| COUNTRY PERSPECTIVES
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MOROCCO |
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Business opportunities & territorial marketing |
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The range of sectors of interest to investors has expanded from the traditional (energy, textiles, fishing, and agriculture) to those presenting greater added value (such as infrastructure, transport, telecommunications, financial services and others). |
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Morocco |
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Morocco |
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Introduction |
The privatisation programme launched in 1993 succeeded in attracting a significant level of FDI inflows to the Kingdom. From 1993 to 2003, some 66 entities were transferred to the private sector, generating MAD 54.7 billion (EUR 5.4 billion) in income from privatisation, of which 82.7 percent were foreign investments. Privatisation is of three kinds: tendering (76 percent of the receipts), public offers on the Casablanca Stock Exchange (6.5 percent), and direct attribution (17.4 percent). Morocco is also contracting out certain public utilities to the private sector. The public utilities covered by this new policy include electricity distribution, drinking water supply, sewage treatment and solid waste management, urban public transport, street lighting, and the management of public gardens and parks. |
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Transport |
The country has a network of more than 500 km of highways and 11,000 km of national roads. The government needs to invest 2.2 billion Euros to upgrade road infrastructure in the framework of the second national programme to build rural roads (PNRR-2). PNRR-2, which seeks to provide transport for some three million people at a rate of 300,000 a year, targets the construction and improvement of 15,500 km of roads between 2005 and 2015. The first National Programme of Rural Roads (PNRR-1) was launched by the Moroccan government in 1995, programming action that has become necessary to meet the challenges facing the Moroccan road network, including under-development, limited rural accessibility, weak maintenance, and severe weather conditions.
In addition, the programme plans to upgrade some 1100 km of roads, repair civil engineering structures, rebuild works, renew public works equipment, carry out technical and feasibility studies for new projects, upgrade access by road to Casablanca (increase capacity, add intersections, create underpasses, build new exchanges…). |
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Tourism |
With 5.8 million tourists in 2005 using the country’s accommodation capacity of 124,000 beds, tourism is the second source of foreign currency for the Moroccan economy.
The “Vision 2010” development strategy has been launched, with the goal of quadrupling tourist activity by the end of 2010 to 10 million tourists, doubling hotel capacity to 115,000 rooms (250,000 beds), developing seaside resorts (construction of six new world-class establishments with 160,000-bed in proximity to the country’s airports), and diversifying tourism products. A budget of EUR150 million is planned for hotel renovation. The approach adopted for creation of this additional capacity is to develop integrated tourist zones and meet new tourist demands by promoting private partnerships through tenders. |
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Construction and public works |
Prospects for construction and civil engineering are encouraging, with implementation of social housing programmes and building of basic infrastructure to mitigate the problem of urbanisation and housing deficits. The Kingdom has decided to create two new cities close to Marrakech (Tamansourt) and Rabat-Sale-Temara (Tamesna). The Ministry of Housing will carry out urban studies to review the status of real estate and arrange for off-site facilities, while private promoters will be in charge of construction (in particular at Addoha, Chaabi Liliskane and Chaima). |
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Energy and mining |
Morocco’s overall energy consumption stands at 11.4 million Mtoe, having increased by 3.3 percent per year over the period 1999-2003. It is estimated that power consumption will reach 17 million Mtoe by 2015. Morocco is strongly dependent on oil and, to a lesser extent, on coal for the production of electricity. Other sources of energy remain weak and the country depends on imported energy products for more than 85 percent of its consumption.
The national gas project intends to build a gas pipeline to tie into the Maghreb-Europe gas pipeline (GME), crossing Morocco for 540 kilometres and connecting to Algerian and Iberian networks. The first will go through Ouezzane, Mohammedia and Casablanca to Jorf Lasfar and the other will cover areas close to the GME. A tanker terminal for methane will be installed at Mohammedia and underground storage is also envisaged. The cost of this development programme is estimated at MAD 4 billion (EUR370 million). The National Hydrocarbons and Minerals Office has stepped up its promotional efforts to attract foreign investors. New agreements have been signed, increasing to 26 the number of companies prospecting for hydrocarbons in Morocco over an estimated area of 107,000 km2 offshore and 23,000 km2 onshore.
