Boasting political stability, a flourishing economy, a well-developed business environment and openness to foreign investment, Morocco is definitely a business destination to bear in mind for any enterprise considering international projects.
Why invest in Morocco?
A trade environment that encourages business development:
- It's one of the most advanced and developed markets in Africa.
- Morocco's competitive costs and world-class infrastructure have earned the country a Best Cost reputation.
- Through the Invest in Morocco government agency, the country offers a broad spectrum of incentives ranging from low taxes to subsidy programs and including the supply of any technical training required.
- The labour force is young, active and qualified. Almost half of the working population, 12 million of 35 million inhabitants, is active, and the median age is only 29.
- Moroccans speak Arabic, French, English and Spanish. This is a major advantage for foreign investors.
- Morocco enjoys a leading-edge specialized training program providing access to highly qualified personnel.
- The infrastructure is also solidly developed. There are 16 international airports, a modern bus service and, most notably: Tanger-Med, Africa's largest port. In 2018, the continually developing country will launch a high-speed train link between Tangier and Casablanca. And to top it all off, Morocco boasts an efficient 4G/LTE network.
- It ranked 68th out of 190 nations on the Doing Business 2017 survey, which lists the best places in the world to do business.
- Canada and Morocco enjoy well-established, well-maintained business relations.
Strategic geographical positioning:
- Morocco's easy access to 1.3 billion consumers, based on numerous free-trade and association agreements signed with the U.S., the European Union, the Arab League and Turkey, among others, provides for a steady source of remarkable opportunities. There is in fact an agreement currently being negotiated with Canada and other West African nations.
- The Kingdom's regional investments have made it an open door on Sub-Saharan Africa.
A flourishing economy:
- In 2016, Morocco's was the tenth-largest economy in the Middle East and North Africa.
- Its GDP shows steady growth, from $60 billion U.S. in 2004 to $104 billion in 2016.
- Inflation remains well under control. Between 2007 and 2016, average inflation was 1.6%, as opposed to 2.9% in China, 4.2% in Tunisia and 8.1% in Turkey.
- Household consumption is always on the rise, with annual growth of 5% between 2010 and 2015, when it reached $59 billion U.S.
- Investment is seen here as a determining factor of sustainable, sustained growth. From that perspective, the government has undertaken a trade liberalization plan by easing procedures, by providing private operators with better protection and by passing new legislation to improve investing conditions.
Most notably, the political situation is consistently stable.
Where to invest?
Today, the lion's share of economic and industrial activity happens along the north-west axis: Casablanca, Rabat and Tangier. Rabat, the capital, is considered the political and administrative centre, but Casablanca is the nation's economic driver. It forms the regional exchange platform between Africa and the rest of the world, as well as Morocco's prime financial hub, where most industrial facilities are concentrated. In fact, Casablanca Finance City ranks first in Africa and 30th worldwide in terms of the competitiveness index for financial hubs.
One last thing to remember is that Morocco also has integrated industrial platforms (P2I) providing access to infrastructure like MidParc, Casablanca. This is basically a free-trade zone for the purpose of facilitating the establishment of new businesses by offering a preferred taxation framework, not to mention a great number of adapted services. That is how Bombardier Aerospace took full advantage of this status.
What sectors are best to invest in?
Morocco features some very promising investment sectors, particularly in industry. Those listed below merit close attention:
Aerospace: aerostructures, aeronautical equipment, cabling, milling, sheet metal work, surface treatment, engineering, maintenance and repairs
Foreign companies already established: Bombardier, Stelia Aerospace (Airbus affiliate), Hexcel Corporation
The production and export of automobile equipment
Foreign companies already established: Renault, Yazaki, PSA Peugeot, Citroën
Agrobusiness, which represents 30% of the country's total industrial production
Textiles and clothing
Foreign companies already established: Fruit of the Loom, Décathlon
Building and construction work Unprecedented development in construction materials
Foreign company already established: Lafarge
Chemicals and parachemicals, driven by ready access to phosphate
Foreign companies already established: Procter & Gamble, International Paper
Offshoring: Business process outsourcing (BPO) and information technology outsourcing (ITO)
Foreign companies already established: Dell, CGI, BNP Paribas, IBM, Ubisoft
The development of these varied sectors of business is the ongoing result of the Industrial Acceleration Plan instituted by the government in 2014. The purpose of the plan was to breathe new energy into industrial activities and thus strengthen their positioning as a major driver of growth.
Two tips for successful establishment
- Make the right choice among business partners and service providers. This is a major key to success. Many of the country's business sectors are actively seeking new technical expertise and skills that can result from associations with foreign companies. However, it would be wise to be accompanied through the process by professionals with local expertise who will streamline the establishment process by supporting the business plan, securing subsidies and financing, and physically instituting business activities in the host country.
- The second tip is to develop in-depth understanding of the local culture, as well as a modest and gracious approach. Such an attitude is an essential part of easing your business and its footprint into the local landscape. Adopting respectful behaviour and learning a few polite forms of address are the foundation of prosperous business relations, and any solid partnership, for that matter. Long marked by its past history as a protectorate and dominated by French culture, Morocco has transformed its colonial image and taken its rightful place among the world's cultures. The nation's recent partnerships are based on mutual trust and equal footing.
Are you interested in Morocco? Find out more about this country's possibilities and limitations by arranging one or more fact-finding missions beforehand. Such business travel will give you an idea of the local realities and enable you to familiarize yourself with the local setting and develop an appreciation for all of the possibilities available.
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Country Info: Morocco, EDC
Why Morocco: 7 Top Reasons, Moroccan Investment Development Agency
Why Morocco: Investment Opportunities Moroccan Investment Development Agency
Morocco Country Factfile, Euromonitor International