Mid-term evaluation of USAID/Morocco's private sector export promotion project

The evaluation covers the period 5/86-4/90. Although the overall impact on private sector exports has so far been limited, several important constraints to export expansion have been identified and addressed. As the result of project TA, the Societe Marocaine d'Assurance a l'Exportation (SMAEX) has made strong progress in increasing its export credit insurance coverage and has demonstrated its effectiveness in helping exporters obtain credit, minimize risk, and penetrate new markets. The export pre-financing credit component has had some success, but usage has been limited to only two banks (Banque Marocaine du Commerce Exterieur and Banque Centrale Populaire) and their export customers. The usefulness of the component was reduced because of the following: limited availability of dollar sums; readily available and substantial Bank al-Maghreb pre- financing facilities, which existed prior to the project; and the likelihood that demand for the USAID/M facility will decline as changes in the external environment bring about larger and more efficient production units. Marketing and production TA provided by the International Executive Service Corps (IESC) has been largely successful. Firm-specific assistance has been the most effective, while trade and investment services are also beginning to have a positive impact. Moreover, the project's requirement that TA be related only to exports has limited IESC's range of activities, slightly undermining its effectiveness. Little work has been done with firms in the service sector that could facilitate exports, or in the non-export industrial sector where foreign exchange could be conserved via import cost reductions. In addition, IESC skills and company needs were mismatched in some cases, due to language problems and the comparatively small size of Moroccan firms. Overall, the project's limited impact can be expected to increase, especially if long-term institutionalization efforts are successful. Remaining constraints include language, weak marketing skills, lack of professionalism, limited awareness of foreign buyers' needs, limited formal business education, and relatively low production capacity.