Manufacturing industry central to Morocco's exports

The need to diversify production capacity and create jobs has been pushing Morocco to invest in its industrial sector. Outlining the expansion of manufacturing under a series of government-led programmes, a host of emerging sectors are gradually becoming essential for the country’s export capacity.

Through the creation of interlinked production clusters, both the government and private investors are setting the stage for areas such as automotive production, agro-industry and aeronautic components manufacturing to become central to the economy.

In line with this, the sector is receiving support from ongoing investments in infrastructure focused on road extension and port developments that will facilitate logistics. Furthermore, a growing network of industrial parks and special economic zones (SEZs) located across the country is helping to create a manufacturing environment attractive to international players, while state-led training programmes dedicated to the needs of specific industries are speeding the rate at which the kingdom can provide the necessary human resources to support them as they continue to grow. “One of the main differences between Morocco and other countries in Africa and the Middle East is the petrochemicals value chain, which we are yet to have. However, we do have growing value chains in mining, agri-food processing and manufacturing,” Khaldoun Bouacida, managing director and country cluster head Northwest Africa at BASF, told OBG.

GROWING EXPORTS: Putting industry at the centre of development has helped to diversify the country’s potential in exports. Long reliant on selling a limited number of goods in international markets – namely phosphates, agricultural products and textiles – the country has diversified production capacity over the years, as well as trade partners.

According to preliminary figures from the Office des Changes for 2017, the automotive industry accounted for as much as 24% of the kingdom’s exports, followed by agricultural and agro-industrial products at 21%, phosphates and derivative products at 18%, and textile and leather products with 15%. Exports of electronic goods have also seen a consistent increase and now represent 4% of the country’s total. While aerospace, an area of growing importance, represented 5% of exports in 2017. These figures were nearly identical to 2016’s figures, with only slight increases occurring by about one percentage point in automotive and aerospace, while textiles declined by one point. Growth in industries such as auto manufacturing and aeronautics production has helped to put Morocco on the map of global manufacturing. “What the performance of the automotive industry has shown, and to a smaller extent the performance of aeronautics, is that industrialisation can in fact work in Morocco,” Mohammed Rachid, deputy director for international relations and organisations at Casablanca Finance City, told OBG.

SECTOR POLICY: To a large extent, the current industrial revitalisation process began with the 2009-15 National Pact for Industrial Emergence. The six-year government strategy focused the country’s investment and development efforts on key industries where Morocco could be internationally competitive, such as automotive, electronics, aeronautics, agro-industrial processing, textile production and offshoring services. The plan positioned Morocco as an attractive manufacturing centre, securing the arrival of international firms such as Bombardier in the aeronautics segment and French car manufacturer Renault.

In order to build on the gains of the previous industrial plan, authorities unveiled the Industrial Acceleration Plan (Plan d’Accélération Industrielle, PAI) 2014-20. The strategy aims to stimulate production in the kingdom by taking advantage of the impact that the arrival of renowned groups has had for the country’s visibility. The PAI has ambitious goals, one of which is to increase the weight of industry in Morocco’s GDP from 14% in 2014 to as much as 23% by the end of the six-year period. Another key objective of the current plan is to create an additional 500,000 manufacturing related jobs, which is likely to require strong commitments from both the private sector and the government to invest in human resources development (see analysis).

The new industrial roadmap is anchored on the creation of ecosystems of firms organised in clusters that can align and establish lean and efficient manufacturing value chains. This has been reflected through efforts to develop SEZs and industrial areas with a sectoral focus. “Although the PAI has done a lot for specific sectors, most notably aeronautics and automotive, local integration of service suppliers and hence the supply-value chain, still needs improvement,” Marie-Alexandra Veilleux-Laborie, director and head of Morocco at the European Bank for Reconstruction and Development, told OBG. Additionally, upgrading production knowledge and skills is necessary to advance the sector’s productivity. The PAI includes the establishment of a Dh20bn (€1.9bn) fund to support small and medium-sized enterprises seeking to improve capabilities through access to better technology and process improvement. It will also help with formalisation efforts for firms operating outside of the formal economy. On a broader level, the PAI also wants to link production capacity with what has been a political and economic drive of King Mohammed VI’s reign: linking the expansion of the kingdom’s industrial capacity with the opportunities in sub-Saharan Africa.

