Why is Morocco Smiling? Tourism Gets Boost from New Investments and Projects

Tourism Minister showcases Morocco’s plans for Tangier, Rabat, and Casablanca

In a series of stories in the business media, the news about tourism in Morocco is all good. The numbers are up; investments are flowing in; and Morocco is gaining greater global recognition as “the place to be.” Situated at the western end of the Mediterranean, a short ferry ride from Spain, Morocco also enjoys a 1300-kilometer long Atlantic waterfront that has become a stop on the world tour of kiteboarding and other aquatic delights! A new report on CNN’s Marketplace Middle East says Morocco ranks among the top trending travel spots for tourists.

Tourism Review, in its annual look at the region, commented, “Untouched by revolutions, Morocco continues to attract. In 2013, the tourism sector represented more than 8.6% of GDP ($9.5 billion). Tourism revenues are expected to grow 8.1% in 2014 according to the World Travel and Tourism, while the Moroccan National Tourist Office plans to host more than 11 million foreign tourists in 2014. Relative peace and social problems of its neighbors make Morocco a popular destination.”

Tourism Minister interviewed on CNN

Minister Lahcen Haddad speaks to CNN

Yet Morocco is not standing still. The Wessal Capital Fund, focusing on the tourism sector, is a collaboration of the Moroccan Fund for Tourism Development, Qatar Holdings, Kuwait’s Al Ajial Investments, Abu Dhabi’s sovereign wealth fund Aabar, and the Saudi Investment Fund, and it is moving with impressive speed. The first priorities, already announced, are projects in Tangier, Casablanca, and Rabat. In Rabat and Tangier, the fund’s investments focus on mixed-use projects that include residential housing, port/marina development, entertainment and destination centers, and commercial and shopping areas. In Casablanca, activities concentrate on the coastline. “Casablanca-Port will completely change the city. There will be hotels, cruising port, marina and an ambitious plan to renovate the old Casablanca’s medina,” according to Tourism Minister Lahcen Haddad.

In addition to the tourism projects, Morocco is also working hard to improve its infrastructure, with high speed trains connecting the three cities, improvements in telecommunications access and bandwidth, and modern, efficient tourist facilities.

In Rabat, the fund will invest nine billion dirhams ($1.10 billion) in the second phase of the Bouregreg River development, which is along the valley where the river winds from the Atlantic Ocean to the interior. There will be hotels, a marina, residential housing, urban green spaces, a museum, and a theater to highlight Rabat’s cultural attractions. Minister Haddad noted that the government is planning to spend another nine billion dirhams to renovate the urban areas of the city.

Tangier is slated for expansion of the world-class Tangier-Med Port on the Mediterranean as well as continued restructuring of its tourism districts. Earlier this year, King Mohammed VI launched the next phase of the port’s development, which features an intermodal terminal that will serve as an advanced industrial and logistical platform with connectivity to markets throughout Europe, North Africa, the Middle East, and Africa. It will include a ferry terminal, passenger services, a railway station with two passenger docks, a bus station, an auditorium of 288 seats, a center with restaurants, banks, shopping and business services, and offices for companies serving the maritime industry.

As for tourism in Tangier, Middle East Online commented that “the city is looking to capitalise on its ‘coastal assets’ — building a marina on the Mediterranean seafront and a fishing harbour on the Atlantic — as well as promoting its cultural scene, with a new arts centre and theatre planned.”

 Building Global Awareness

Morocco's tourism goals in Vision 2020 Plan

Vision 2020 Tourism Plan for Morocco

To ensure that the good news about Morocco’s tourism keeps going global, it has secured the rights to host the World Travel Awards Grand Final for the next three years. The Awards were established by WTA in 1993 to “acknowledge, reward and celebrate excellence across all sectors of the tourism industry. Today, the WTA brand is recognized globally as the ultimate hallmark of quality, with winners setting the benchmark to which all others aspire” according to Travel Daily News.

In announcing the agreement, Minister Haddad noted that “Morocco is an enchanting, hospitable land, full of mystery, wonder, and cultural richness…Hosting the World Travel Awards Grand Final will be a defining event in enhancing the awareness of the Kingdom of Morocco among the most powerful leaders of the travel and hospitality industry.”

