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COUNTRY NAME: Kingdom of Morocco
LAND AREA: 446,000 km2
POPULATION: 31,6 million (2010 est.)
LANGUAGE: Arabic (official), French
CURRENCY: 1 Moroccan Dirham (MAD) = 100 Santimat; 1 EUR = 11.15 MAD (Nov. 2010)
MAIN CITIES: Rabat (Capital), Casablanca, Fes, Marrakech, Meknes, Oujda, Agadir, Tangier, Tetouan, Laâyoune
NATIONAL DAY: 30 July
TIME ZONE: Standard Time is GMT + 0
Morocco managed to resist the direct effects of the global financial crisis through solid fundamentals and structural reforms, as well as its sound banking and financial system and efficient exchange rate regime. Nonetheless, given its open economy, Morocco has felt the impact of the economic downturn on those productive sectors that are most dependent on foreign markets, particularly Europe, the country’s main trading partner. In response, the country implemented a number of measures under the 2009 Finance Act to bolster domestic demand and investment and to support the sectors worst hit by the global crisis, while establishing mechanisms to monitor the results of the measures taken.
Foreign Direct Investment has increased substantially in recent years; from an average of only $80 million in the 1980s to $500mn in the 1990s, it reached $3.5bn in 2008. As a liberal economy, Morocco has long been open to foreign investors and adopted reforms including privatisation much earlier than many other countries. Foreign investors are able to own 100% of their businesses, land and properties without any need for a local partner. The economy has been boosted in recent years by growing consumer spending and inward investment which has been underpinned by state-backed infrastructure projects and tourism. Domestic demand is seen growing by 5.9%, down from 10%. Growth in 2008 was 5.6%. The HCP saw 2010 growth at 2.4%, although much depends on volatile farm yields.
Highlights
Seven priority industrial sectors have been targeted by Morocco for development to boost the country’s exports, the country’s Ministry Industry, Trade and New Technologies has announced. The sectors comprise four new and three traditional ones: automotives, aerospace, electronics and offshoring were the new sectors offering opportunities, while agro-foods, seafood and textiles were the traditional sectors to be upgraded. But all these sectors equally possess great potential for development with thehelp of investors and partners. The kingdom is the world’s largest exporter of phosphates, a sector being developed by state company Office Cherifien des Phosphates (OCP). A number of international companies have signed partnerships with OCP. A new port at Tangier, being developed by the Tangier-Mediterranean Special Agency, is set to be one of the largest deep-water ports in the Mediterranean. A second terminal, due to be operational in 2012, will increase the port’s container capacity from 3.5 million twenty-foot equivalent units (TEU) to 8.5 million TEU. The scheme is being accompanied by major infrastructure projects in the area and is designed to promote regional development. An integrated transport network, including new road and rail networks, is set to cost $5-6 billion. Morocco is also becoming a centre for offshoring, with its existing flagship offshoring zone, CasaNearshore, to be followed by others in Rabat, Fez and Marrakech.
Banking
Morocco’s banking sector, like banking throughout Africa, has not suffered as much as financial sectors in other parts of the world, an international conference in Dar es Salaam, Tanzania held on 10-11 March 2009 was told. In Morocco, net profits in the banking sector was expected to grow at around 15% in 2009, Mohamed Benchaaboun, CEO of Morocco’s Banque Centrale Populaire, estimated. But while the financial sector may have escaped the turmoil, the continent is feeling the impact of the global recession. In Morocco, Benchaaboun said, the recession was slowing demand in such vital sectors as tourism and remittances were also falling. The strength of the banking and financial sector has been improved by the success of Morocco’s economic reform programme since the turn of the century which has substantially strengthened macroeconomic conditions and accelerated the pace of non-agricultural growth. Increases in tourism and remittance receipts, coupled with higher capital inflows, have sustained current account surpluses for most of the period, and boosted domestic liquidity. In contrast with what happened in other regions of the world, these developments did not fuel a credit boom, an IMF working paper observed. During the first half of the current decade, the expansion of the banking sector’s balance sheet did not translate into a significant increase in credit to the economy. Its ratio to GDP remained basically fl at between 2000 and 2006; in fact, the share of the banking sector’s total assets to credit to the private sector fell by 3 points during this period. The most plausible explanation for this lies in the structure of the Moroccan credit market, the IMF said. On the supply side, bank credit is highly concentrated with limited competition, with the three largest banks accounting for roughly 60% of outstanding credit to the private sector in 2007.
