French manufacturers in Morocco | The Economist

How Morocco built an automotive production industry from scratch, creating jobs and making cars “the country’s single biggest export”:

The EconomistCONSIDERING the help provided to big foreign manufacturers in Morocco over the past few years, it would have taken a serious effort by them to fail. Renault, a French carmaker, for example, is thriving: of 2.8m cars it made globally last year, one in ten trundled out from its two shiny assembly plants in Tangier and Casablanca. It hopes eventually to make 400,000 cars a year. The government provided land, excellent roads and power supply, tax advantages and a dedicated railway line to get the vehicles to an enormous port in Tangier. Official efforts to snip red tape and make it easier for firms to operate, and a penchant for signing free-trade deals, help to explain why foreign-direct investment is soaring, even as it shrivels for its neighbours.

One of Morocco’s main draws is a supply of cheap labour. But it has also spent heavily on infrastructure, and not only for Renault. Its road network, railways, airports and ports are modern and well-maintained. It is handily close to the European home of many of the firms that have invested. But most of all, unlike Algeria, Tunisia and Egypt, which to varying degrees can match these other advantages, it offers political stability. The king, Mohammed VI, has championed a plan to industrialise quickly and create jobs for young Moroccans. “We are trying to do in ten years what Britain or France took 80 years to do,” says a Moroccan businessman working with Safran, a French industrial group.

The country’s welcome mat has brought jobs. Four years ago Renault invested €1.6 billion ($2.1 billion) in its main car plant, Africa’s largest, and it now employs nearly 10,000 staff locally. The firm is one of Morocco’s biggest companies. It produces vehicles such as the Lodgy, an entry-level people-carrier sold in Europe. Rapid growth proved possible partly because the king ordained it (his decrees get otherwise languorous civil servants to jump)—for example, in providing generous subsidies for training. Other firms are being lured by Morocco’s largesse. PSA Peugeot Citroën will open an assembly plant in Kenitra, on the Atlantic coast, in 2019, and plans to make 200,000 cars a year…[FULL STORY]


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