INTERNATIONAL PRESENCE: The move by domestic industrial groups into other areas of the continent was accelerated over recent years, partly through a number of deals between Moroccan authorities and African governments to set up joint industrial capacity. At the same time, several of the country’s industrial groups have been investing in production capacity elsewhere as a means to entering new markets. One example is the Moroccan cement producer Ciments d’Afrique (CIMAF), which in late 2016 announced plans to build a second cement factory in Côte d’Ivoire, at Bouaké. The CFA25bn (€37.5m) plant, scheduled for completion in 2019, will have a capacity of 500,000 tonnes per annum (tpa), according to international press reports. Moreover, in November 2017 the firm announced it would build a third Bouaké plant at a cost of CFA12bn (€18m), bringing its capacity in the country to 2.3m tpa. Besides currently being Côte d’Ivoire’s largest cement producer, CIMAF is also present in Ghana, Gabon, Burkina Faso, Mali and the Republic of Congo.

Additionally, Morocco’s state-owned OCP group and Nigerian group Dangote signed an agreement in late 2016 to set up a new fertiliser plant in Nigeria, scheduled to be operational in 2018, to supply the country’s agricultural producers. As of early 2018, no updates on progress of the factory had been announced.

Meanwhile, OCP signed a deal in November 2016 with Ethiopian state-run Chemical Industries Corporation that will result in the construction of a $3.7bn fertiliser production unit close to Dire Dawa in Ethiopia. The venture between the two governments is set to be opened mid-2022, with an area of 40.5 ha and production reaching 1.5m tpa of fertiliser and 1.1m tpa of urea. Ethiopia is currently one of the continent’s fastest-growing economies, making it an ideal target for Morocco’s economic expansion. OCP is also set to build a blending plant for fertiliser in Rwanda.

Moreover, a pair of Moroccan pharmaceuticals firms are making significant moves outside the borders. In December 2017 Cooper Pharma launched construction of a manufacturing centre on 20,000 sq metres in the Kigali SEZ in Rwanda. The $6m site, scheduled to open in 2019, will include laboratories, manufacturing, container production and administrative blocks, focused on antibiotics production. Additionally, in December 2017 Pharma 5 began construction of a 1.5-ha site in the Bassam Free Zone in Côte d’Ivoire, which will focus on the production of generic medicine for export across Africa. The location is scheduled to become operational in 2019, producing 100m tablets yearly.

Beyond the continent, Moroccan industrial groups are also increasing their presence in the MENA region. In 2016 Cosumar, Morocco’s only sugar producer, signed a partnership to co-invest with Durrah Advanced Development in the construction of the 15-ha Durrah Sugar Refinery in Yanbu, Saudi Arabia. Set to begin production in 2019, the new unit will have a capacity of 840,000 tpa.

CEMENT: In Morocco the cement segment has seen a considerable amount of interest from foreign and local investors, who continue to bet on capacity increases. Although the long-term potential for cement consumption seems positive, with the country still committing considerable volumes of financial resources to infrastructure and housing development, the short-term prospects have not been as easy for local manufacturers to predict. “Some 20% of cement is delivered to infrastructure projects, while the other 80% is used for housing,” Ahmed Bouahouli, director of the Professional Association of Cement Manufacturers (Association Professionnelle des Cimentiers, APC) told OBG. “There has been considerable regression in the sector. Morocco has the capacity to install 21m tonnes of cement, but only 14m are being consumed, while 3m tonnes are set aside for exports.” Annual consumption reached 14.2m tonnes in 2016, decreasing slightly to around 13.8m in 2017, according to the APC.

Moreover, the cement market is not necessarily geared towards exports. “Unfortunately, most of the plants in Morocco are not close to export facilities, as opposed to a country like Greece, where cement factories were built by ports. So, you have to add in all the land transportation costs when you want to move cement internationally,” Mostapha Hebbassi, marketing director for LafargeHolcim Morocco, told OBG.

ADVERSE EFFECTS: Recent events have also affected domestic cement consumption, but not dampened the overall prospects for the industry. A crisis in the real estate sector led banks to limit credit allocation for new housing developments in the middle- to higher-end segment. However, with the country still having to negotiate a housing deficit, mostly in the lower-income segment, housing construction is set to account for a considerable part of cement consumption in the years to come. In addition, 2016 was an unusually dry agricultural season. “Agriculture impacts the availability of cash in Morocco. Its contribution to GDP is low, but a lot of people depend on it as a source of employment. When a drought comes in, people hold on to their money, which ended up having an impact on cement consumption in 2016,” Hebbassi told OBG. Moreover, the several months the kingdom spent without a functioning government between late 2016 and early 2017 had negative effects. This led to a 4-5% decrease in cement consumption over the first quarter compared to the same period in 2016, according to Hebbassi.

