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Morocco’s market economy expansion and its successful strategy in combatting money laundering and terrorist financing

Mohammed Ahmad Naheem (Mayfair Compliance, Frankfurt, Germany)

Journal of Money Laundering Control

ISSN: 1368-5201

Article publication date: 12 August 2020

Issue publication date: 31 July 2021

228

Abstract

Purpose

Morocco is an expanding developing economy in North Africa with increasing bilateral trade relations with larger economies. This paper aims to examine the features of the expanding market economy and the preceding structural reforms initiated by King Mohammed VI. The paper’s primary focus is to study the systematic feature of anti-money laundering and combatting of terrorist financing (AML/CTF). Morocco has emerged as a staunch opponent of terrorism and terrorist financing while garnering joint-investigative operations with European countries against transnational organised crime and money laundering.

Design/methodology/approach

The paper is divided into two primary series. The first is a view of Morocco’s economy, with a qualitative analysis of significant economic, political and social structural reforms. Second, a qualitative and quantitative analysis of Morocco’s AML and combating of terrorist financing infrastructure is assessed. The qualitative analysis is conducted in two parts; first, by studying the country’s AML/CTF legislation and regulation, and second, by examining the independent international evaluation of the legal structure and its implementation by authorities. The quantitative analysis is conducted by investigating the available statistics relating to money laundering and terrorist financing.

Findings

The paper finds Morocco to have accomplished essential economic reforms, especially considering greater institutional management and autonomy. Other structural reforms include the reformation of the constitution, a more comfortable business climate, social development projects focusing on enhancing skill labour and connectivity and the development of strong trade capacity. The primary objective discovery concerns the country’s AML/CTF structure, which is found to comply with international standards. Also, efforts enhancing the country’s regulatory environment with low corruption, low risk of money laundering and low risk of terrorist financing have been taken in a series of legislative amendments and programs. The banking sector and Morocco’s Customs agency have reflected the best improvement as per the study in this paper.

Practical implications

Morocco is witnessing high levels of investment, with year-on-year growth in most existing industrial sectors. The market is also providing for new skilled labour and better trade incentives with the European Union. It is essential for investors, observers and policymakers to understand the market economy reforms and systematic deficiencies in a developing economy. Morocco presents observers with information about policies pre-reform, providing a guide for economic and AML/CTF policy implementation elsewhere.

Originality/value

The paper concerns itself with two levels of analysis concerning Morocco. The first, broad study, is a review of market economy reforms, which are mostly structural and have assisted in the expansion of the economy greatly. The second objective is specific to examining the country’s AML/CTF structure, which has undergone significant development in legislation, regulation and implementation in the past decade. The paper makes a specific attempt to discuss associate indicators to the AML/CTF network as a part of this study.

Keywords

Acknowledgements

The author acknowledges being the recipient of a research grant awarded by Princess Ālae as part of Seven Foundation’s “2020 Banking Vision – building banks of the future” and he thanks her for the continued support and motivation both to himself and other students who benefit through her generosity. The author also thanks Professor Muhammad Jum`ah (a leading economist of this era based in Damascus), who has continued to provide valuable input both through his teaching of the science of economics and for his continued guidance.

Please note that this paper was composed and submitted for review to this journal in April 2019 – All the content was current at that point in time. The banking, compliance and regulation industries alongside governmental policymaking evolve over time, with new material from academic research emerging. These points need to be taken into consideration when reading this paper.

The author is a specialist researcher and practitioner in contract with Mayfair Compliance. (www.mayfaircompliance.com).

Citation

Naheem, M.A. (2021), "Morocco’s market economy expansion and its successful strategy in combatting money laundering and terrorist financing", Journal of Money Laundering Control, Vol. 24 No. 2, pp. 325-347. https://doi.org/10.1108/JMLC-06-2020-0068

Publisher

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Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

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