Morocco possesses 75 percent of the world's known mineable phosphate reserves. The “Office Chérifien des Phosphates” (OCP) is in charge of operating these phosphate mines, then processing, producing and marketing by-products (phosphoric acid, fertilisers…), of which it is the number one world exporter. Phosphate exports account for 17 percent of Moroccan exports and constitute an important source of foreign currency for the country.
The demand for electricity is increasing by 5 to 8 percent per year and Global Rural Electrification Programme (PERG) targets a rate of household connection at virtually 100 percent by the end of the decade. The National Electricity Board (ONE) has launched an ambitious investment programme (MAD 11.32 billion invested between 1999 and 2003) to carry out a large number of initiatives such as the Tahaddart power station (MAD 2.4 billion), doubling of transit capacity to and from Spain (MAD 1.34 billion), strengthening of the network with a new sub station (MAD 1.13 billion) and construction by Alstom Power of a STEP (transfer of energy per pumping station) facility at Afourer (MAD 1.7 billion). |
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Water |
The availability of water in Morocco is very uneven from one area to another, ranging from the relatively favoured north-western part of the country under the influence of the Atlantic Ocean to the very arid regions of southern and eastern Morocco. Morocco’s climatic and hydrological systems are also subject to cyclical variations, generally several years of drought followed by wetter conditions.
Water resources are thus a major concern for Morocco. Nearly 90 percent of resources are already mobilised and they are being seriously degraded by domestic, industrial, and agricultural pollution. Only 5 percent of urban effluents are treated. The promulgation of ”water” law 10-95 in 1995 constitutes the starting point of a new national water policy. It addresses fundamental issues ranging from water resource planning and management, institutional reform, the transition from supply to demand management, the development of a reservoir management strategy, application of "user-pays" and “polluter-pays” practices and promotion of dialogue between users and operators in the sector. |
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Agriculture and agrifood |
Agriculture plays a major economic and social role in Morocco, largely contributing to efforts under way for several decades in the Kingdom to boost economic performance. Morocco depends heavily on its agricultural sector, which generates 15 to 20 percent of GDP (depending on the harvest) and employs some 40 percent of the labour force. More than 90 percent of the country’s crops receive no irrigation and production is very uneven. Although agriculture is so important for Morocco, only 19 percent of land area is cultivated, producing barley, corn, citrus and other fruits, wine, vegetables and cattle. Morocco is a net exporter of fish as well as fruit and vegetables, but it imports many cereals, oleaginous seeds, and sugar. |
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Retailing and modern distribution |
The market for modern organised retailing is being structured. Over the last few years, a number of modern self-service retail outlets (including convenience stores) have opened in major cities, and this trend is likely to continue. The retail food sector has progressed significantly over the past ten years, as modern, spacious supermarkets opened in major cities, increasingly changing the shopping habits of the majority of urban consumers throughout Morocco. |
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Textiles-clothing |
Textiles and clothing is a major sector for the country’s economy. It is the foremost industrial employer, providing 200,000 jobs to 40 percent of the labour force. The multifibre agreements that governed world trade in textiles and clothing for thirty years were phased out on 1 January 2005. According to a Ministry of Finance and Privatisation study entitled “what is at stake for Morocco in dismantling of the MFA”, the loss of preferential conditions enjoyed by Morocco on the European markets will exacerbate competition from Asia, but Morocco retains a number of assets: undeniable cost competitiveness for certain products; proximity (an advantage for small series, with quick turn-around time in response to tailored requests); and a reasonable degree of competitiveness comparing to Chinese similar exported products. |
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High technology industries |
The high technology sector is booming in Morocco as a result of government incentives and the decision by large international groups to set up maintenance and microelectronic component assembly operations in Morocco. This strategy is based on the availability of high-level facilities and technicians in Morocco. Sectors like electronics, in particular the production of electronic components, have high potential for exports. Mono and multi-layer printed circuits, passive and active components, converters, and telecommunications equipment are real investment opportunities, in particular in subcontracting for export. Other sectors, such as automotive industries, precision mechanics, the aeronautics industry, as well as industrial research and development are growing steadily thanks to relocation trends. The State is supporting investment in these sectors through the Hassan II Fund. |
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