PLAYERS: Several domestic and international companies are present in the segment. LafargeHolcim currently accounts for about half of the country’s production capacity through its six plants and two grinding units. Ciments de l’Atlas has been focusing efforts on expanding its presence in the continent by establishing several production operations across West Africa. Asment Témara, another producer, is a subsidiary of Portuguese firm Cimpor that was taken over by Brazilian conglomerate Camargo Corrêa in 2012. HeidelbergCement entered Morocco in the second half of 2016 after acquiring Italcementi Group and its subsidiary Ciments du Maroc, which runs three cement operations and two grinding stations in the kingdom.

Several new projects are also adding to the country’s capacity. Anouar Invest’s Dh300m (€27.8m) cement plant in Laâyoune, which will operate under the name Cimenteries Marocaines du Sud, will have a production capacity of 500,000 tpa. It was set to open by the end of 2017; however, no update on its progress had been announced as of early 2018.

Moreover, Anouar Invest secured financing from the Industrial and Commercial Bank of China and BMCE Bank of Africa in May 2016 for a second plant set to produce 2.2m tpa. The new unit will be located in Settat and begin operations in 2019. Additionally, construction group Société Général des Travaux du Maroc is building a Dh2.1bn (€194.5m) plant near El Jadida, with a production capacity of 1.4m tpa that will come on-line in 2019.

AUTOMOTIVE: The great success story of the kingdom’s industrialisation drive has been the emergence of a solid and export-oriented automotive segment. Cars have become the main export, surpassing the traditionally critical phosphate sector in terms of value. According to preliminary data from the Office des Changes, the country’s automotive exports reached Dh58.5bn (€5.4bn) in 2017, showing growth of 7% over the 2016 figure of Dh54.6bn (€5bn). The Moroccan Association of Automotive Industry and Trade ( Association Marocaine pour l’Industrie et le Commerce Automobile, AMICA), reported Dh25.2bn (€2.3bn) in 2012 for exports in this area, indicating an increase of 134% over six years; a rate surpassing all expectations of the government and the private sector. Additionally, the level of local integration into vehicle manufacturing rose from 20% in 2012 to 43% in 2016, according to latest available AMICA figures. By 2020 the industry is expected to have a level of domestic integration of 65%. Growth has also aided in increasing employment, with the number of jobs created reaching 85,000 in early 2017, in a segment expected to employ up to 175,000 people and produce exports worth Dh100bn (€9.3bn) annually by 2020, according to industry observers.

FAVOURABLE CONDITIONS: The establishment of the automotive industry in the kingdom can be attributed to government support, such as state incentives, and a favourable geographic location, which facilitates connections to 37 ports in 21 countries. These factors encouraged the move by French firm Renault to bring its production unit to Tangiers in 2012 (see Tangiers chapter). The opening of the factory, linked with the new Tanger-Med Port, quickly distinguished the northern region of Morocco as an ideal location for manufacturers aiming to meet demand for vehicles in North Africa and Europe. In July 2017 Renault reported that it had produced 1m vehicles at its Renault-Nissan Tangier plant, which has a yearly production capacity of 340,000 cars. The factory has shown increasing production in recent years with capacity rising from 174,000 cars in 2014 to more than 375,000 units in 2017. The plant specialises in the firm’s Lodgy, Logan MCV, Dokker and Safpoondero models, but the firm also assembles Logan and Sandero vehicles near Casablanca.

Alongside Renault, other big industry players are moving to take advantage of the opportunity in the country. In mid-2015 French manufacturer PSA Peugeot Citroën announced it would set up a €557m car manufacturing plant in Kenitra, north of the capital Rabat. Initially, the new plant will have a production capacity of 90,000 vehicles per year, though targets have been set for production to eventually reach 200,000 cars, as part of a strategy to increase market share in the region. The Kenitra facility will employ 4500 workers and focus on producing engines, as well as compact and subcompact vehicles. Additionally, a Canadian manufacturer Linamar is building a $280m plant to supply engine parts for a number of automakers, including Peugeot, coming to the country. Authorities have stated that negotiations with other manufacturers for large-scale facilities are under way. In December 2017 Chinese firm BYD announced that it would set up four electric vehicle factories in the Mohammed VI Tangiers Tech City (see Tangiers chapter).