In the Middle East and North Africa, where there are few success stories of concrete efforts to meet the economic growth needs of the countries, Morocco is demonstrating repeatedly that it is not taking a wait-and-see attitude. By building international collaboration among investors on concrete projects in Morocco, the country is addressing the twin issues of employment and quality of life. The King’s commitment to human development rests on securing an economy that is responsive to the needs of Moroccans. His ability to pull together international investors and Moroccan expertise in viable projects is a healthy sign for the future.

Unemployment Numbers Mask Job Solutions

In an interview published in the newspaper “L’Economiste,” Moroccan Minister of Employment and Social Affairs Abdeslam Seddiki, made it clear that “to solve the problem of unemployment, we should not count only on growth.”

He went on to say that “according to estimates, 1 percent of growth rate generates an average of 30,000 jobs, and we have a labor market that is witnessing an annual arrival of 180,000 job applications. To meet these arrivals, we need a growth rate of 6 percent, without including the existing stock of unemployed people.”

He pledged to work towards “setting the balance between innovative investment” and those in more traditional sectors that produce direct jobs and “investment in infrastructure that creates indirect employment.”

This distinction is quite important, particularly in the high tech and tourism sectors, since they often create many more indirect jobs than the core employment generate by a specific project.

For example, both high tech and tourism projects have three phases: development, start-up, and operations. During development, many of the employees are related to the planning phase, are engaged off-site and overseas, may be largely expatriates, and perform high-value and capital intensive (as opposed to labor intensive) functions.

Abdeslam SeddikiStart-up requires looking to a broader employment pool to attract qualified expatriate and local employees to provide the services required to bring the project to the operational stage. These workers may or may not stay with the project beyond the short and medium term as their special skills are not needed once the project is up and running.

It is during the operations phase that most long-term jobs are created because other functions are needed, ranging from logistics and maintenance support to marketing and packaging, household services, administrative tasks, and whatever else is needed to sustain the project.

Operations management looks to purchase local goods and services from the most cost-efficient and acceptable sources, thus creating opportunities for indirect jobs that support the project in the functional areas mentioned above.

This is where government programs that promote local business development can play a facilitating role as a broker between the project and the skills and resources available locally.

Morocco is moving in this direction as the Ministry of Employment and Social Affairs is focusing government training programs on a more collaborative relationship with investors in order to anticipate what jobs and local companies will be needed by various projects over the medium and long term.

Government plays a key role in enabling job growth

This is also the target of entrepreneurs in Morocco – finding where opportunities exist locally, regionally, and internationally for their products and services.

Saad Jennane, founder of Kipintouch (left), with Abdelhamid Chakiri of Shorein, Mehdi Tamli of Secret4sale, and Meryem Bennani of Creative Group. Wamda

At the recent Casablanca-based New Work Labs competition called PitchLab, the winner, Kipintouch’s founder Saad Jennane noted that Moroccan entrepreneurs must have a global mindset, not just focused on Morocco.

“We can target the world or an entire region like the Middle East.”

As I have written previously, without an enabling environment, from access to finance and administrative support to friendly legal and regulatory regimes, obstacles will force entrepreneurs to abandon their efforts.

A second major area on which the government is focusing its efforts is the informal sector in Morocco. With an estimated value equivalent to 60 percent of Morocco’s GDP, bringing the informal sector into the marketplace through ease of entry regulations that encourage and reward these small firms will formalize the tens of thousands of informal jobs that are outside the country’s official employment roles.

This would have three immediate impacts: increased tax revenue and participation in social security and related programs, increased opportunities for collaboration among these largely micro-enterprises to enable them to have access to banking and administrative services, and, most importantly, for those with ambition, to provide the means for growth by attracting funding to expand their businesses.

The government’s role in ensuring a positive and business-friendly regulatory environment and in making training and resources accessible is vital and critical to the success of this effort.

The Minister, who noted that the “pressure on the labor market is still high, said that his department can act immediately on existing employment creation policies, namely the Taehil, the Idmaj and Moukawalati programs.

