NYT Explores How Morocco Became China’s Gateway to Tariff-Free Europe

Doha – New York Times reported last week that Morocco has become essential for Chinese companies avoiding European tariffs, with Chinese automotive investments reaching approximately $10 billion in recent years.

The news outlet recalled President Xi Jinping’s November stopover in Casablanca, where he met Crown Prince Moulay Hassan. According to the Times, this visit marked the strengthening economic relationship between China and Morocco, Africa’s largest automotive manufacturing center.

“The boom is a sign of the growing importance of countries like Morocco, which has a free-trade agreement with the European Union, that serve as connective nodes in a global trading system that is remaking itself around an obstacle course of high tariffs, trade restrictions and geopolitical rivalries,” Patricia Cohen wrote in the Times article.

Chinese battery maker Gotion High-tech is among dozens of Chinese automobile manufacturing companies establishing operations in Morocco.

Last summer, Gotion announced plans to build a $1.3 billion “gigafactory,” the first in Africa. According to the Moroccan government, this investment could potentially rise to $6.5 billion.

The Times indicated that Morocco’s position as a connector country has grown more unstable since the Trump administration “kicked the legs out from under the global trading system.”

Chinese automakers have progressed rapidly in battery technology, automated driving, and entertainment software while pursuing global expansion, the report added.

This advancement prompted the Biden administration to implement a 100 percent tariff on Chinese electric vehicles, with the European Union setting tariffs up to 45 percent. These trade barriers have benefited connector countries like Morocco.

Alexandre Kateb told the Times that Beijing “wants to leverage Morocco’s key advantages,” including its position at “the doorstep of Europe and Africa” and its two-decade development of an “automotive industry ecosystem.”

The country boasts a sophisticated transportation network, including ports like Tangier-Med and large reserves of phosphates used in car battery production. Morocco has also been transitioning rapidly to clean energy.

The Times mentioned that Morocco became the European Union’s leading car exporter in 2023, surpassing China, Japan, and India, according to Auto World Journal.

“For Chinese automakers, Morocco could now play that same role for Europe” that Mexico did for manufacturers avoiding US tariffs, Ahmed Aboudouh from Chatham House told the Times.

‘A hedging strategy’

The Times described Morocco’s complex balancing act between Chinese investments and Western relationships. The Trump administration has raised tariffs on China to as high as 145 percent, now paused for 90 days after negotiations, and could pressure Morocco to take a definitive stance.

Despite Morocco seeing China as “a major partner,” Aboudouh told the Times the country remains “aware of the risk” of pressure from the Trump administration.

Cohen reported that Chinese investments through the Belt and Road Initiative have funded significant Moroccan infrastructure, including high-speed rail, solar plants, and a $10 billion tech hub in Tangier.

A Chinese company was recently selected to provide steel for a planned $26 billion gas pipeline between Nigeria and Morocco.

The Times noted that Morocco maintains important US relationships through NATO exercises, counterterrorism collaboration, and interest in F-35 jets. According to Aboudouh, Morocco will not welcome China “at the expense of the EU and the United States.”

The American newspaper foregrounds Western Sahara as a top priority for Morocco. King Mohammed VI has repeatedly affirmed that the Sahara issue — Morocco’s foremost national cause — is the prism through which Rabat views and conducts its foreign policy. In 2020, Washington, under President Trump, recognized Morocco’s sovereignty over the region.

Despite Morocco’s 20-year free-trade agreement with the US, Trump has imposed a 10 percent across-the-board tariff on virtually all imports, including those from Morocco. However, the Times said, Morocco has avoided the higher tariff levels applied to countries like Mexico, Vietnam, and Thailand.

The newspaper documented continuing Chinese expansion in Morocco. This includes a Chinese battery parts manufacturer that began production in January at a new joint venture in Jorf Lasfar, near Morocco’s deepwater commercial port, part of a $2 billion deal signed in 2023.

It also reported that in October, Chinese tire maker Sentury started production at a new factory in Tangier Tech City, a zone planned to eventually host 200 Chinese companies.

The article concluded with Aboudouh’s assessment that “Morocco has been following a hedging strategy for a long time” between the US and China. While “the Biden administration showed them some tolerance” regarding Chinese investments, he told the Times, “I think they will show more caution” if this flexibility diminishes under Trump.