chandise export and import logistics. According to the Doing Business indicator that measures distance to the frontier in terms of the accumulation of delays and costs (excluding customs duties) associated with three categories of procedures (documentary compliance, border compliance and domestic transport), Morocco scores better than other countries in the MENA region, but not as well as its main competitors, particularly Central and Eastern Europe. Morocco was ranked 86th out of a total of 160 countries in 2016 on the Logistic Performance Index, falling 24 places from its average ranking during the period 2007-14 (World Bank 2016b). Morocco ranks well for the quality of its infrastructure but loses in this classification owing to weaknesses and dysfunctions in foreign trade services. In fact, Morocco is ranked 124th in the provision of customs services (it was ranked 73rd from 2007 to 2014) and is ranked 122nd in terms of the ability to track and trace consignments.

Other sources of market distortions are tariff and nontariff trade barriers. At 25 percent, maximum most-favored nation (MFN) tariffs on goods are still relatively high, particularly in comparison with the zero duty applied to preferential trade partners under the free trade agreements signed with the EU, the US and other countries. High duties on intermediate products tend to be an obstacle to the productivity of firms and the growth of Moroccan exports. This results from the fact that generally speaking a tax on imports ends up becoming a tax on exports, and this effect is becoming more important since the difference in export unit values between firms that both import and export and firms that export only has been increasing over time (World Bank, 2017a). Nontariff measures has a similar on resource misallocation.

# **2.2 Credit Constraints and Labor Rigidities**

The Moroccan financial system operates relatively effectively in mobilizing national savings but has more difficulty in allocating it to the most productive activities. There are many reasons for this, including objective prudential constraints related to the risk of concentration and maturity transformation and more subjective behaviors such as the reluctance and averseness of commercial banks to risk-taking. Another reason could be the still relatively low level of competition prevailing in the Moroccan banking sector (see Benazzi and Rouiessi, 2017). According to the Doing Business indicator on getting credit, Morocco is ranked 101st in the world and is relatively far from the frontier, particularly in comparison with other emerging market economies such as Romania, Cambodia or Kenya. Furthermore, even though the government recently undertook reforms to promote the diversification of financial products and mechanisms for the allocation of capital, these reforms have thus far had few concrete results and there is still a significant gap between the advanced development of the banking system and the development of the equity market. The Casablanca Stock Exchange (CSE) suffers from a lack of new issuers, particularly key large institutional issuers. Family conglomerates and medium-sized enterprises, which could develop more rapidly, generally seem reluctant to share information concerning their capital and governance. The limited convertibility of the dirham represents another source of capital 6