The Taehil program provides pre-employment training partly paid by the government with private sector partners. The Idmaj provides employment training for those with disabilities; and the Moukawalati project is the core entrepreneurship program in Morocco that is built on a public-private sector partnership.

Through greater collaboration with the private sector, more involvement of industry in boosting local sources and skills, and with increased joint investments in training, education, and entrepreneurship development, Morocco can generate the growth in jobs that will meet its needs in the coming decade.

Originally posted at Morocco on the Move. Slideshow photo of Twin Center in Casablanca by YoTut/Flickr.

Morocco Resists Regional Status Quo, Moves Ahead to Define Future –

It’s the weekend in Casablanca. A shallow rain has dampened down the dust on the construction sites, for a few hours. Many people are just starting their day, having had their fill of a Friday dinner that always features heaping mounds of tagine and cous cous. I have been here for more than a week, enough to enjoy the fullness of the days and a good night’s sleep. And they have been full.

The biggest news this past week has been about King Mohammed VI welcoming recommendations by the National Human Rights Council (CNDH) for migrant policy reform, the introduction of sweeping judicial reform legislation, and reports about an agreement for a new governing coalition, one that will hopefully break the stalemate in Parliament.

While these larger issues are in play, I went to meet some of the newer and more active players in Morocco’s retooling of its economy and political life, to get a sense of how Moroccans are managing while the rest of the region stutters through transitions and setbacks.

I began at Maroc Taswiq, a company that is working to solve one of the most vexing challenges to exporting – how to coordinate many small suppliers such as local cooperatives, so that buyers don’t have to make a pilgrimage to have access to Moroccan natural products. In its showroom, located between the Sofitel and the Royal Mansour, are hundreds of organic and otherwise certified products for which Morocco can be a major international source.

From 25 different flavors of honey and dozens of spiced versions of cous cous, to armfuls of spices, nuts, soaps, and olive oils, to various versions of argan oil products, to the latest fad – cactus products – it is hard to take it all in.  Maroc Taswiq’s government title is “Office de Commercialisation et d’Exportation (OCE)” and it provides testing, packaging, marketing, and distribution services.

When I visited, a USAID-financed expert was on site providing his expertise on next steps for marketing OCE’s many products. I managed, barely, to avoid filling a suitcase with the most attractive products, but I encourage US wholesalers to find a home for some dozens of these specialties in their catalogs.

Moroccan Voices for Progress

My next stop was the Moroccan Institute for International Relations (IMRI) where I met with Jawad Kerdoudi, who heads this independent think tank with a keen interest in US-Morocco relations. We talked about the Free Trade Agreement and its impact on bilateral trade; the work of the Economic, Social, and Environmental Council (CESE), which is a year-long study on how to implement regionalization in the Southern Provinces; and also regional political relations. As one of the leading Moroccan intellectuals who travel across North Africa, he has perspectives that are very helpful in framing issues within a context that is less covered in the US media. IMRI is an important stop for anyone who wants to have a helpful exchange about regional issues.

As is not surprising in Morocco, time spent in a hotel lobby can lead to interesting meetings. While talking with the head of Dow Chemical for North Africa, we sat with the head of Green Maghreb Banking, who is working with Development Alternatives, Inc. (DAI) and the European Bank for Reconstruction and Development to promote greater consumer use of solar and green products. We were then joined by former Moroccan Ambassador to the US, Aziz Mekouar, who updated us on Morocco’s outreach to Africa.

The lobby began to fill, as there was a book signing and reception that evening. We were happy to see Mbarka Bouaida, former Parliamentarian and one of Morocco’s most dynamic young leaders, who was the first woman to head Morocco’s version of the committee on Foreign Relations. She provided us with a quick assessment of the ongoing negotiations to build a new governing coalition. As the evening moved along, we caught up with Liz Fanning, former Peace Corps volunteer in Morocco, who is the founder and executive director of Corps Africa, which will soon have its first group of African volunteers to work in Africa on development projects.

Morocco’s Solar Energy Agenda

Back to my business agenda, I met with Ilias Hamdouch, a senior advisor at Morocco’s solar agency MASEN, who provided his thinking on the next two tenders that will be coming out shortly to expand the initial 150mw CSP project in Ouarzazate and how the initial project is impacting the overall energy diversification strategy.

