Reform program in the financial and banking sector for the Republic of Tunisia 2020
According to the Board of Executive Directors’ resolution number (15) of 2020, the AMF extended a loan to the Republic of Tunisia with the amount of AAD 23.968 million (equivalent to about US$ 98 million), representing 125 per cent of the country’s share in the Fund’s paid-up capital in convertible currencies, within the framework of the Structural Adjustment Facility in the Financial and Banking Sector. The loan supported a reform program in the mentioned sector, agreed between the AMF and the Tunisian authorities, covering the period (June 2020-June 2021).
The loan was provided to support the monetary, financial, and structural reform efforts initiated by the Tunisian authorities since the beginning of 2019 in order to promote economic stability and create a favorable environment to stimulate production and drive growth. The Tunisian government's adoption of the financial and banking reform program was also aimed at strengthening the sector's prevention and strengthening its ability to cope with the repercussions of the Covid-19 pandemic on trade and the flow of foreign investment, as well as negative impacts on productive and service activities and their implications for domestic and external financial conditions.
The program was based on four pillars: promoting financial innovation, promoting financial inclusion, developing payment systems, and strengthening banking supervision and financial stability. The goal of promoting financial innovation is to strengthen the system of modern financial technologies by encouraging innovation and raising the ability of the Central Bank of Tunisia to develop the appropriate regulatory framework for these technologies, including the activation of the Committee of Modern Financial Technologies, the development of a regulatory environment system for modern financial technologies, the development of an innovation laboratory, as well as the development of a website dedicated to modern finance.
As for the pillar related to focus of promoting financial inclusion, it aimed to enhance the access of individuals and institutions to financial services and funding from banks and financial institutions, particularly digital services. While the development of payment systems has focused on increasing the efficiency of payment and settlement systems by strengthening the electronic payment system and expanding the scope and coverage of payment systems.
In the same vein, the actions focused on strengthening banking control and financial stability focused on strengthening the foundations of financial stability and adopting international standards in the field of banking and accounting control, by completing work on meeting the requirements of the Basel Committee on Banking Supervision, supporting the stability of the banking sector through the completion of the strategic project on establishing an integrated framework for macro-prudential policies, and developing key early warning indicators in the field of financial stability.
During July 2021, meetings and consultations were held with the relevant authorities of the Republic of Tunisia through visual media, where the AMF found that there was progress in implementing the elements of the program under the framework of its four main interlocutors, despite the exceptional circumstances due to the Covid-19 pandemic, and the second installment of the loan was withdrawn by 9.588 million Arab Accounting Dinars.
Reform program in the financial and banking sector for the Hashemite Kingdom of Jordan 2019
The AMF extended a loan to the Hashemite Kingdom of Jordan amounting AAD 23 million (equivalent to about US$ 96 million), within the framework of the Structural Adjustment Facility in the Financial and Banking Sector, to support a reform program in the mentioned sector covering the period (November 2018-November 2019), according to the resolution number (25) of 2018 issued by the Board of Executive Directors.
The objective of the program is to enhance financial stability factors and access to finance and financial services, and to support efforts to strengthen payment, settlement and reduction systems.
The program was based on three pillars: enhancing financial inclusion by facilitating access to finance and financial services for individuals and SMEs; strengthening the system of control and supervision of the financial and banking sector; and strengthening payment and settlement systems and supporting the application of modern financial technologies.
The goal of promoting financial inclusion by facilitating access to finance and financial services by individuals, SMEs and micro-enterprises is to increase access to finance and financial services through the implementation of a range of measures aimed at enabling all segments of society to access and benefit from financial services, particularly youth, women, entrepreneurs and vulnerable groups, to promote financial inclusion, achieve social development goals and accelerate inclusive and sustainable economic growth and create productive jobs. As for the strengthening of the system of control and supervision of the financial and banking sector, it aimed to improve the operational efficiency of the task of controlling and supervising the financial and banking sector, in line with international practices and standards in this area, by applying the concept of risk-based approach, and completing the project of automating the inspection process on banks operating in the Kingdom.
The objective of developing mechanisms and frameworks that enable the follow-up of indicators related to the health and safety of the individual and corporate sector, the level of their indebtedness, the extent of exposure of banks to them, the study of other sectoral risks, in addition to enabling the Central Bank to determine the level of potential risks more accurately, early, and identify the best and least costly ways to address them. Stimulate the shift towards digital financial and banking services, encourage the use of modern financial technologies to improve the quality and accessibility of services provided by financial institutions, employ technologies to enhance financial inclusion, meet the changing needs of banking customers across digital services, and take advantage of the role those financial technologies play in providing alternative sources of financing to small enterprises. Medium, ensuring compliance with risk management rules, facilitating foreign trade and remittances of overseas workers, reducing the cost of cross-border payments, and increasing the efficiency of government financial operations.
As it followed up on the implementation of the agreed reform program, the Fund found that the Central Bank of Jordan had made determined efforts in implementing most of the measures containing the three axes on which the reform program agreed with the Fund was based. Accordingly, the second installment of the loan of 9.2 million Arab Accounting Dinars was withdrawn.
Reform program in the financial and banking sector for the Kingdom of Morocco 2017
In 2017, the AMF extended a loan to the Kingdom of Morocco amounting AAD 69.500 million (equivalent to about US$ 293 million), representing 175 per cent of the country’s share in the Fund’s paid-up capital in convertible currencies, under the framework of the Structural Adjustment Facility in the Financial and Banking Sector. The loan supported a reform program covering the period (September 2017-September 2018). The program based on three pillars: strengthening financial coverage by facilitating the access of individuals, SMEs and micro-enterprises to finance and financial services; deepening the role of the capital market in financing the economy; and strengthening the system of controls and supervision of the financial and banking sector.
The loan to the Kingdom of Morocco was to help the Moroccan authorities face the challenges of taking appropriate measures to enhance the financial and banking sector's ability to mobilize resources and cope with shocks, by continuing reforms aimed at enhancing financial stability and access to finance and financial services and supporting efforts to deepen financial markets to meet the financing requirements for economic activities.
The goal of promoting financial inclusion by facilitating access to finance and financial services for individuals, SMEs and micro-enterprises to increase access to finance and financial services through the implementation of a range of measures aimed at enabling all segments of society to access and benefit from financial services, especially young people, women, entrepreneurs and vulnerable groups, in remote areas, to promote financial inclusion, achieve social development goals and accelerate inclusive and sustainable economic growth and create productive jobs.
As for the deepening role of the capital market in financing the economy, he focused on improving and revitalizing the market to support the finance needs of the economy, strengthen the investment environment and prepare it to attract more foreign and domestic investment that is reliable in achieving inclusive and sustainable economic growth. With regard to the strengthening of the control and supervision system in the financial and banking sector, it aimed to upgrade the control and supervision sector, and to strengthen the gains made in the framework of the reform and development of the control and supervision sector of the Bank of Morocco (Central Bank), in terms of determining the levels of risk to which banks may be exposed and detecting strong and weak sector Banking, by linking the banking sector to economic developments in a quantitative way, and working on a methodology to identify banks of systemic importance.
During 2018, the AMF's mission to the Kingdom of Morocco to determine the progress of the implementation of the program indicated that the Moroccan authorities had made progress in implementing the elements of the program, under the framework of its three main interlocutors, and the second installment of the loan of 30 million Arab Accounting Dinars was withdrawn.