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Business Brief: All good news in the energy sector; Cyber-security and cloud computing ramp up services in Morocco; growth in Aquaculture by the numbers; Steel Industry Opens Global Portal – Jean R. AbiNader

Jean R. AbiNader, MATIC
September 27, 2017

Jean R. AbiNader, Exec. Dir., Moroccan American Trade and Investment Center

Jean R. AbiNader, Exec. Dir., Moroccan American Trade and Investment Center

Recognizing that solar and wind are only two components of its energy mix, Morocco presses forward on nuclear energy. A Moroccan firm is making a big splash in the region with cloud computing services while another focuses on cyber security. Latest reports project an increase in aquaculture’s growth potential.

The energy sector continues successful expansion. A close reading of Morocco’s energy strategy, beyond renewables, shows a diverse and complementary approach to meeting the country’s energy needs. As a result of around $40 billion worth of investment by 2030, 50% of Morocco will meet 50% of its demand from renewables, the balance from a mix of nuclear, coal, hydrocarbon, and other sources.

At a recent energy conference in Bahrain, Moroccan Minister of Energy Aziz Rabbah said, “The Kingdom has succeeded, through an ambitious strategy, to turn its challenges into genuine investment opportunities, through its commitment to projects aimed at developing the energy sector by 2030, 75% of which [investments] are devoted to renewable energies.”

By 2016, wind and solar energy production had already reached 30% of the country’s total energy output. In addition to energy production, Morocco is strengthening its interconnectivity to neighboring countries, most recently demonstrated by feasibility studies for reaching Portugal, an additional link with Spain, and the Trans-Africa offshore gas pipeline from Nigeria around West Africa to Morocco, linking to Europe.

LNG Gas supplies and production projects are garnering attention in the meantime, as the largest Russian energy companies, Gazprom and Novatek, are negotiating liquefied gas supply contracts with Morocco. This new thrust into the gas market in Morocco also has implications for the Morocco-Nigeria gas pipeline. Russia has extensive experience in the production and export of LNG that can be very useful to Morocco, which has the added benefit of inserting Russia into the region’s energy market.

While the size of the deals is not clear, media reports indicate that Morocco would import at least five billion cubic meters (m3) Russia once Morocco’s current agreement with Algeria ends in 2021. How this would play out with Algeria, Russia’s oldest ally in the Maghreb, is hard to tell at this point, given the uncertainty in Algeria’s energy industry. The point is that this large a deal would make Morocco a major client for the Russians. Of course, the US and Qatar are also well positioned to be players in this niche market.

Nuclear energy, meanwhile, is still on the agenda, according to reports out of the most recent conference of the IAEA. Director General of Morocco’s Center for Energy, Science, and Technology Khalid El Mediouri signed an agreement with the IAEA at the conference to expand their bilateral technical cooperation in the peaceful use of nuclear energy, including triangular cooperation with developing countries in Africa and elsewhere. Morocco has similar agreements with partner institutions in the US, France, and Hungary.

A digital hub opens in Morocco with intentions of serving a regional market. The company behind the Morocco Data Center project is Medasys Group of Medafrica System, a Moroccan company started in 1995 that specializes in highly sophisticated IT based on cloud computing. Initially designed to handle sensitive data for the Moroccan government, it has the capacity to expand its services to other West African countries.

Medasys has already formed a partnership to do that with the UK company Zircom, which specializes in the construction and operation of data centers, with the goal of building a “Morocco International Gateway Datacenter” to address both the Moroccan and African markets. At a cost of some $85 million financed by European funds, the planned mega datacenter will be five times the size of the existing Datacenter. Feasibility studies begin shortly, and the Center will be commissioned no later than spring 2019. Medasys wants to serve public organizations and private companies, including small and medium-sized firms.

Moroccan entrepreneurs are already making a name in cyber-security, as became evident when the recent epidemic of “WannaCry” virus affected more than 230,000 companies in Europe and Asia. Fortunately, since the virus was launched on a Friday, Mohamed Amine Belarbi and Mohamed Zakariae El Khdime—founders of boutique cybersecurity firm, VUL9— had the “chance to secure the frontline throughout the weekend, preparing their clients for a virus-free week ahead, according to an article in Forbes.”

Since they had already inventoried the software used by their clients, they were able to install a protective shield before anyone was targeted. “As tech guys, we are always expecting the worst-case scenario, so our minds are wired to be prepared efficiently,” explained El Khdime. El Khdime, the winner of the 2015 Hackathon for Social Good in the Arab World held at the NYU campus in Abu Dhabi, met Belarbi there; they decided to work together and immediately designed the VUL9 platform.

Having successfully held two rounds of funding, the company is poised to extend its reach beyond Morocco and the UAE. “Barely a year old, VUL9 has entered the market at a time when the growing threat of cyberattacks is causing disruption across the world on a regular basis.” According to the Forbes article, “Figures from PwC’s Global Economic Crime Survey show that in 2016 cybercrime was the second most reported economic crime that Middle East organizations fell victim to, with 30% of businesses being targeted.”  “It’s a never-ending story because no one company is immune. Everyday can bring a whole new virus we’ve never encountered before,” says Belarbi.

Aquaculture in Morocco has a great future, according to the National Agency for the Development of Aquaculture (ANDA), targeting 200,000 tons of production, 40,000 jobs, and revenues of some half-billion dollars by 2020.  Morocco has some distinct advantages: more than 1100 miles of coastline; a commercially attractive fish stock; access to diverse markets; and an expanding aquaculture industry. Currently, there are 19 shellfish farms, a fish farm, a seaweed farm, and a shell mill, in addition to 5 marine aquaculture development stations, with other projects being introduced.

Iron and steel sector launches a publication for greater industry awareness. Called “Steel Impulse,” it will provide a portal for information and exchange to promote and develop the iron and steel sector in Morocco. With the continued growth in large-scale projects including social housing and tourism, it was considered critical to have a platform for to expose the sector more widely.

On the occasion of the launch, President of the iron and steel association (ASM) Amine Louali said, “Our sector is at the heart of the major structuring projects and the strategy of industrialization of the Kingdom. It is our duty to be proactive and to find solutions to the various problems encountered by our sector and to better contribute to the socio-economic development of Morocco. Steel Impulse is a value-added reflection tool and therefore represents an original initiative that must meet these objectives. “

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