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MOROCCO - INTRODUCTION 
There’s more of Morocco than meets the eye


Morocco has seen the possibilities of close ties with America for as long as there has been a United States. After all, Sultan Mohammed III was the first foreign ruler to recognize the new republic in 1777, and signed a Treaty of Friendship – the oldest U.S. friendship treaty that is still in force – with Thomas Jefferson and John Adams in 1786. Now that the U.S.-Morocco Free Trade Agreement has doubled trade between the two countries in just two years, Americans are taking a closer look at their old friend across the Atlantic.

Since ascending to the throne in 1999, King Mohammed VI has introduced free elections and overhauled political and economic governance in order to, as he puts it, “make the country’s system of government a civic-minded monarchy, through concrete accomplishments in the fields of democracy and development.” Foreign direct investment is already responding positively to the changes in the business climate, increasing by 78.6% to top $5.2 billion in 2007.

Economic liberalization is changing how Morocco does business in it new growth sectors and well-established industries alike. Take tourism, a sector where Morocco makes a big first impression. 7.5 million tourists visited in 2007, putting the kingdom on track to reach ten million visitors in 2010, up 12.9% over the previous year. Not only are more visitors coming to Morocco but they’re spending more when they get there, helping boost tourist revenue by 13.4%. The hotel industry is already aware of Morocco’s tourist appeal, with InterContinental Hotels & Resorts announcing plans to build a 180-room hotel and luxury spa ten minutes from downtown Marrakech. And once tourists get to Morocco, they’ll soon have an easier way to get around the country. By 2013, the initial $2.8-billion line of Africa’s first high-speed rail system will use state-of-the-art TGV technology to whisk passengers from Tangier to Casablanca in 2 hours and 10 minutes.

King Mohammed VI introduced free elections and overhauled political and economic governance

Tourism seems too glamorous for you? Take a look at phosphates, then, a sector where Morocco is a leader in turning its phosphate resources into chemicals and fertilizers that are in demand around the globe. The Jorf Lasfar Phosphate Hub outside Casablanca churns out 2.5 million tons of fertilizer every year, and now that the 4,200-acre industrial complex is open to foreign investment the state-owned Office Chérifien des Phosphates wants to raise annual output to ten million tons by 2010. The world has a growing appetite for phosphates, and Morocco has 1.2 trillion cubic feet of them, with phosphoric acid exports increasing by 13.1%, and phosphates up 18.9%, in 2007.

Growing food is a growing business in Morocco, and the agriculture sector is the focus of new policies to enhance the kingdom’s ability to compete in world markets. A new Green Morocco Plan is transforming agriculture through a series of public-private agreements to upgrade expertise in key sub-sectors and improve development finance for small farms. The work that Morocco has already accomplished to boost agricultural productivity is helping the country face the challenges posed by skyrocketing energy costs. Former IMF Director Michel Camdessus confirms that Morocco is reaping in benefits after almost a decade of sweeping reforms, saying that the current economic challenges “would have been difficult to overcome had these works not been achieved”.

What’s even more impressive is that Morocco is showing the most robust growth in new sectors beyond its traditional areas of strength. King Mohammed VI calls for Moroccans to start branching out to invest “in fields with a promising potential, in high value added sectors, in the knowledge-based economy and in state-of-the-art technology”. The potential of these new sectors promises to make growth stronger and less volatile, and when you take agriculture out of the equation, Morocco enjoyed a stable 5% increase in GDP last year. Indeed, economic diversification started to bear fruit across the board in 2007: Morocco saw a 12.6% increase in sales of cement, 4.5% increase in manufacturing, and a 25.1% increase in cell phone subscriptions, all showing the way that new economic dynamism is changing life in the kingdom.