Casablanca Finance City Aims for Growth Despite EU Tax Concerns and Pandemic Challenges

After ten years of existence of Casablanca Finance City, the CEO, Said Ibrahimi, does not hide his pride, thanks to the 200 CFC-labeled companies, proving that Casablanca Finance City has achieved its objective, that is to say, to attract capital and support these economic and financial players for their development in Africa, writes Jeune Afrique. But this momentum of CFC quickly fell due to the European Union, which qualified the fiscal "package" offered by the CFC to foreign companies as a "harmful practice", thus placing Morocco on the "watch list" on tax havens or gray list it established in 2017.

The European Union emphasized the difference in taxation between production for export and production for the local market. Thus, to fall in line, CFC has implemented two reforms of its tax regime, including a uniform regime with a single rate of 15%. However, the old tax regime is still valid for two more years. In addition, on October 1, 2020, a decree-law reorganizing CFC was passed. "It has allowed us on the one hand to better define our categories of companies and to expand the eligible activities for the status," said Said Ibrahimi, stressing that thus, six new activities can apply for the status. These include investment companies, CIS (Collective Investment Schemes), IFCs (Investment Firm Consultants), crowdfunding companies/platforms, trading companies and regional headquarters that can invoice goods and services intra and extra group.

However, although the CEO of CFC remains hopeful, Casablanca Finance City has already lost its first advantage of seducing operators, due to the European decision that has slowed down its recruitment pace, not to mention that the health crisis has also impacted the activities of the CFC. In view of these problems, to reach the 40 to 50 companies in 2021, as the CEO envisions, CFC must surpass itself by integrating the top 25 or 20 of the Global Financial Centres Index to regain the confidence of operators. But the initial objective of reaching 500 members by 2025 is far from being won.