OBG talks to Mohamed Mbarki, Director, Agence de l’Oriental

Interview: Mohamed Mbarki

To what extent does the closed border with Algeria affect the development of the Oriental region?

MOHAMED MBARKI: Since Moroccan independence in 1956, the border has been closed more often than it has been open. Economic experts have identified that this causes up to 2% GDP loss across the Maghreb region. However, the current rate of economic development in the area has made it less affected by the closed border, particularly in wake of the launch of the royal initiative for the region’s development in 2003.

At the same time, the region should also prepare for the border to open so as to play a key role in the Maghreb – and indeed to partake in the Euro-Mediterranean region as a whole – as well as to reinforce its links with the national economy. Given the importance of trans-Mediterranean exports, a port like that of Nador West Med can play a key role in global shipping flows and further develop the region as a consequence.

In what way does the informality of the economy impact on development in the Oriental region?

MBARKI: The informal economy is a manifestation of a sub-optimally functioning economy. The Oriental is not more affected by informality than other border regions in the country, or comparable regions elsewhere. Up to now, a common strategy for pushing back the informal economy was through repression and control, but this is not a very effective strategy. It would be better to tackle this issue via economic means.

For instance, contraband can be pushed back when large retail stores arrive giving people more choice at competitive prices and with quality assurances. But people engaged in the sale of contraband also to develop certain commercial skills that could be useful if they were to work in the services sector for instance. A study undertaken by the Chamber of Commerce of Oujda has shown that the informal sector creates jobs and destroys jobs at the same time. However, the balance in that regard is negative in the end, whereby the difference is made by taxation and subsidies that enable informality to occur. In general though, the economy is gradually formalising, with more young people being attracted to stable jobs in the formal economy.

What is the best strategy to pursue in tackling the high rate of youth unemployment in the region?

MBARKI: This is at present a worldwide problem, though more fragile economies are most affected. The principal cause of youth unemployment is that the number of graduates has exceeded the number of available jobs now for some years. There is also the issue that the skills of today’s graduates do not correspond to those demanded by employers. The Oriental region has distinguished itself for the quality of its university graduates. However, improving basic education levels and literacy rates is not just a regional priority, but a national one. To address these problems, pre-schooling needs to be further developed, and it is also important to nurture a spirit of entrepreneurship. In this respect, the agencies concerned now need to take responsibility since the means, the money and the political will are now available, even if implementation is not always easy. Through these initiatives and in cooperation with civil society organisations, we have been able to create about 2500 new jobs.

How can the development of value-adding industries be further encouraged in the region?

MBARKI: For us it is clear industrialisation is key to development. In creating a strategy, we have focussed on developing three industrial zones: the first is near Nador, which is completed and is being commercialised. With the new port of Nador and the Marchica Med, this is a key zone for development. Next is the Agropole of Berkane, built around the clementine business in Berkane and aimed at creating value-added products. Finally, the Technopole at Oujda provides an integrated industrial zone to bring about renewable energy development and environmentally-friendly technologies, and includes an export-oriented offshoring zone.