Morocco: Leads Auto Industry in Africa Despite Covid-19

Thanks to Morocco' strategic location close to Europe, and the availability of good infrastructure, in addition to various commercial incentives, Morocco continues to attract more international investments in the auto industry sector, despite the epidemic situation and its effects on the global economy


Thanks to Morocco’ strategic location close to Europe, and the availability of good infrastructure, in addition to various commercial incentives, Morocco continues to attract more international investments in the auto industry sector, despite the epidemic situation and its effects on the global economy.


In many regions of the world, auto production has stopped and exports have been reduced. At the same time, Morocco has managed to maintain its leadership in the Middle East and North Africa in this sector, according to a recent report by Fitch Ratings.

The “Renault Morocco” group for the automotive industry has maintained its leadership with a 40 percent share of the market, producing 277,474 vehicles in 2020, in its two factories in Tangiers and Casablanca.


New investments

Before the end of 2020, Morocco government had signed an agreement to establish a factory belonging to the American Industrial Group “Advent ” of auto equipments, with an investment of nearly $19 million, creating 1,600 jobs and an export transaction number of about $73 million.

In 2021, Morocco signed a protocol of agreement with two Japanese cable industry groups Sumitomo and Yazaki, with the aim of establishing 4 factories in the auto sector in Tangiers, Kenitra, Meknes and Casablanca.

912 million Moroccan dirhams (about $103 million) is the total investment earmarked for these four new factories, providing 8,300 new jobs.

The Minister of Industry, Trade, Green and Digital Economy, Moulay Hafid El Alami, has confirmed that these two investments represent total confidence in the Moroccan production structure, which provides quality, performance and diversity, with promising developmental prospects to industrial investors. The minister also indicated during the signing of the agreements with the two international companies that Morocco actually has a manufacturing capacity of 600,000 cars per year, and considered one of the largest auto manufacturers globally.


Incentives for investors.

The Kingdom of Morocco seeks to encourage and attract investments in The auto industry By providing a set of motives to new investors, including tax paying exemption during the first five years from the date of project launch.

According to the economic analyst Mahdi Fakir, the incentives provided by Morocco within the context of the industrial acceleration plan (2014), include several measures such as tax exemptions and providing equipped industrial zones, aiming to transform Morocco into an industrialized country that attracts capital, have proven their effectiveness during This the economic crisis.

In a statement to “Sky News Arabia”, the economic analyst points out that the turmoil in global production chains, especially in Europe due to Corona virus repercussions, did not have an impact in Morocco, where auto manufacturing groups continued their industrial activities as usual .

In the time of this pandemic crisis, for industrial companies, production attractiveness has doubled, despite the decline of the economy due to the Corona virus precautionary measures, companies did not stop and continued to work“, explains the economic analyst.

Fakir considers that in addition to the Corona virus factor, which Moroccan economy have managed to overcome its constraints, there is another structural factor, which is the determination of investors to transfer their projects to countries that allow controlling production cost in auto industry, a sector characterized by intense competition.


Job opportunities

The flourishing activity of the auto industry in Morocco was reflected in the stability of foreign companies with a global reputation in different cities of the country, positively effecting the job market in the Kingdom, by providing job opportunities for tens of thousands of Moroccans, more than 147 thousand jobs have been created between the years 2014-2019. According to official figures.

In this context, Adel Rais, head of the General Confederation of Moroccan Enterprises in Tangiers, northern Morocco (the largest grouping of companies in the country), says that the auto industry, which started in the Kingdom 20 years ago, employs currently tens of thousands of workers and specialists, and provides job opportunities compatible with their professional formation.

“Morocco has furnished infrastructures and conditions of high quality to meet international investors requirements for industrial production, including a well qualified workforce and a suitable investment environment that helps raise the competitiveness of the auto industry”, stated Adel Rais to Sky News Arabia.

The president of CGEM considers that these international companies have in turn contributed to qualifying the Moroccan workforce of youth men and women enabling them to obtain jobs, and impel many of them to turn to various professional formation to keep pace with the development of the auto industry in Morocco. It should be noted that the auto and spare parts industry are among the most important poles of the industrial acceleration scheme in Morocco, since 2014, the auto industry sector has been at the top of the Moroccan exports, ahead of agriculture and phosphates.

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