Pushing for industry: Better connected transport infrastructure eases the export process


Given the need to create employment opportunities for its growing population and increase manufacturing output, authorities are aiming to establish new labour-intensive industries in the Eastern Region. For years, overall business conditions, including poor infrastructure, made attracting manufacturing companies a difficult mission. But with rising investment in logistics and a network of sector-dedicated industrial parks being developed across the region, a more inviting environment for new businesses is being created.

MED-EST: Under the Emergence Plan, which was launched in 2005, the government established a strategy to increase Morocco’s industrial infrastructure and enhance the level of its production units. As part of this, the Agency for the Development of the Oriental has created a region-specific industrial development programme. The national Emergence Plan resulted in the launch of the Med-Est project, which aims to capitalise on the improved accessibility brought about by the Tanger-Med port in the north by creating clusters dedicated to technology and industrial development as well as a brand new logistics and distribution site. The ultimate aim is to upgrade the ancillary networks and labour pool in the Oriental to allow it to compete more effectively in attracting foreign investment.

DRAWING INTEREST: The region’s industrial development has been minimal over the last few decades. According to a 2012 report by the French Chamber of Commerce and Industry in Morocco, the Oriental is home to a total of about 300 industrial companies employing around 7000 people. Most of these are located in Nador, which has a legacy of small-scale manufacturing, traditionally focused on construction materials. Despite the existence of a handful of big factories, such as Moroccan steel company Sonasid’s facility in Nador and Swiss cement manufacturer Holcim’s facility in Oujda, most of the region’s industrial outfits are small or medium in size. Traditionally, most industrial firms have been in the agro-industrial sector, which employs about 30% of industrial workers in the region.

“There is need for an industrial transformation. And one of the great advantages, besides our location, is that labour in the Oriental region is cheaper than elsewhere in Morocco,” Rachid Slisli, the director of the Oujda Chamber of Commerce and Industry, told OBG.

THE NEW NADOR PORT: Much of expected increase in industrial output over the coming years is set to originate from the agro-industrial sector, as the region works to add value to its agricultural exports. The Berkane Agropole industrial zone currently under development will house agro-industrial processing firms as a way to add value to the agricultural sector.

However, the government is also focusing on encouraging new industries to reduce the vulnerability of both output and employment for a handful of areas. As part of this, there is a move to expand transport infrastructure to boost export capacity in nontraditional areas, such as petroleum products.

While the port of Nador Beni Ansar is already in operation, the creation of a new seaport, Nador West Med, is under construction on an 850-ha plot of land located 30 km from the city of Nador on the Mediterranean coast. The first phase alone is set to cost Dh5bn (€444.5m). The new port will include a hydro-carburant storage zone to manage the transfer of energy exports to Europe, as well as a free trade industrial zone to attract local and foreign companies. There are also plans for a trans-shipment and container handling area, although it is still unclear if this will be built straight away or if a delay will be considered due to the region’s proximity to the larger Tanger-Med port to the west.

However, Nador West Med port is being billed as an improvement on existent infrastructure for the country’s north coast rather than a replication of developments elsewhere. “This project will not compete directly with Tanger-Med, but it will be a complement that will impact the region’s attractiveness,” said Ali Belhaj, the president of the regional council of the Eastern Region. Exporting industries will clearly benefit from having a fully operational port close by. Being in the Oriental increases operating costs because businesses are further from export points. “The port of Nador is underused today. For many companies, raw materials are shipped through Casablanca, which drives up transportation costs,” Nabil El Harti, the logistics director at Midi Peinture, told OBG. But this has been changing with improved connectivity. “Recent investments in road expansion have helped improve the region's links to our targeted export markets,” said Hamid Barda, the manager of Bled Conserves, an olive exporter based in Taourirt that sells 80% of its production overseas.

PARKING IT: To promote industrial development, the government is putting land aside and investing in basic infrastructure that can facilitate manufacturers to move into the region, providing turnkey facilities and encouraging clustering. The Med-Est industrial park in Selouane is being built 12 km from the city of Nador with a total investment of Dh285m (€25.34m). The project, which is the result of a partnership between MEDZ, a subsidiary of CDG Développement and the Nador Chamber of Commerce, Industry and Services, will initially include 142 ha of industrial plots with readily available access to electricity and basic amenities. The park is focusing on small to medium companies and relatively undeveloped secondary industries. Each plot is sized between 1000 sq metres and 5000 sq metres. The first section has been finalised with 72 ha of plots.

However, Med-Est is far from the only such facility in Morocco, with a number of new zones and parks under construction or already in operation in more traditional economic areas of the country. To improve its attractiveness to investors, the Selouane park aims to offer lower rent prices than those in other industrial areas. According to figures from Agence de l’Oriental, the basic price to rent a sq meter for industrial production will be €44 a year, lower than the €58 per year for a sq metre of industrial space in Casablanca or the average national price of €60 per year.

SERVING A MULTITUDE OF PURPOSES: Another industrial area, the Oujda Technopole, is working to become an anchor for the settlement of new businesses in technology-driven industries. With a total investment of Dh600m (€53.34m), the zone will eventually cover a total area of 500 ha, to be developed in different stages and with separate focuses. Within the Oujda Technopark is Clean Tech, an area dedicated to clean energy technologies. Also operational within the industrial area is the 22,500-sq-metre Oujda Shore, a Dh180m (€16m) IT business outsourcing area developed by the Ministry of Communications and managed by MedZ Sourcing, a MEDZ subsidiary that began operations at the end of 2012 and aims to take advantage of the region’s pool of young graduates to attract IT businesses.

State programmes are set to further develop workforce capabilities. Inside the Oujda Technopole, Morocco’s Bureau for Training and Employment Promotion will create two human resources training facilities, one for the energy sector and the other for IT and offshoring.

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The Report: Morocco 2013

Oriental chapter from The Report: Morocco 2013

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