He believes that cost competitiveness and innovative project structure are the top priorities for selecting the contractors. MASEN’s solar strategy goes beyond producing energy to identifying and promoting industrial clusters and teaming with other investors and developers to build a solar industry in Morocco. The opportunities for US companies in downstream solar development range from infrastructure projects like extending the national grid throughout the country to piloting energy efficient building materials, technologies,  services and products.

My next post will feature interviews with CDG Capital,  and Casablanca Financial City, two major players that are coming to New York and Washington, DC the week of October 6 along with the Moroccan Agency for Investment Development (AMDI); and with Phillip Nelson, the US Economic Counselor to Morocco, who gave me an overview of US trade and investment priorities with Morocco.

Crossing the divide: young Moroccans reaching for the future

If Moroccans were any kinder, I would be buying an apartment in this North African nation tomorrow – the only challenge being where! Their multilingual skills were prominently displayed for the past 10 days as I struggled in French, Arabic, and English to get to know Moroccans under 40, many under 30, who are part of the new wave of university graduates and Moroccans returning from abroad committed to building the future Morocco. It was more than invigorating to be talking with young people the age of my children, having conversations that were incisive, insightful, and clear-eyed about the opportunities in their country. They were open and willing to discuss a range of issues related to their aspirations and motivation. As my sentences tumbled out in broken bits of languages, they were immediately in tune with both the intent and the context of my remarks and questions, displaying a sense of humor and desire to understand and to be understood.

These are trying times in Morocco. Against a backdrop of the drama of rifts in the governing political coalition, a large number of regional and international conferences in Morocco are focusing on its place in the global market. There is a growing appreciation that business as usual, whether that means speaking French and selling into the EU or maintaining rigid labor and business hierarchies, is not sufficient. Foreign direct investment continues to grow incrementally, moving beyond real estate and tourism into manufacturing sectors that rely on the improving infrastructure and competitive salaries that Morocco provides. The renewable energy sector, including wind and solar power, is broadening its scope of activities from north to south, requiring even more investment in transportation, power, and broadband/IT services. Most importantly, all of these projects provide opportunities to engage Moroccans who have the talent and energy to acquire or develop skills needed in the global market.

As I spoke with the young people about what skills or attitudes would help Moroccans meet future challenges, the words I heard most often were innovation, creativity, breaking barriers, adaptation, caring, and courage. There is a tension, mirroring young people globally, when they talk about the older elites and networks that they believe limit their prospects for growth. Their impatience and sense of entitlement echoes US graduates whose expectations are undergoing shock therapy in today’s jobs marketplace. As these rising Moroccan stars re-examine their professional aspirations, I detect in many of them a more holistic style in approaching job opportunities. Of course salaries are the first priority but there was a very strong emphasis on the processes and environments they value.

It was surprising that courage came up so often, and for them it has at least two elements. The first is having the confidence to take initiatives, make suggestions, and address issues that in the past had been the purview of only those higher up the workplace food chain. They felt that the support of their peers and managers is the key to building this confidence. The second, closely aligned dimension is risk-taking – feeling secure enough that trial and error is an option because it promotes learning, innovation, and team building. Most felt that risk-taking is valued more inside international companies than Moroccan firms, which often are reluctant to suggest out-of-the-box alternative solutions to their customers. I found this perception was especially strong among those who had worked/studied abroad and experienced the benefits of a more collaborative and creative work milieu. One of the pleasant surprises I encountered in the more than two dozen interviews I conducted is the pride that older (over 40) Moroccan managers have in young people. While counseling that they should be patient and acquire more experience, these managers appreciate the dynamic and intense work styles of their younger teammates. This was quite interesting as at least half of the group is Moroccan women under 35.

I spent a solid ten days in Casablanca building new ties to Morocco and renewing past friendships. While the confidence of the Moroccans with whom I spoke is tempered by the barriers they encounter, there is an essential conviction running through all of them that Morocco can make the needed changes to compete globally. And they are very excited and motivated about being part of that change.