Jean R. AbiNader
July 1, 2019
The end of June saw a flurry of announcements and actions that solidify Morocco’s profile as a country determined to build a diverse and sustainable economy. From growing the infrastructure to regional relations, Moroccans can take pride in the steps taken since the country adopted more aggressive national development plans more than a decade ago. Morocco is in the top three on the continent in most manufacturing sectors, and it continues to play a leadership role in ensuring new opportunities for future expansion and consolidation of its regional ties.
One of the most challenging issues is managing relations with the EU regarding fishing rights off the western coast of Morocco due to the agitation against any agreement by supporters of the Polisario’s claim to represent the Sahrawi people. So it is a great feat that the EU agreed to renew the fisheries agreement this past January, which has now been approved by the House of Representatives, the lower house of the Moroccan Parliament. Fishing agreements go back some 30 years and have been a solid foundation for expanding the sector by including an increasing number of Moroccans as crews of the fleets and ensuring that local populations benefit directly from the agreement.
The House also approved the exchange of letters relating to the agreement that “confirms that the Sahara southern provinces are an integral part of Morocco, as the text clearly specifies that the fishing zone extends from Cape Spartel in northern Morocco to Cape Blanc to the south of Dakhla,” as detailed by the North Africa Post.
Overall, the agreement defines the conditions for access rights, composition of crews, rules that preserve sustainable fishing, and an increase of 30% in the payment to Morocco to some $60 million. A critical feature of the plan to improve the social-economic conditions of the local populations include contributions to infrastructure, basic social services, assistance in enterprise creation, vocational training, and modernization of the fishing sector. In order to protect sustainability of several species, limitations or exclusions are included in the agreement and a monitoring and control system for a broad range of categories was agreed to as well as the exclusion of the Mediterranean Sea, which has been overexploited.
Speaking of ports, the big news carried by the international press is the expansion of Tanger-Med Port, which is now the largest port on the Mediterranean in terms of container capacity. When this goal was announced 15 years ago, some were skeptical, but the results have more than met the projections and generated tens of thousands of direct jobs in the region, which hosts much of the automobile and aeronautics manufacturing supply chain.
Situated on the western tip of the Mediterranean, port authorities hope that its location will attract African and Asia container transport as well as intra-Med conveyance. Currently, some 90% of container volumes passing through the ports are transiting to other destinations. The biggest market, with a 40% share, is West Africa, where Moroccan firms have heavily expanded to in recent years. Some 20% will go to Europe and 10% to the Americas. To date, Morocco has invested more than $1.4 billion in the initial terminal, creating some 6,000 jobs at the port and an additional 70,000 in the adjacent trade zone.
Tanger Med has been ranked #1 in Africa in container capacity for the past two years, and claimed the 45thslot globally. With the completion of the current expansion, it will rank among the world’s top 20 in terms of container capacity.
Water is not only an avenue for a more robust economy but the scarcity of water poses a distinct threat to Morocco’s future. The World Resources Institute, Despite ambitious attempts to cope with the effects of water shortage and climate change, Morocco has projected that Morocco will face extremely high water stress by 2040. The Food and Agriculture Organization (FAO) and United Nations data indicate that Morocco’s volume of water has dropped by 80%
Analysts agree that the country’s water is running out and if nothing is done, levels could drop below the U.N.’s threshold for “absolute water scarcity” by 2020. This would not only affect coastal areas, but could herald the advance of the Sahara desert advance northwards due to climate change, a scenario which threatens Morocco’s important agricultural sector which accounts for 15% of GDP and currently employs 40 percent of the country’s workforce.
To solve the water deficit in the Agadir region in the southwest of the country, Morocco plans to commence the construction of the world’s largest sea water desalination plant in 2021. It will be situated in a region where much of the economic activity is tied to tourism and are small and large scale farms. The mobilization of local farmers has been a vital piece in enabling this project to move forward.
The government entered into a deal with the locals which will enable them have access to the desalinated water for irrigation at a cheap price per cubic meter in exchange for the investment in construction. This public-private partnership may serve as a model for similar projects in other regions.
The success of the project will see Morocco become a home to the world’s largest renewable energy-run desalination plant for drinking water and irrigation.
Another avenue for Morocco’s development is its agreements with international organizations that support economic, social, and political growth of the country. A recent example is the signing of a MoU between Morocco and the Organization for Economic Cooperation and Development (OECD). This renewal of an current 3-year program will support Morocco’s reform agenda.
Called the Country Program, it has been successful to “in supporting the implementation of key reforms, including the strengthening of public policies, encouraging a participatory and open government approach, and reinforcing a culture of evaluation and monitoring,” according to a summary provided by the North Africa Post. OECD Secretary General Angel Gurria said that the MoU “Will enable Morocco to intensify the implementation of recommendations of the first Country Program and address other important challenges, such as the fight against corruption, the promotion of investments, and the undertaking of structural reforms that can boost inclusive and sustainable growth.”
The Country Program is an innovative OECD tool that enables some partner economies to leverage OECD expertise and best practices, strengthen institutions, and build capacity for successful policy reforms. Morocco is one of four partner economies along with Kazakhstan, Peru and Thailand, which have been selected for this bilateral work program covering multiple areas, including investment, public governance, education and territorial development.