The report shows that the US-Morocco Free Trade Agreement (FTA) has encouraged business activities between the two countries since the deal came into effect in 2006.
In its overview, the report extolled Morocco’s geographic location and its strategy for attracting international investors.
The executive summary of the report reads that Morocco “enjoys political stability, robust infrastructure, and a strategic location, which have contributed to its emergence as a regional manufacturing and export base for international companies.”
The Government of Morocco has implemented a series of strategies aimed at boosting employment, attracting foreign investment, and raising performance and output in key revenue-earning sectors, such as the automotive and aerospace industries.
With several ports and investment zones, Morocco has attracted renowned international operations specialized in several fields, including the automotive and infrastructure industries.
The automotive and aeronautical industries are significant assets as they play an intrinsic role in Morocco’s economy.
The aeronautic sector is active with more than 120 companies, generating direct annual revenues of more than $1 billion in 2015.
The sector also creates more than 11,000 direct job opportunities, a number that contributes 8.5% to Morocco’s total employment.
The report also unveiled Morocco’s successful strategy to attract investors through facilitating foreign investment This is especially relevant in “export sectors like manufacturing, through macro-economic policies, trade liberalization, investment incentives, and structural reforms.”
Regional business hub
The executive summary indicates that the North African country seeks to position itself as a regional business hub, owing to its status and location at” the tri-regional focal point of Sub-Saharan Africa, the Middle East, and Europe.”
The report indicates that Morocco attracts the “fifth-most foreign direct investment (FDI) in Africa, a figure that increased 23 percent in 2017.”
South Africa’s leading newspaper Daily Maverick published an opinion piece by Gregg Mills, in which he described Morocco as the modern face of a modern Africa.
In the opinion piece, the author celebrated King Mohammed VI’s leadership, which, he said, has led Morocco towards development and radical reforms.
The report also emphasized the success of Morocco’s royal vision and commitments to Africa.
“Morocco’s return to the African Union in January 2017 and the launch of the African Continental Free Trade Area (CFTA) in March 2018 provide Morocco further opportunities to promote foreign investment and trade and accelerate economic development,” the report said.
Despite the reforms and the political stability, the report acknowledged that the country faces challenges in several fields, including the “insufficient skilled labor,” and unemployment.
The report cited press releases from the High Commission for Planning (HCP), stating that unemployment was 9.8% at the end of 2018.
The report recalled that “unemployment among youth aged 15 to 24” hover around “40 % in some urban areas.”
The document also cited Morocco’s strategy to integrate more students into the vocational training programs as a means to curb unemployment.
“The government opened 27 such training centers between 2015 and 2018 and nearly doubled the number of students receiving scholarships for training between 2017 and 2018,” the report said.
US-Morocco FTA agreement
The report also claimed that the US Morocco Free Trade Agreement (FTA) is bearing its fruit for both parties. The US and Morocco signed the FTA in 2006. It came into effect on January 1, 2006.
The trade agreement is a “comprehensive agreement that supports the significant economic and political reforms that are underway in Morocco and provides for improved commercial opportunities for U.S. exports to Morocco by reducing and eliminating trade barriers,” according to the Office of the US Trade Representatives.
The Investment Climate report shows that since the agreement came into effect, bilateral trade between both countries increased by more than 250%. Trade activities, according to the report, made the US Morocco’s fourth largest trading partner.
The US is also the second largest foreign investor and the US. Both countries seek to reinforce their bilateral trade activities through “high level consultations, bilateral dialogue, and the annual U.S.-Morocco trade and Investment Forum.”