Major infrastructure projects are scrambling for finances across North Africa as a result of the global slowdown, but Morocco is forging ahead with its ambitious plans for Tanger Med II Port, a port expansion project that it hopes will position the kingdom s transport sector at the centre of Mediterranean trade.
On June 17, King Mohammed VI launched the construction of the Dh9.25 billion (?828 million) port, laying to rest months of speculation about how the recession would affect the two-year old plans. Building was initially set to begin at the end of 2008, but final approval did not come through until January. Despite the delay, the project, which is set to provide capacity for 5m twenty-foot equivalent units (TEUs), has received the required financing and Marsa Maroc has signed an agreement with the Tanger Med Special Agency (TMSA) to operate the port for 30 years. The Moroccan company plans to invest ?320 million.
The commitment is a significant one, particularly in this economic climate, but the success of Tanger Med I suggests that the Moroccan transport sector has potential for further development. The first port, which has a capacity of 3 million TEUs, opened in July 2007 and almost immediately the government authorities announced the plan for expansion. With an anticipated total capacity of 8m TEUs by 2015, Tanger-Med aims to rank among the world s largest container ports.
The reforms have already begun to pay off. Mohammed Abdeljalil, the president of Marsa Maroc, told OBG that the port has enabled Morocco to move from 75th place in the world in terms of routes and connectivity to 30th place , adding that, along with Egypt and South Africa, the kingdom is now one of the top-three African countries in terms of maritime connectivity .
As the Moroccan market represents an estimated 800,000 containers annually, most of the port s activities are focused on transit trade: transferring containers and cargo arriving from smaller regional ports onto the world s largest ships to travel onward to Europe, Asia and America and vice versa. While container traffic has declined 10% since the onset of the slowdown, Morocco has fared better than the global markets, which have dropped an average of 20 percent, according to Abdeljalil. Morocco s port and maritime sector has been relatively well protected because north-south exchanges have not been as badly hit as east-west markets, he told OBG.
The relative security of Morocco s trade is good news for Tangiers, which, in addition to the large port, includes logistics areas and free trade and industrial zones on an area of 550 sq km. The government s aim is not only to establish Morocco as a main destination for world shipping lines, but also to become an industry-based export centre that will be the main engine in the economic development of the kingdom s underdeveloped northern region. Thus far the plan seems to be working. There are more than 400 businesses currently based in the Tangier Free Zone (TFZ), which provide jobs for 40,000 people. The 345-ha TFZ was the first such zone in Morocco and today, 10 years after it opened, it is nearly fully occupied, having attracted foreign investors through incentives such as no import tax, no benefit tax for the first five years of operations and no Customs charges.
Although the TZF is operating almost at capacity, there are new opportunities that the expansion will provide. The port will create an estimated 300,000 more jobs once it is complete in 2014, Karim Ghellab, the minister of equipment and transport, said in a press conference at the ribbon-cutting ceremony. Additional processing zones include the 250-ha port logistics zone known as Medhub and the 1000-ha industrial zone at Melloussa-Joamaa. Medhub is under construction and will focus on warehousing and light value-added activities such as assembling. Unlike the TFZ, the Melloussa-Joamaa industrial zone will not be a free trade zone – it will essentially cater to Moroccan firms in search of quality facilities and proximity to the port. Like the TFZ, it offers attractive tax schemes and low labour costs and has already lured a major operation: the Renault Group will build an assembly plant that will produce some 200,000 vehicles by 2010 and 400,000 by 2012. Initially the project was to be a joint operation betwen Renault and Nissan, but the latter put its participation on hold due to financial constraints caused by the downturn. There was some question of whether plans would be delayed following Nissan s withdrawal, but Renault affirmed its commitment in late June and construction is expected to begin in early September. The total investment, to which the Moroccan government is also contributing, is ?600m. The factory is expected to create 6000 direct jobs and over 30,000 indirect ones.
With the government hoping to bring the unemployment rate down to 7 percent by 2012, according to Prime Minsiter Abbas El Fassi, the Renault plant is an important opportunity. Building on its success, the TSMA hopes to create a total of 150,000 jobs over the next decade in all of its logistics, industrial, office zone and port facilities.
In this difficult economic context, many countries and investors have decided to suspend their investment, but Morocco has decided to pursue its ambition of strategic positioning in terms of logistics, said the finance minister, Salaheddine Mezouar. – This article was first published by the Oxford Business Group on Aug. 11, 2009.
