Skilled, experienced and English-
illiterate population
speaking personnel
• Difficult access to large public projects:
• Thriving private sector with a sizable
relations and local partners are
number of SME and large corporations
necessary
as potential clients
Opportunities Threats
• State-sponsored projects and
nearshoring activities create new and
more complex needs • Increasing competition from local and
• All solutions related to data transfers foreign companies
will keep on growing
• A gateway to French-speaking African
countries
12.10.2011 © Finpro 74

75. Algeria
Algeria in brief
Market characteristics
Ecosystem & main players
Business models

76. Algeria (People's Democratic Republic of)
Population35,7 million (47% less than 25)
Area 2 381 741 km2 (2nd largest in Africa)
Capital Algiers (largest city in
Maghreb)
Languages Arabic
• (French, Berber)
Currency Algerian dinar (DZD) (1€ ≈ 100 DZD)
GDP €80 368 million (per capita €2 b520)
Main cities: Algiers (3,5 m inhabitants), Oran (0,77),
Min wage 15 000 DZD / month Constantine (0,5), Annaba (0,38), Batna (0,31)
Sources: ANDI Investir en Algérie 2010; ONS; UN
Government Presidential Republic World Population Prospects 2010. Map © CIA World
Factbook
12.10.2011 © Finpro 76

77. Economic indicators
Share of Oil & Gas sector in GDP
50,00 %
45,00 %
40,00 %
35,00 %
30,00 %
25,00 %
Sectoral distribution of active 20,00 %
population 15,00 %
10,00 %
5,00 %
13 % Agriculture 0,00 %
Industry 2001 2002 2003 2004 2005 2006 2007
13 %
Construction
56 % Tertiary
18 %
Sources: ONS; IMF 2.2010; Ministére de la
PME et de l’Artisanat; ANDI
12.10.2011 © Finpro 77

78. Economic indicators
Investment projects in 2008
(in M€)
16 000,00
14 000,00
12 000,00
10 000,00
8 000,00
6 000,00
4 000,00
2 000,00
0,00
Domestic FDI Foreign and domestic
joint-venture
Sources: ONS; IMF 2.2010; Ministére de la PME et de l’Artisanat; ANDI
12.10.2011 © Finpro 78

79. Trade
• 2009 trade balance surplus was 88% lower than in 2008
• Exports represented 112% of imports while they reached 201% in 2008
• Oil & gas represented 97,6% of Algerian exports
• Hydrocarbon exports fell by 44%
• Other products exports fell by 46%
• Mostly half-finished chemical products and raw materials
• The 15% increase in capital goods imports offset the drop from other imports
• Cereals, metal parts for construction, vehicles and medicines are the most
imported product groups, representing almost 30% of imports
Sources: CNIS, Statistiques du Commerce Exterieur de l’Algérie, 2009.
12.10.2011 © Finpro 79

80. Trade
Algerian Trade Algerian Imports
(in M€)
70 000 Capital goods
Intermediate goods
60 000
Consumer goods
50 000
Food
40 000
30 000
2008
20 000 2009 15 %
10 000 39 %
16 %
0
30 %
Sources: CNIS, Statistiques du Commerce
Exterieur de l’Algérie, 2009.
12.10.2011 © Finpro 80

81. Trading partners
• EU countries absorbed 53,4% of Algerian exports, and supplied 52,8% of its imports
• Other OECD countries represent 31,5% of Algerian exports and 16,3% if imports
• Finnish exports to Algeria reached 108 M€ in 2009
• Represents 0,2% of total Finnish exports and 0,003% of Algerian imports
• 60% of Finnish exports were wood, pulp and paper; boilers and generators 23%; Electric machines and
devices 14%
• Imports were 139 000 €
Sources: CNIS, Statistiques du Commerce Exterieur de l’Algérie, 2009. Tulli.
12.10.2011 © Finpro 81

82. Trading partners
Algeria Main Clients Algeria Main Suppliers
USA France China
21 % 16 % 12 %
Others
36 %
Others
48 %
Italy Italy
NL 14 % 9%
6% Spain Germa Spain
France 8%
12 % ny
11 %
7%
Sources: CNIS, Statistiques du Commerce
Exterieur de l’Algérie, 2009. Tulli.
12.10.2011 © Finpro 82