Morocco Trade

Subchapters:

  • Business Relationships
  • Foreign direct investment
  • FTAs ​​and Treaties
  • Development Cooperation
  • Prospective fields of study (MOP)

Business relations

Trade relations with the EU

The European Union is Morocco’s largest trading partner. This situation is due to two basic factors. Historical and geographical. The Kingdom of Morocco had and still has close ties to the European continent. The main trading partners are Spain and France. Both countries previously administered parts of Morocco through protectorates. Morocco’s geographical location allows for very easy movement of goods from Europe and back. Mainland Spain is only 14 kilometers from Morocco. The largest African port, Tangier Med, was built in the north of Morocco in recent years. The latter mainly ensures the export of passenger cars manufactured in Morocco to Europe.

Morocco has a long-term negative trade balance with the European Union. The reason is the import of products with a higher added value. Apart from the mentioned cars, agricultural products are also exported in the opposite direction. Morocco has long been striving to increase its export capacities and especially products with a higher added value.

2017 2018 2019 2020 2021
Exports from the EU (million EUR) 21,484.50 22,480.90 23,287.90 20,034.50 25,130.50
Imports into the EU (million EUR) 14,355.60 15,369.40 16,322.10 15,138.70 17,978.90
Balance with the EU (million EUR) -7 128.8 -7 111.5 -6,965.8 -4,895.8 -7 151.6

Source: European Commission

Trade relations with the Czech Republic

The Czech Republic has a long-term positive trade balance with Morocco. Morocco is the second largest trading partner of the Czech Republic on the African continent. A slight decrease in trade exchange occurred as a result of the Covid-19 pandemic. In 2021, mutual trade began to grow again and exports to Morocco from the Czech Republic recorded one of the largest percentage year-on-year increases worldwide.

2017 2018 2019 2020 2021
Exports from the Czech Republic (billion CZK) 4.2 8.7 9.9 7,8 ON
Imports to the Czech Republic (billion CZK) 7.4 4.8 4.8 5.2 ON
Balance with the Czech Republic (billion CZK) 3.1 -3.9 -5.1 -2.6 ON

Source: businesscarriers.com

Trade relations with countries outside the EU

In the past, the Kingdom of Morocco has concluded a number of trade agreements with countries and regions outside the EU. The limit of significant trade agreements is the FTA with the USA valid since 2006. Other trade agreements are concluded with Turkey, Jordan or the UAE.

2017 2018 2019 2020 2021
Exports from countries outside the EU (million EUR) 340.6 2,564.1 1,887.6 3,512.9 5,782.7
Imports to countries outside the EU (million EUR) 24,067.1 28,413.5 26,983.5 22,708.8 31,823.1
Balance with non-EU countries (million EUR) -23,726.5 -25,849.4 -25,096.0 -19,195.9 -26,040.4

Source: EIU, Eurostat

Foreign direct investment

Despite the COVID-19 pandemic, FDI inflows to Morocco have remained stable. In 2020, FDI was estimated at USD billion. The largest investors in the country are France, followed by the United Arab Emirates. Also Great Britain and Spain.

A large amount of investment flows into the construction industry and the purchase of real estate.

For Czech companies, Morocco offers a wide range of foreign direct investments. In this area, there are promising fields such as the defense industry or the automotive industry, where some Czech companies are already active.

FTAs and treaties

Treaties with the EU

In 1996, an association agreement was signed between the Kingdom of Morocco and the European Union, which entered into force in 2000. A sectoral agreement focusing on agriculture was also signed between the two partners in 2021. Thanks to the agreement, liberalization was introduced for a number of agricultural products, including those originating from fisheries. In 2013, negotiations on the so-called Deep and Comprehensive Free Trade Zone began. The last round of negotiations took place in 2014 and for the time being the negotiations were suspended at the request of the Moroccan side.

Contracts with the Czech Republic

The Czech Republic has an agreement with Morocco on the promotion and protection of investments from 2001, to which an additional protocol was adopted in 2010. In 2001, an agreement on the avoidance of double taxation and the prevention of tax evasion in the field of income taxes was also signed. In 2018, an agreement on economic cooperation between the Czech Republic and Morocco was signed.

Developmental cooperation

The Kingdom of Morocco is not among the priority countries for foreign development aid. In Morocco, in 2018, a small local project was implemented in the village of Amnougar, where a water reservoir was established, which enables the irrigation of adjacent agricultural land using rainwater. In 2021, a humanitarian donation will be provided in response to the Covid-19 pandemic within the framework of the Restricted Monetary Donations tool for the Mohammed VI University Hospital. in Marrakech.

Prospective fields of study (MOP)

ICT

This sector represents something like 6% of Morocco’s GDP, half of which is telecommunications. Since 2020, the digitization of state administration has been accelerated as a response to the Covid-19 pandemic. E-commerce has also seen great growth. Related to this is the increased demand for Cloud Computing, Data management, Big Data, SaaS, cyber security solutions and others.

Defense industry

National security is one of the priorities of the Moroccan administration. Morocco’s geographic location at the crossroads between Europe and Africa brings with it a number of threats, including illegal migration and smuggling. To this end, there is an increased demand from Morocco for border control equipment, integrated monitoring and surveillance solutions, radars and scanning equipment. In 2022, the Moroccan Ministry of Defense should have a budget of around 75 billion crowns, i.e. roughly 5% more than in 2021.

Agricultural and food industry

Almost 45% of the population is employed in agriculture. This sector contributes 14% to GDP creation. In 2020, the government’s Green Generation 2030 strategy was launched. The goal of the strategy is to build modern agriculture and reduce the risks of climate change on production. Opportunities are in solutions for precision farming or smart farming.

Automotive

The automotive industry has been one of the drivers of the Moroccan economy in recent years. Morocco produces 700,000 passenger cars annually and is the number one on the African continent in this regard. The sector employs 180,000 people, and production is exported to 74 countries around the world. Morocco has the ambition to become an important world center in the automotive industry in the future. The current options for Czech companies are in the import of components, e.g. wheels, lighting, cabling and other products in the OEM mode of automotive parts. Investments within supply and sub-supply chains are also opportunities.

Healthcare and pharmaceutical industry

Healthcare continues to be one of the promising sectors of the Moroccan economy. The importance of investments in this sector was shown in 2020 by the Covid-19 pandemic. At the time, the Moroccan administration decided to build more hospital facilities in remote parts of Morocco where health care was insufficient. Extensive investments should continue in the coming year. There is a high demand for both consumable medical supplies and medical equipment for newly emerging hospitals.

Morocco Trade