Besides the addition of new factories, the automotive sector’s contribution to the economy will be strengthened through a deeper level of integration. The government’s goal of bringing automotive revenues up to Dh100bn (€9.3bn) by 2020 will have a palpable impact on the ability of stakeholders to manage any future external shocks. “A Dh40bn (€3.7bn) increase in the automotive sector’s revenue alone would allow us to cover a significant portion of any potential increase in oil prices from $50 to $100 [per barrel],” Karim Gharbi, partner and head of research at CFG Bank, told OBG.

Although Morocco has had auto parts production since the 1960s, the arrival of Renault helped galvanise supporting industries. In April 2016 the company announced it would invest $1bn in developing such areas, which will allow 65% of auto components to be manufactured locally. Moreover, in March 2017 Italy-based automotive components manufacturer Sogefi announced it would set up a new €10m production unit in Tangier to manufacture engine filtration systems. The factory, the firm’s first in Africa, will open in 2018.

AERONAUTICS: Although it has lower export revenues than automotive, aeronautics component manufacturing has also taken advantage of the benefits of Morocco’s competitive advantages. “Aeronautics is still small in Morocco, compared to the weight of other industries. But even so, it has been putting Morocco on the international map as a country that is involved in highly competitive market segments,” Jad Benhamdane, senior economic and sector analyst at BMCE Bank of Africa, told OBG. In 2016 the sector accounted for Dh9.2bn (€851.9m) in turnover, a 12.5% increase on 2015, according to figures from the Moroccan Association of Aeronautics and Aerospace (Groupement des Industries Marocaines Aéronautiques et Spatiales, GIMAS). The first quarter of 2017 saw another 15% rise in turnover compared with the first quarter of 2016 according to GIMAS, and by November 2017 the segment had recorded Dh9.8bn (€866m) in turnover, a 16.3% increase on the same period of the previous year, according to the Office des Changes.

Segment players include heavyweights such as Canada’s Bombardier, and France’s Thales and Safran, with more than 120 aeronautics components manufacturers in the country. Linked to global supply chains, aeronautics manufacturing exports have been growing at an average of 18% per year since 2012, and already account for around 5% of annual exports. Regional media reported that this trend was continuing with an increase of 11.3% in the first half of 2017.

The government is confident the segment can double its revenues by 2020 and generate 23,000 new jobs. As in automotive production, a key objective is to raise local integration from 17% in 2016 to 35% by 2020, which would greatly improve the segment’s impact on the development of local industrial capability. At present, the industry employs around 12,000 people and is in need of an influx of qualified staff to facilitate its development (see analysis). “The aeronautics industry does not have a depth of experience and is still in the early stages,” Stephen Orr, vice-president at Bombardier told OBG. “Currently, there are 122 companies in the domestic aeronautics sector, which counts with a strong presence of expatriates in higher management.”

NEW DEVELOPMENTS: In line with meeting these targets, new investment has continued to flow into the segment. In late 2015 Stelia Aerospace begun operations at its 15,000-sq-metre production unit to manufacture metal sub-assemblies to be incorporated in Bombardier and Airbus planes. The Dh426m (€39.4m) plant, which is set to be expanded over the coming years, is the firm’s second unit in Morocco. French aeronautics producer Daher also is opening up a third manufacturing unit in the country close to its Tangiers site. The new 10,000-sq-metre factory amounted to an investment of €15m and will manufacture airplane fuselage components when it begins operations, which were scheduled for 2017 but have yet to be announced as of early 2018. Additionally, authorities have made efforts to encourage development. In September 2016 a deal was signed by the government with Boeing to reach out to some 120 suppliers of the aeronautics manufacturer and encourage them to establish units in the kingdom. The deal is set to add 8700 jobs in the sector and raise the country’s aeronautic exports by $1bn, according to GIMAS.

