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The Moroccan construction sector witnessed a significant slowdown in 2013 due to a confluence of factors, including regional instability and a shortage of access to financing. Cement consumption, which is considered a key performance indicator, dropped from 15.87m tonnes in 2012 to 14.87m tonnes in 2013. Nevertheless, the Ministry of Habitat and Urban Planning continued to help drive sector activity and provided strong financial incentives to real estate developers to invest in social housing. The sector is expected to rebound in the medium term, with growth of 4% projected. In the longer run, it should see an uptick in growth as European economies begin to improve. Activity in the real estate sector has fallen, but stabilised, following an earlier boom between 2007 and 2008. In 2013, the sector remained stagnant, growing by 0.4% y-o-y by the third quarter, with transaction volumes down by 5.3%. The sector has been buoyed by a government-sponsored incentives aimed at attracting real estate developers and builders to the mid-range segment, where there is a housing deficit. The luxury segment has witnessed a sharp fall in demand and developers have refocused their activity away from rural areas and smaller towns and towards bigger cities. Prices are expected to remain stable for the luxury segment, while mid-range property is likely to see prices increase in 2014. In 2014, activity will be driven by a number of major mixed-use projects in Casablanca and Tangiers. This chapter contains interviews with David Toledano, President, Federation of Construction Materials Industries (FMC), and Youssef Ibn Mansour, President, National Federation of Real Estate Developers (FNPI).

Unfavourable weather conditions characterised by cold temperatures and drought took their toll on a number of key crops in 2012. However, better weather conditions and abundant rainfall in 2013 allowed for higher domestic production, particularly in the cereals segment, which produced 9.7m tonnes, up 89% compared to 2012. Morocco’s primary sector still plays a significant role in terms of job creation, trade, rural development and overall headline GDP. At present, agriculture contributes around 15% of GDP. In 2013 the sector accounted for 39.4% of total jobs and 72.7% of rural jobs. Agricultural goods represent about 12% of the overall value of exports and constitute a key source of foreign exchange earnings. The value of imported agricultural goods ranges between 14% and 24% of total imports, and key imported products include wheat, sugar and powdered milk. As the country pursues its plans to modernise agriculture and increase support to producers and small-scale farmers, production should continue to expand. Nevertheless, output, notably in cereals and fruits and vegetables, remains vulnerable to changing weather conditions, and efforts to mitigate risks will be a determining factor in securing revenues for both farmers and agribusinesses. This chapter contains interviews with Aziz Akhannouch, Minister of Agriculture, and Ali Berbich, Chairman of the Management Board, Zalagh Holding

The 2003-13 royal initiative, the region’s 10-year economic development programme introduced in 2003, has transformed the Oriental’s economy, placing a strong emphasis on local industry, value-added agricultural production, application of new technologies and a reduction in economic reliance on Algeria. The region has many advantages, including its Mediterranean coastline, a fertile agricultural environment in the north, diverse topography and a young population. However, the region still has a number of hurdles to overcome. The authorities still have a long way to go to reduce the role of the informal economy, for instance, and support the growth of SMEs at a local level. The region is nonetheless well positioned to see a significant increase in growth. Considerable public investment in infrastructure over the last decade has benefitted companies throughout the construction, public works and building materials sectors. With improved infrastructure, new turnkey zones for potential investors, and a spate of investments in the service and social sectors, the scope for growth in the Oriental region is significant.