Tourism
The tourism ministry forecasted a record number of foreign tourists in 2009 but expected that they would spend less than in previous years. Tourism attracts more investment than any other sector into the country and contributes around 7% to the GDP annually, so the government has been taking proactive measures to ensure that this momentum continues through the global downturn. With tourist receipts decreasing 3.5%, from Dh58.67bn (€5.33bn) in 2007 to Dh56.59bn (€5.14bn) in 008, internet marketing is being used more actively to expand the arrivals base beyond the traditional European markets with a focus on attracting tourists from Eastern Europe, Russia, the Gulf and China. Marrakech, Fez, Casablanca and Agadir have been selected as priority regions for the expansion of highend cultural and beach tourism. Tourism initiatives also include Plan Azur, Plan Biladi and Plan Madain which are aimed at developing resorts, bolster domestic tourism and showcase cultural destinations. Plan Azur is expected to be the linchpin of the three, as Morocco looks to capture some of the lucrative regional resort market. As part of the Azur Plan, a 12 billion dirhams ($1.5bn) Mediterranean coastal resort was unveiled in June. The Saidia Mediterrania resort, inaugurated by King Mohammed VI, covers 696 hectares and will ultimately have a capacity of 30,000 beds, and generate 8,000 direct jobs and 40,000 indirect ones by 2013. The resort includes nine top hotels, 12 holiday villages, eight tourist complexes, 2,700 apartments, 300 villas, three 18-hole golf courses, a marina with 1,350 berths for boats, and a 43,000-sq m “Médina Center” Mall that can host up to 160 shops. Plan Azur aims to create new tourist destinations on the Mediterranean and the Atlantic coasts. Meanwhile, Morocco has been granted a €240m ($310m) loan from the African Development Bank (ADB) to assist in the upgrading of facilities at five of its largest international airports: Casablanca, Rabat, Marrakech, Agadir and Fez. In 2007, the five airports handled 91% of the country’s total annual passenger traffic, comprising about 12 million people. The total cost of the airport redevelopment plans is estimated at €320m. A new low-cost airline, Air Arabia Maroc, started operations on 6 May 2009 with an inaugural flight to Stansted Airport in London. The new Moroccan airline, flying to selected destinations across Europe and North Africa, was founded by Air Arabia, one of the first low cost airlines in the region, in partnership with Regional Air Lines, a leading private carrier in Morocco and Ithmaar Bank of Bahrain.
Infrastructure
Morocco is speeding up investment on infrastructure projects such as roads, highways, new railway lines and the important Tanger Med Port complex, which will be the biggest port in Africa. Social housing is another key ambition with new urban areas planned. The Union for the Mediterranean launched a new regional infrastructure development fund, Inframed, at its meeting in Alexandria, Egypt on 30 April 2009. The initiative established a regional framework for public private partnerships to aid the development of infrastructure across the region and will participate in financing energy efficiency, transportation, environmental and urban development projects. The union aims to raise more than €1bn ($1.3bn) in equity capital for the new fund which is led by France’s Caisse de Depots, Italy’s Cassa depositi e prestiti, Morocco’s Caisse de Depot et de Gestion, and Cairo-based investment bank EFG-Hermes. The four institutions jointly committed €400m to the project. Morocco has put in place plans to develop the real estate sector and attract investment into the property market the plans include the building of up to 200,000 new housing units and the creation of three new cities on an overall land area of 1,643 ha near the provinces of Agadir, Settat and Nador.
Agriculture
The performance of the agricultural sector has been strong of late with good harvest boosted by heavy rainfall. In January 2009 it was announced that the Plan Maroc Vert (Green Morocco), a programme to upgrade the country’s global agricultural competitiveness would receive a budget of Dh20bn (€1.8bn) for the next five years. The plan will renovate the sector through increasing investment, improving management and training, and working to provide access to water and land.
Energy Sector
News of more gas finds in Morocco kindled hopes of a new source of both energy and income for the country. In March 2009, Dana Petroleum announced a new “significant” gas discovery at Anchois, in the Tanger- Larache licence, with its first well offshore Morocco. TheAnchois-1 discovery well is located about 40 km from the coast and was drilled to a total depth of 2,435m. Preliminary estimates of reserves were said to be around 100 billion cubic feet. Earlier, Circle Oil Plc confirmed that it had found natural gas in the north-east of capital Rabat, as part of the Ouled N’Zala permit. At the same time, Tethys Oil started drilling operations at the Tafejjart-1 well on the Bouanane licence onshore Morocco. In a move to meet supply challenges, to preserve the environment, and to support sustainable development, the country launched last November the Moroccan Solar Energy Project which will be built on 5 sites. With a total investment of 9bn $, the project aims at the installation by 2020 a total capacity of 2.000 MW.
Source: Austro-Arab Trade Directory 2011.
The mentioned data are subject to modification. No responsibility is taken for the correctness of the details provided.
Last modified: 26 January 2011
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