The North African nation of Morocco is pitching itself as the preferred beachhead for American companies looking to take advantage of the next great driver of global economic growth: Africa’s 1 billion consumers and rising middle class.
Top business leaders, government officials and diplomats made that point and more during the annual U.S.-Morocco Trade and Investment Forum, this year hosted in Atlanta by Coca-Cola Co., which has a strong brand and business presence in the country of 33 million people, including a bottling plant in Marrakech that can churn out 26,000 glass bottles of the locally developed Hawai orange drink per hour.
In addition to strong ties with Europe — with a Spanish and French colonial heritage and just eight miles separating it across the Strait of Gibraltar from Spain — Morocco is also the No. 2 African country investing in Africa. Its insurance companies and banks like Attijariwafa Bank, BCP and BMCE are working throughout the continent, and not just in French-speaking North and West Africa.
Casablanca Finance City was set up in 2010 to provide a focal point for service providers and corporate headquarters of firms looking for a regional base. Casablanca, better known in America from the classic movie set in the city, is emerging as a finance hub and boasts the third largest stock market on the continent. Free zones connected to ports are luring automotive and aerospace manufacturers.
These capabilities allows U.S. investors in Morocco to deal with a handful of advisers for African expansion rather than trying to break into multiple markets on their own, Moroccan Ambassador Rachad Bouhlal told Global Atlanta in an interview.
“Anywhere you go, you will rely on banks. They know the countries, they know the clients, they are connected to everybody, and it’s the reason Morocco has become the second African investor,” Mr. Bouhlal said.
Minister Mahmoune Bouhdoud, minster of small and medium businesses in the Ministry of Trade, Investment and Digital Economy, believes the continent is at the same point as Asia two decades ago. The difference is that in the Pacific, a handful of players like China dominate the economic landscape. Africa requires a partner that can “translate the complexity” of business in 55 nations. Morocco, he said, blends sophistication with its first-hand experience as a developing nation.
“You want to bet on the next 20 years, not on the past 20 years. That’s where you have to be,” he said. “Asia’s growing economy changed the world map, and there were two kinds of companies: the ones that predicted their positioning in Asia and the others. What we believe is that it’s exactly the same for Africa.”
He added that developing countries like Morocco are looking to use technology to “leapfrog” the traditional growth curve, and the mobile banking sector throughout Africa is a prime example of that trend.
“You don’t have to wait until there is a Moroccan Goldman Sachs to develop mobile banking,” he said.
Morocco has a free trade agreement with the United States enacted in 2006, which has led to increased bilateral trade now totaling $3 billion (with a rare U.S. trade surplus of more than $1.1 billion). More than 100 U.S. firms including the likes of Boeing Co. and General Dynamics Corp. have a presence there, according to the ambassador.
Georgia, the No. 7 exporter to Morocco with $71 million in sales in 2014, is among the states being targeted for increased interaction. Mr. Bouhlal said he spoke with Georgia Department of Economic Development Commissioner Chris Carr about a potential trade delegation and met with Agriculture Commissioner Gary Black to discuss knowledge exchanges on water conservation and compliance with food-safety regulations in the U.S.
“It’s so difficult to go through all the FDA processes. It’s very complicated. Our controls are very good, but what we need to is to get closer to the way the Americans do it, so there will be training our teams. We will have experts going from Georgia to Morocco, and experts coming from Morocco to Georgia,” Mr. Bouhlal said.
He added that Rep. Hank Johnson of Stone Mountain visited Morocco in the past and was an ally in setting up the ambassador’s visit to Atlanta. They published a joint byline on business ties between Georgia and Morocco this week. When he returns to Washington, Mr. Bouhlal said he would reach out to the entire Georgia congressional delegation.
Of course, the country’s economic objectives hinge on U.S. investors knowing where Morocco is — a challenge in its own right — and being able to see past its troubled neighborhood and its reputation as simply a photogenic tourist hub with desert-dwelling Berbers and bustling bazaars.
Morocco, a mostly Muslim monarchy, responded to the Arab Spring in 2011 by enacting swift constitutional reforms aimed at ensuring the stability prized by investors. While it has been years since the last major terrorist attack on a cafe in 2011, the country has been on high alert in light of recent attacks on a beach resort and museum in Tunisia. The British government updated its travel advice for Morocco in September, informing the half-million Brits visiting the country every year about a heightened terrorism threat cited by the Moroccan government, which it said disrupts terror cells frequently. The note ends with a curt summary precaution: “You should be vigilant at this time.”
Overall, however, violent crime is a rarity in Morocco. Mr. Bouhlal said the country is safe and that regional security challenges haven’t dented the tourism sector appreciably.
“When anything happens in the region, you could have reactions, but it was not a big impact, and 10 million was our target for 2010 and the target for 2020 is 20 million. All the big brands are coming and investing and building hotels in Morocco.”
He noted that the country is working to combat extremism, with its religious institutions playing a critical role in training imams from Africa and Europe on how to prevent radicalization of youth. Earlier this month, King Muhammed VI sent a speech to be read at the United Nations counter-extremism summit in New York.
Ultimately, though, it’s companies like Coke, which Mr. Bouhdoud said is investing about $40 million in its Moroccan bottling operation, that will help persuade investors that Morocco is a favorable place to live and do business.
“Coca-Cola is so famous, it’s such a brand. When a company like Coca-Cola opens its headquarters to a country to do a joint event promoting the country, it means that they are doing good business there. It’s good also for our image. It’s a signal to other companies,” Mr. Bouhlal said.
Minister Bouhdoud agreed.
[pullquote]“You can promote your place as much as you can. If you don’t have companies that are having strong success there, it’s worth nothing.”[/pullquote]
“You can promote your place as much as you can. If you don’t have companies that are having strong success there, it’s worth nothing. It’s as simple as that, and the more prestigious the name is, the more powerful the impact you will have.”
The country aims to work with Boeing on next year’s forum in the U.S.
Conceding that it could be awhile, Mr. Bouhlal said he also would like to see a nonstop flight to the country from an airline like Delta Air Lines Inc. Right now its only nonstop link with the U.S. is from New York to Casablanca on Royal Air Maroc.
The ambassador added that Morocco would eventually appoint an honorary consul for Georgia.
Photo credits:
Top: Photo by Frank Douwes used under Creative Commons license.
Middle: Photo of Casablanca by morton1905 on flickr, used under Creative Commons license. The image has been slightly cropped.