As a net importer of energy, Morocco is faced with the challenging proposition of satisfying rising local demand while keeping its import bill in check. As a result, energy independence is at the top of the government’s agenda, bundled with efforts to improve domestic energy infrastructure, such as refinery capacities, storage and power generation, and more efficient use of cleaner energy sources. With consumption figures and global commodity prices rising, the government’s balance sheet has been under increasing pressure. According to the Minister of Energy, Mines Water and Environment, total expenditure on energy imports – dominated by crude and refined oil products – rose from 7% of GDP in 2009 to 10.7% in 2011, when it equalled Dh85bn (€7.55bn). Bold energy policies have attracted significant investor interest in recent years, and as a result, an increasing number of players are addressing opportunities in the upstream segment. Morocco is also looking south, where promising growth in the West African market is generating interest among policymakers’ in developing grid connections. Significant challenges remain, however, in terms of funding government-owned entities and so far largely unsuccessful hydrocarbons exploration. This chapter contains interviews with Amina Benkhadra, Managing Director, National Hydrocarbons and Mining Office (ONHYM), and Ali Fassi Fihri, Managing Director, Office National de l’Electricité et de l’Eau Potable (ONEE)

Following rapid growth in SIM card sales and an even faster drop in tariffs, Moroccan telecoms operators seem to have entered at the tail end of the race for a market share of the voice segment. The number of mobile customers grew by 8.73% in 2013, reaching approximately 42.4m. This far exceeded the target set under the government’s “Digital Morocco 2013” strategy. Pre-paid customers dominate the local market with 95% of total subscriptions. The post-paid segment is also on the rise, seeing a growth rate of 14.38% year-on-year in 2013. The local telecoms market it dominated by three providers each with strengths in different segments as well as operations in North and West Africa. In March 2014, the government gave the green light for the ANRT to launch the 4G licensing process. Tendering is ongoing, with licences set to be issued by the end of the year and infrastructure migration to begin before 2015. As 4G licences are waiting to be awarded, mobile data is set to attract attention in 2014 and beyond, accelerating ongoing infrastructure investment plans and giving local content developers a boost. While IT has significant growth potential, it also faces a number of challenges. Morocco’s domestic IT sector is highly fragmented. As of year-end 2013, the industry was home to more than 200 service providers, most of which are small sized and operating at the local or regional level. The sector’s gross turnover in 2013 was estimated at Dh36bn (€3.2bn). Under the €460m Digital Morocco strategy, the government is targeting a number of goals related to SMEs, including upgrading IT infrastructure, growing cooperation with state-owned entities and increasing the share of IT investment from SMEs from 0.5% to 1%. This chapter contains interviews with Azdine El Mountassir Billah, Managing Director, National Telecommunications Regulatory Agency (ANRT), and Mohamed Horani, CEO, Hightech Payment Systems.

Significant strides have been made in improving health indicators, particularly in terms of maternal and child mortality rates. Costs, however, are likely to remain a major obstacle, with out-of-pocket expenditure accounting for approximately 53% of spending on health care. A 2011 constitutional amendment enshrined access to health care as a basic right and the authorities are working to expand coverage. The Medical Assistance Regime (Régime d’Assistance Médicale, RAMED), first launched in 2009, aims to provide 8.5m impoverished people – around 27% of the total population – with medical assistance to enhance access to medical and health care service. As of end-2013, around 7m people were benefiting from RAMED coverage. Ongoing negotiations to extend insurance coverage will be key to ensuring universal access to health care services. The expansion of rural health care, notably emergency services, should also contribute towards reducing the disparity in service provision throughout the country. The Emergency Plan 2009-12 has channeled substantial funds into the education sector, allowing better infrastructure to facilitate an increase in school enrollment rates. Nevertheless, a number of challenges still need to be addressed to improve access to education in rural areas and ensure greater gender equality. Launched five years ago, the Emergency Plan 2009-12 aims to boost schooling levels in the kingdom, enhance the quality of teaching and infrastructure, and improve higher education and scientific research. Net enrolment in primary education went up from 52.4% to 98.2% between 2005/06 and 2012/13, while middle school and secondary school also saw improved enrolment levels. The growth of private universities and the proliferation of PPPs in higher education should help Morocco absorb a rising number of prospective students, as well as allow the country to create offerings in line with the needs of the job market. This chapter contains interviews with El Houssaine Louardi, Minister of Health; Mehdi Zaghloul, President, Maroc Innovation et Santé; and Larbi Bencheikh, Managing Director, Office of Vocational Training and Employment Promotion (OFPPT).