Morocco: The world’s gateway to Africa
The kingdom is a rising destination for continental investment and trade
Morocco is the African hotspot for foreign direct investment (FDI), says the kingdom’s Head of Government Saad Dine El Otmani.
Agriculture and services are vital to its economy but “A large amount of FDI is going toward industry as Morocco is placing more importance on this within its development model,” he states, highlighting the automotive, aviation, technology, renewable energy and mining industries as being particularly attractive. There are many reasons for
Morocco’s success, including a stability fostered by King Mohammed VI, a prominent regional and global influence, says El Otmani: “Morocco is an African country at the door of Europe. We have free trade agreements with almost 50 countries.”
Since 2016, the government has introduced around 60 reforms to optimize the business climate, he notes. In collaboration with unions and employers’ organizations, it is also focusing on Morocco’s social climate and education is another priority, El Otmani states: “We established the Superior Council for Education, Training and Scientific Research to put in place a strategic vision for education reform. We have started to apply these reforms, which include making preschool accessible to all and reducing class size.”
Morocco’s World Bank Doing Business ranking “has gone from 97th in 2012 to 53rd in 2020,” says Secretary General of the Government Mohamed Hajoui; “Thanks to our legislative and regulatory reforms, the simplification and digitalization of procedures, and the establishment of new reception and logistical infrastructures, Morocco aspires to become one of the world’s 50 best destinations for industrial, commercial, financial and service activities by 2021.” As a result of the government’s reforms, “Our legislative and regulatory framework has been ranked first in Africa,” states Hajoui. He adds that Morocco’s top-quality infrastructure now includes “Tanger-med port, the largest and most modern port of the Mediterranean and African regions; airports connecting with Europe, Africa, the Middle East, the Americas and Asia; a modern road and railways network; and networks of special economic zones and specialized institutions offering investors guidelines and support.”
U.S. investors are well placed to take advantage of the opportunities in business-friendly Morocco, Hajoui believes: “Since 1786, Morocco has had an uninterrupted friendship and alliance with the U.S. Furthermore, our 2006 free trade agreement has brought remarkable benefits for the economic operators of both countries.” Morocco and the U.S. are also strong partners in the fight against crime and collaboration in this area has deepened recently, particularly in relation to terrorism, says former Minister of Justice Mohamed Auajjar. Overall, he says: “A comprehensive reform of our judicial system has been undertaken in the past few years.” Having established its Superior Council of the Judiciary two years ago, the country now has a demonstrably independent justice system that reflects the Moroccan Constitution enacted in 2011. “The constitution represented a qualitative landmark. It has an entire section on human rights and freedoms, affirms that democracy is our fundamental choice and strengthens judicial independence in a framework where powers are balanced in fairness and cooperate with each other,” Auajjar explains.
Many of the legal reforms that have been implemented, which are aligned to international standards, “strengthen human and civic rights and improve governance,” he states. In 2018, a major reform to the kingdom’s commercial code was also introduced, adds Auajjar: “It is now in line with our open, market economy and desire to improve our attractiveness to investors and businesses. We have adopted new legislation on the difficulties that enterprises can face,
“Morocco aspires to become one of the world’s 50 best destinations for industrial, commercial, financial and service activities by 2021.” Mohamed Hajoui, Secretary General of the Government
which is inspired by the world’s best practices. This enabled us to jump from 134th to 71st place in the “resolving insolvency” criterion of the World Bank’s Doing Business ranking.” In addition, the code’s system for property securities has been improved to facilitate greater access to funding for businesses.
Morocco’s business-friendly environment has made it a financial hub for enterprises working in other African countries. Much of their investment passes through the renowned financial center Casablanca Finance City (CFC), says its CEO, Said Ibrahimi: “CFC is a stepping stone to Africa. We are ranked first in Africa by the Global Financial Centers Index.” About 200 of the world’s leading firms are currently members of the CFC community, including BNP Paribas, American International Group, Mckinsey, Lloyd’s of London and Clifford Chance, states Ibrahimi: “It’s a very comprehensive ecosystem made up of financial institutions, professional services and regional headquarters of international companies. All of them have an African footprint that covers 48 countries in total. We also host investment funds, such as the African Development Bank’s Africa50 fund, because the continent has huge needs in terms of financing and one of our goals is to channel that capital flow.”
CFC members take advantage of Morocco’s many strategic assets, which include a central bank and financial authorities that are regional benchmarks. But membership of the center brings extra benefits, Ibrahimi reveals: “Our members have streamlined processes for all administrative paperwork, they can hire as many expatriates as they want and there is no foreign currency exchange control for members. We have also put in place a mediation and arbitration center led by well-known international arbitrators.” In addition, members receive tax incentives, including a five-year corporate tax exemption, have access to a skilled local talent pool, and can tap into both CFC’S and other members’ in-depth knowledge about doing business in Africa.
With CFC continuing to grow, it is looking to recruit new members in specific financial areas—such as more investment funds, private banking for high-net-worth African individuals and fintech—that will profit from ever increasing opportunities, he says: “The African Continental Free Trade Area will start soon and, by 2050, the continent will be the second biggest in the worldwide economy. The potential is huge but the continent is fragmented— we have 54 countries with 54 different ways of doing business. It’s important to be on the ground in Africa and Casablanca is the best place.”
As the continent gets richer, more Africans are joining the many people from around the world who travel to Morocco for first-class cosmetic treatments from the state-of-the-art Guess Clinic in Casablanca, says its owner and leading plastic surgeon, Dr. Mohamed Guessous: “We offer personalized medical tourism, our techniques are at the global forefront, and we are passionate about beauty and well-being.” The clinic has gained recognition for specialties that include cosmetic surgery and medicine, laser treatments, hair transplants, dentistry and gynecological cosmetic medicine. Guessous is now looking to expand his Guess Clinic concept, possibly with external partners, he states. Reflecting the Moroccan economy overall, success is breeding ever more success.