According to its communication, the discreet Ithmar Capital would be very dynamic. Created in 2011 on the initiative of Yassir Zenagui, former Minister of Tourism and current Royal Advisor, the Moroccan sovereign wealth fund has presided over the International Forum of Sovereign Wealth Funds for a year and a half., a network that brings together 45 sovereign wealth funds whose assets under management would amount to 4,600 million dollars. An additional mandate to that of the presidency of the African Forum of Sovereign Wealth Funds (ASIF), a platform launched on the initiative of Ithmar Capital in June 2022.
Restore your image
In recent months, highlighting its “triple ISO certification” and a partnership agreement with the Spanish Cofides (Financial cooperative for the development of the solidarity economy), the investment vehicle managed since 2019 by Obaid Amrane has multiplied its announcements to restore your image.
Is it better to forget your balance sheet? Because, in addition to accumulating deficits since its creation, Ithmar Capital has a miserable portfolio that has not changed at all since 2015. So much so that the Ministry of Finance is now worried about its fate. Especially since the creation of the Mohammed VI Investment Fund (FM6I), a sovereign wealth fund desired by the king for private investment.
An “almost zero” achievement rate
Founded under the name of the Moroccan Fund for Tourism Development (FMDT) to contribute to the financing of strategy kingdom, the company changed its vocation in 2016 to become a sovereign wealth fund whose mission is to “promote investment in all national strategic sectors, developing structuring and transformational projects with a strong impact”.
Among the sectors targeted: industry and renewable energy. At the end of 2016, the state-owned company will sign a “strategic partnership” with its counterpart Nigeria Sovereign Investment to advance the megagas pipeline project between the two countries – the cost of which is estimated at 25 million dollars.
However, no investments were made from that date onwards in industry or energy. “Despite the expansion in 2015 of the scope of its activities to other sectors, the company has not had achievements at this level”, explains a report referring to the 2020 finance law. entirely due to lack of resources: outside of a projected investment project of little more than a billion dirhams (almost 100 million euros) in 2018, the fund yielded just 11.1 million dirhams, “that is, an almost zero installment rate of 1%”, says the Ministry of Finance document.
A portfolio of… three projects
In a 2019 interview with the Emirates newspaper national newsObaid Amrane promised, however, to drain no less than 6 billion dollars in investments by 2024. [accords potentiels] that are dedicated to industry, agriculture and some energy and renewable energy projects”, he explained.
Although Ithmar has abandoned its exclusively tourist vocation, its portfolio has remained since its creation with just three projects: Wessal Capital (20% participation in four subsidiaries for less than 100 million euros), the development and promotion company of the Taghazout resort (SAPST, a seaside resort near Agadir for less than 16 million euros), the Saidia Development Company (SDS, another seaside resort in the eastern region for 50 million euros) and Oryx Capital, a co-owned company from a Qatari fund (one million euros). Made before 2016, all these investments concern tourism projects.
never profit
Involved in essentially unfeasible seaside projects – some carried out several years late, others abandoned – the sovereign wealth fund never made the slightest profit. According to its balance sheets, it has incurred losses since its creation. For example, the company declared a deficit of 36 million dirhams in 2018. “The company's net result is still in deficit since the creation of the Fund in 2011 and is in continuous process. […] due to the non-fulfillment of the revenue, underlined the Ministry of Finance in its report.
However, the fund had a profit of 5 million dirhams in 2012 and 1.8 billion dirhams in 2020 (around 180 million euros). “The shareholder’s internal profitability rate is estimated at 6.3%”, indicates the 2011 decree authorizing the creation of the company. Those turned out to be completely wrong. When contacted, Obaid Amrane declined to answer the young Africa.
Presided until 2019 by royal advisor Yassir Zenagui, Ithmar Capital changed its governance, passing the presidency of the board of directors to the tenant of the Ministry of Finance (Nadia Fettah Alaoui). “These changes occurred with a view to supporting the expansion, decidedly in 2015, of its field of intervention at the level of the various productive sectors of the national economy in addition to tourism and defining the new positioning of the fund”, specifies the Department of Finance in its report Yearly.
The appointment in the same year of Obaid Amrane, former number 2 at the Masen agency who holds several positions in the Ministry of Finance, also did not make it possible to regularize the situation of the deficit fund.
“We shouldn’t step on each other’s toes”
“To say that Ithmar’s balance sheet is weak is an understatement. For several years, its very reason for being has been questioned,” a manager in Nadia Fettah Alaoui’s department told us. Since the effective launch of the Mohammed VI Investment Fund in December, doubts about the vocation and future of Ithmar Capital have multiplied.
Endowed with a share capital of 15 million dirhams (around 1.4 million euros), the new sovereign wealth fund – headed by former Finance Minister Mohamed Benchaâboun – defines itself as an “investment catalyst” called to channel around of 120 billion dirhams for strategic sectors, especially in industrial prevention, innovation, infrastructure, agriculture or tourism.
“As the missions of the two sovereign wealth funds may overlap, Ithmar will be called upon to disappear or be integrated into FM6I”, he confides to young Africa another source from the Department of Finance. During a press conference held in October, Nadia Fettah Alaoui asked for clarification. “In Ithmar, a situation needs much more clarity so that we don’t step on each other’s toes. I think we will let the general director specify the fund's missions”, confirmed the minister.
According to a source at Ithmar, the fund's ambition is now limited to “acting upstream of projects, working on their preparation and structuring”. Nadia Fettah Alaoui will have the last word as chairman of the board of directors of the two funds Kings.