The government has a history of setting policies to support industry growth. In 2013 an SEZ for the aeronautics sector was established on the outskirts of Casablanca. The Midparc Casablanca Free Zone opened up with an initial first-phase area of 63 ha and is now developing a second phase with an additional 62 ha. The zone offers state subsidies to ease land access and construction for manufacturers, as well as to support with staff training. Midparc also extends a 100% corporate tax break for the initial five years of operation, with a reduced 8.8% rate for the 20 years after that. After the first 25 years, the corporate tax rate increases to 17.5%. “In terms of governmental support, tax incentives are extremely progressive,” Orr said. “On the regulatory side, it is fairly easy to move stuff about between Morocco and North America.”

AGRO-INDUSTRY: With a rich array of agricultural resources and access to rich fishing areas, Morocco’s agro-industrial and food processing sector has long been an extension of the country’s competitive advantages. In recent years the government has continued expansion of the sector, implementing its Green Morocco Plan (Plan Maroc Vert, PMV), a strategy launched in 2008 that runs through 2020 as a means to boost the added value of the country’s agricultural products by intensifying processing activities (see agriculture chapter). According to data published in late 2017 by Export.gov, a body that helps US firms export to international markets, agriculture contributes 15% to the country’s GDP, with the agriculture, fishing and forestry sector employing 45% of the total workforce.

Recently, the Ministry of Agriculture, Fisheries, Rural Development, Water and Forests came out with a sector strategy covering the 2017-21 period. The strategy lays out plans to channel some Dh12bn (€1.1bn) towards supporting the development of 371 new food-processing units, a third of which will be fully financed by the government. The policy also aims to create an additional 38,500 jobs in the agro-industrial sector.

Similar to what is taking place in other segments of the industrial sector, the strategy for agro-processing will focus on the establishment of strategically located industrial zones, which will include associated services such as research and development (R&D), and health and hygiene controls. The PMV included plans for six such areas, several of which are already operational. For instance, the Agropolis de Meknès SEZ opened in 2010 with a total area of 140 ha and 380 lots, and currently has 50 ha and 156 lots available for investors, as of early 2018. Tenants are focused on activities such as meat processing and canned goods. Meanwhile, Berkane, an industrial area that includes a cooperative specialising in dairy products and cheese exports, includes 102 ha and 61 lots, with 17 ha and 21 lots available, as of early 2018.

Investors in these areas include a mix of domestic and international firms. Moroccan group Diana Holding recently bought 5 ha of land in the Berkane Agropole to build a Dh200m (€18.5m) fruit and vegetable canning factory that will cater to international markets. The new unit was scheduled to open by the end of 2017 and employ 500 people, though no announcement to its progress had been made as of February 2018.

PHARMACEUTICALS: The kingdom’s pharmaceuticals industry has a long tradition of domestic manufacturing and export to international markets (see Education & Health chapter). Although the sector has registered lower growth rates since the 2008 financial crisis, pharmaceuticals still represents about 1.5% of the country’s GDP and as much as 5.2% of industrial production, according to figures the Moroccan Association for the Pharmaceuticals Industry (Association Marocaine de l’Industrie Pharmaceutique, AMIP) gave international media in April 2017. The sector’s production capacity comprises more than 45 production units, belonging to the subsidiaries of multinational pharma players, as well as Moroccan producers.

With a turnover of Dh13bn (€1.2bn) in 2016, the sector accounts for 40,000 direct and indirect jobs, according to the latest data from AMIP. Exports of domestically produced pharmaceuticals, at roughly Dh1bn (€92.6m) a year, still make up a small part in comparison with other regional players, with generic medications accounting for the majority of sector exports. According to authorities, the sector is set to grow at an annual rate of 2.2% between 2016 and 2020.

PLASTICS: The plastics industry in Morocco is composed of more than 650 companies, operating across the agro-industrial, tubes and sanitary, packaging and environmental subsegments. According to data reported in early 2018 by the Ministry of Industry, Trade and Investment and Digital Economy (Ministère de l’Industrie, de l’Investissement, du Commerce et de l’Economie Numérique, MICIEN), the segment as a whole accounts for turnover of Dh13.5bn (€1.3bn) and generates nearly 52,000 indirect and 300,000 direct new jobs annually. However, this success has raised some issues for regulators. “Informality in production and distribution represents a real challenge,” Jawad Maaroufi, deputy general manager at Ifriquia Plastic, told OBG. “The current annual per capita consumption amounts to 24 kg and is expected to double by 2020. The informal sector will continue to grow too, if formalisation efforts fail to gain momentum soon.” In 2015 moves were made in this direction when legislation was passed that offered benefits to informal sector workers who registered as self-employed. The move led to some 20,000 new entrepreneurs joining the tax base in the first year of the law’s passing alone.

