Nov. 30, 2020
AFTER LEAVING THE AFRICAN UNION (AU) IN 1984 over territorial disputes, Morocco expanded its external focus on Europe and ceded influence on pan-African affairs to other regional powers such as Nigeria, Egypt, and South Africa. But that, and much else, has been changing under the leadership of King Mohammed VI, who marked 20 years in power in 2019.
As one of the five-largest African economies, Morocco maderounds globally before the turn of the 21st century to sign FTAs with the EU in 1995 and then with four European Free Trade Association countries in 1997. And under King Mohammed VI, the country has continued to tick boxes in terms of trade liberalization, becoming the first African country to sign an FTA with the US in 2004 and then rejoining the AU in 2017. In addition to all that, Morocco's application to join the Economic Community of West African States (ECOWAS) was accepted in principle in 2017. King Mohammed VI has expanded the multilateral scope of his
diplomatic action and strengthened Morocco's involvement in the African continent. His vision has been supported by significant investments in African by Moroccan banks, which operate in more than 25 African countries, as well as investments by commodities, construction, energy, and telecom companies; a strategy to promote Casablanca as a regional transport and logistics hub; and a stronger partnership with Nigeria, another key regional player, on the basis of religious diplomacy and a mega gas pipeline project.
From the start, King Mohammed VI expressed his intentions to make Morocco a key player in shaping the Africa of the future. Soon after Morocco rejoined the AU, he said in an address, “Africa is the future. And the future starts today." Over the years, he has made well over 50 visits to African countries, signing more than 1,000 agreements across a broad range of sectors and filling a regional vacuum. And the government has backed up its plans with hard cash. Not only is Morocco the second-largest investor in Africa, its government has encouraged the private sector to invest in sub-Saharan Africa to an extent that 90% of the total FDI went to the region between 2010 and 2018, according to a report by the Financial Times. Ethiopia and Ivory Coast were the prime destinations for Moroccan investment. Morocco's role in regional and global affairs has grown in importance mainly because of strong policies on the domestic front. The government has steered significant resources toward key economic sectors and increased productivity. Sectors such as aerospace, electronics, automotive, and renewable energy have benefited from substantial public resources and a host of incentives to attract FDI. In doing so, Morocco's Doing Business environment has also improved, moving up nine places in the 2019 Doing Business ranking to 60th out of 190 countries, and up 129 in 2009, reflecting years of sustained reforms.
Under King Mohammed VI, the government has rolled out mega infrastructure projects such as the USD2.2-billion Concentrated
Solar Power tower, Africa's only high-speed rail network, and the continent's largest port complex, making Morocco a role model for African countries hungry for development projects. Notably, the new Tangier Med port is currently capable of handling 9 million TEUs per year, three times more than Port Said in Egypt, the next largest in Africa. Through investment in infrastructure, the government aims to leverage Morocco's geographic and cultural links with sub-Saharan Africa, the Middle East, and Europe to make it a regional business and export hub. Another sector that is worth writing home about is automotive, which has spearheaded the emergence of value-added exports over the past decade. Between 2009 and 2018, automobile shipments grew at an average of 39%, from USD224 million to USD3.9 billion. The sector as a whole is the largest export category and accounted for USD6.9 billion in 2018. Investments by major car brands such as Renault, Yazaki, Sews, and PSA Peugeot Citroen have transformed Morocco into the most dynamic automobile manufacturing market in the MENA region. According to the IMF, investment opportunities in Morocco will continue to be supported by solid underlying fundamentals. Real GDP growth will accelerate from an average of 3.1% between 2014 and 2018 to 3.8% until 2023, outpacing average growth rate of 2.7% in the MENA region over the same period. Undoubtedly, a stable and strong Morocco is key to Africa's economic growth, and as evident from the past, only through domestic success can Morocco pursue more initiatives across the continent and further intra-African integration.