Restructuring is a key part of Morocco’s ambitious plan to expand of the tourism industry, encompassed in the Vision 2020 programme. As the government continues its efforts to increase tourism numbers, diversify target markets and raise the quality of service and infrastructure, important elements of sector governance will be handed down to regional authorities. At the same time, the creation of a new central tourism authority should have a noticeable impact on sector growth in the medium to long term.

The transition is bound to take a few years, as a number of the existent institutional agencies that have so far been based in Rabat are shifted over to the regional level. But the government hopes that the overall result will make the implementation of tourism plans more region-specific, thus enhancing the sector’s overall economic impact.

LONG-TIME COMING: The move is in line with a wider state agenda. For several years now, the government has been implementing a regionalisation programme that is giving more decision-making powers to each of the country’s 16 regions. It is natural that a similar move would eventually impact the management of the tourism sector, which remains one of the main drivers of the Moroccan economy and an important foreign exchange earner. Moreover, the new initiatives under Vision 2020 may help ensure that tourists both stay in the country longer and venture out beyond simply traditional destinations, such as Casablanca or Marrakech. “Holidays spent in Morocco need to be longer,” Abdellatif Seddiqi, the president of hospitality investment fund H Partners, told OBG. “Now, people spend around three days in Marrakech or two days in Casablanca. People need to be encouraged to stay longer than that. Also, the return rate is very low, estimated at 6-7% of people that visit and come back. For some of our competitors, this rate has exceeded 20%.”

A NEW AUTHORITY: A central facet of Vision 2020 move is the creation of the new High Authority for Tourism (Haute Autorité du Tourisme, HAT), which will comprise government, regional and the private sector players. Alongside this, to support the transfer of centrally held competencies to the regions, the government will also create Tourism Development Agencies (Agences de Développement Touristique, ADTs) in each of the country’s eight tourism regions.

Existing delegations of the Ministry of Tourism as well as the regional tourism councils will be absorbed into the new ADTs. The main objective of this revamping of administration in the tourism sector is to make sure policy and resources are adapted and better tailored to each of the country’s regions.

“This is a good way to make authorities in each region responsible for attracting investment and tourists to their area,” Fouad Lahbabi, vice-president of the National Tourism Federation, told OBG. Each of the country’s eight tourism regions will be in charge for developing its own tourism products, estimating its resource needs and convincing potential investors of its specific strengths and opportunities. The new plan also aims to create one regional tourism school in each of the eight tourism zones to assure enough qualified future employees.

REORGANISNG: In a way, the new structure will treat each region as an independent tourism organisation, by encouraging specific regions to enhance their promotional and marketing efforts and develop their existing infrastructure into new tourism products. But it is unclear at this stage what effect the change will have on competition between the different regions to attract investment. Also uncertain is what role and means individual regions will have on promoting themselves abroad and how will these be integrated into the marketing of Morocco as a whole.

The move will eventually see the transfer of activities from existing tourism bodies on to the regional ADTs. For example, the existing Société Marocaine d’Ingénierie Touristique, whose current mission is to attract and channel tourism investment across the different regions of the country and develop Morocco’s tourism projects, will eventually shift some of its roles down to the ADTs. However, the transition is expected to be done gradually, as not all regional authorities will be created at the same time.

The first two ADTs, in Marrakech and Agadir, are set to be created by the end of 2013. The remaining six will be opened at varying points between 2014 and 2018. Marrakech and Agadir, the two most mature tourism markets in the country, will lead the way in testing the new system, giving the state time to smooth out potential problems before rolling out the reshuffle across the board.

REGULATORY ADJUSTMENTS: Regulatory changes to allow for the creation of the new tourism government bodies still need to be implemented before the first ADTs can be opened.

The ADTs will have the legal status of public institutions, under the direction of the Ministry of Tourism and the HAT. However, their management boards will be composed of public representatives as well private ones. A representative of the electorate of each region will also be part of the agencies, in order to ensure adequate local input.

At the beginning of the transition, ADTs in mature markets such as Marrakech and Agadir will be financed through a combination of central government money as well as support from the regional councils. For the remaining regions, however, the newly created ADTs will be 100% state-financed. Long-term financing plans for the new regional tourism bodies have still not been decided.

“The delegations of the Ministry of Tourism and personnel have always been financed the state, so these means will most likely be shifted into the new ADTs,” Abdelaziz Samim, director of the National Federation of the Hotel Industry, told OBG.

PRIVATE VS PUBLIC: Although the rearrangement of sector governance is being generally welcomed by operators, the issue of balancing private and public influence within the future HAT remains a contentious issue for some industry experts. The HAT is expected to be managed by a board of directors that will be made up of 20 different representatives from the public sector, but have only between seven and 10 members from the private sector.

“The main problem I see with the creation of the new HAT is that there is a strong prevalence of state representatives compared to the private sector representatives. We don’t think that the government can promote a tourism product as well as the private investor that owns it, has put money in it and expects to get a profit,” Lahbabi told OBG.

Indeed the government has previously stepped back from being directly involved in managing tourism infrastructure, favouring private sector ownership. There was a time when the government owned several hotels under the administration of the National Tourism Office, but the state eventually decided to exit the business, selling all of its hotels to the private sector. “There is a danger that if too much government weight permeates into the new structures, the promotion of the expansion of the sector might slow down,” Lahbabi said.

OTHER CHALLENGES: Another challenge might come from implementation of the new regional agencies. With several ADTs being created swiftly and others set to be opened further down the line, there is a danger of a two-speed management system developing, with associated redundancies. This could create added bureaucracy, slowing down the establishment of infrastructure and the implementation of policies critical to expand the reach of the sector to undeveloped parts of the country.

The restructuring of the governance system for the tourism industry will take time. But the results might provide the sector with a better chance of exploiting regional strengths as well as distributing the economic benefits of tourism more evenly across the kingdom. The government also hopes that with regions securing investment directly, they will be able to adequately match future infrastructure projects with the local needs specific to their offerings.