A high-profile change for the industry came into effect in July 2016, when a ban on the manufacture, use and sale of plastic bags began to be enforced. According to Abdelaziz Lazrak, director at agro-industrial plastics company Micatex, current consumption of plastic bags is estimated to account for just 500,000 tonnes of production per year, and therefore the legal change had more of an impact on consumers than it did on producers, as the plastics industry is already integrated into more industrial processes, he told OBG.

In a move that signals the economic weight of the plastics industry, in January 2018 MICIEN launched a performance contract for plastics running from 2017 to 2020 as part of the broader PAI. Taking on a crucial role in the government’s regionalisation and industrial diversification efforts, the programme primarily entails the launch of a new plastics ecosystem in 2018, to be located in the Souss-Massa region.

PHOSPHATES: Holding around two-thirds of the world’s phosphates reserves, Morocco’s extraction and export of phosphates and derivate products has long been an important source of income. The sector is managed by OCT, which is in charge of overseeing mining, processing and export operations.

Although the industry has been affected by the decrease in phosphate prices since 2013, OCP has worked to compensate for this through an increase in export volumes and the development of an industrial expansion plan, which has included the establishment of fertiliser production units in several countries, as well as new processing capabilities at home.

In September 2017 the company reported a 44% year-on-year increase in exports in the first half of 2017. Revenues for the same period exceeded Dh23bn (€2.1m), compared to approximately Dh21bn (€1.9m) in the first six months of 2016. OCP prepared for this growth in February 2016 with the opening of a new fertiliser unit at Jorf Lasfar, south of Casablanca. The Dh5.3bn (€490.8m) industrial complex produces 1m tpa of fertilisers, as well as 1.4m tpa of sulphuric acid and 450,000 tpa of phosphoric acid, all of which is manufactured for export to African markets.

TEXTILES & HANDICRAFTS: The textiles and handicrafts segment has continued to fill an integral part of the country’s industrial capacity, despite shifting consumption patterns. “There have been two principal macroeconomic developments in the sector: First, China has re-entered the local market. Second, European distributors have passed through the 2008 financial crisis and re-oriented their purchasing strategy away from Asia to focus on nearby markets such as Turkey, Tunisia or Morocco,” Jaafar Merzouki Idrissi, director at textiles company Atrefil, told OBG. This has led to an increased reliance on international buyers to generate segment revenue. “Locally, textiles are performing badly. Morocco’s structured export market has nothing to do with its uncompetitive local market,” said Idrissi. According to the most recent government data, there are around 1600 textile manufacturing units focused on supplying international markets. The segment employs about 175,000 people and has shown steady revenue increases in recent years, bringing in Dh37.4bn (€3.5bn) via exports in 2017, compared to Dh35.3bn (€3.3bn) in 2016 and Dh31.4bn (€2.9bn) in 2015.

Some textile players in the country have taken steps to move into the burgeoning handicrafts market as a way to adapt to changes in consumption. “Eastern European countries are now in the same price range as Morocco,” Saad Boutaleb, vice-president at yarn and fabrics producer Groupe Filarsy Safadi, told OBG. “Textile manufacturers have therefore reinvented themselves for the moment and are promoting Moroccan craft products instead. Additionally, the modernisation of material is not too expensive, though costs for new machines are enormous,” he added.

According to early 2018 figures from the Fédé ration des Entreprises d’Artisanat, the contribution of handicrafts to GDP roughly amounts to 6%, with the segment employing more than 2m artisans.

OUTLOOK: Industry will be a critical element for Morocco, if it is to reduce its dependence on its agricultural sector. The successful development of segments such as the automotive industry and aeronautics have proven that Morocco can be a competitive location to set up manufacturing capabilities. However, the same type of conditions created for other segments where Morocco has the natural conditions to succeed, such as agro-industrial production, will help the government’s industrialisation strategy be effective in the long run. The expansion of SEZs with advantageous conditions for firms, coupled with the enlargement of training programmes, will also make the country increasingly attractive for foreign manufacturers. Still, elements such as the improvement of logistics, the continued adaptability of local firms and the reduction of energy prices will also determine how well Morocco’s industrial exports can compete internationally over the long term.