Morocco: Key role for aeronautics

NEWS

12/02/12

Efforts are gathering pace in Morocco to boost growth in key, labor-intensive manufacturing sectors, including electronics and aeronautics, which will allow the country to increase exports and diversify its traded products, while improving employment. The move forms part of a broader, long-term bid to increase trade and modernize the industry sector, which is being driven forward under Morocco’s National Pact for Industrial Emergence 2009-12 (Pacte National pour l’Emergence Industrielle, PNEI) initiative, a plan that aims to create 220,000 new jobs in the sector by 2015 and boost GDP by Dh50bn (€4.45bn) and exports by Dh95bn (€8.45bn).

Morocco’s plans to strengthen its high-value manufacturing sectors are set to receive a boost when a new €500m industrial park, earmarked for the aerospace, defense and on-board electronic safety industries, begins operating in mid-2013.

Located in Nouaceur, 30 km from Casablanca and close to the city’s Mohammed V International Airport, the Midparc Casablanca Free Zone will house 250 industrial units over 124 ha, including a component manufacturing plant for Canadian Bombardier, which will be the first firm on site to open its doors. Midparc Company, which is owned by real estate development agency Medz, and three industrial companies specializing in aeronautics and electronics – ARSCO, CENAL and MASPIN – will act as the zone’s designers, promoters, developers and administrators.

For the first five years of business, industrialists are set to benefit from a zero corporate income tax regime, which will rise to 8.75% for the next 20 years and then increase to 17.5%. Companies will also be exempt from VAT and Customs duties, and repatriation of profits and capital will be permitted.

Aeronautics has attracted considerable foreign direct investment in recent years, despite the global economic crisis and regional instability. Around 100 companies in Morocco currently operate in the sector, employing around 10,000 people, with much of the workforce based in component manufacturing, engineering and services. A number of companies have been present in the country for over a decade, including the French component producer Le Piston Francais and French Safran, operating through a number of subsidiaries including Matis, Aircelle, Snecma, Sagem and Teuchos. The number of firms is expected to rise as global demand for aircraft components increases, with the Midparc initiative expected to create around 10,000 much-needed jobs.

Data from Morocco’s aerospace trade group, the Group of Moroccan Aviation and Aerospace Industrialists (Groupement des industries Marocaines Aéronautiques et Spatiales, GIMAS), shows that aeronautics generated Dh5.2bn (€468m) in export revenues in 2011, up from Dh4.7bn (€424m) in 2010. Exports in wiring, manufacturing and maintenance accounted for 82% of total aerospace revenues, according to a report released by the Ministry of Finance in September 2011.

Bombardier expects to invest $200m (€157m) in establishing its plant over the next eight years and create around 850 jobs as it looks to harness Morocco’s competitive labour and transportation costs. The average monthly wage in Morocco is €256, compared to €265 in Tunisia, €337 in Turkey and €1003 in Spain. As for exports, the cost per container runs about €549, compared to Tunisia’s €606 and Turkey’s €775. The company plans to set up a temporary unit at the beginning of 2013 in Casablanca’s aviation industries zone (Aéropole), across from the MidParc site, to work out of until the industrial park opens.

An emphasis has also been placed on the establishment of training facilities in line with Morocco’s plans to ensure that advanced manufacturing plays a part in creating jobs and addressing the issue of rising unemployment. The government, in partnership with the French Union of Metallurgical Profession Industries (Union des Industries et des Métiers de la Métallurgie), has earmarked the Moroccan Aerospace Institute (Institut des Métiers de l'Aéronautique), which opened its doors in May 2011 in Nouaceur, for a central role by providing vocational training to operators, technicians and middle management in aviation and aerospace professions. About 450 people are expected to finish courses, which can last up to 11 months, by the end of 2012, and the institute hopes to train 800 people annually by 2015.

The government will now be looking to other international companies to follow in Bombardier’s footsteps, hoping they will also be attracted by Morocco’s competitive advantages and proximity to Europe. The arrival of new firms under the PNEI will allow the country to benefit from foreign expertise and technology transfers, helping to generate an estimated 15,000 new jobs by 2015, according to the Ministry of Finance, and paving the way for Morocco to build its exports while assuming a greater role in the global aerospace industry.

Article published by oxford business group

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0 #1 RE: Morocco: Key role for aeronautics — mbt 2012-12-04 12:18

Morocco is trying to get and present itself as a hub for all things to everyone, the transport, the ports, the minerals, the oil, the energy from sun, the high-tech industries, but is it practical? So a small company, though much welcomed to provide the jobs for the locals, is not enough when you have thousands and thousands of young and jobless. The Western companies would not give it two spanners if there is no tax breaks and all sorts of incentive, retaining them is even more difficult because of the offers elsewhere.

China and India and indeed Europe and America does not rely on selling to outside its boundary, first it produces for home consumption, it has administration for startups and makes easy to set up companies, two minutes UK, try that for Morocco S.A.R.L! The other factor, and it is a big factor is the political stability, yes there is a stability now but about tomorrow?

If Morocco is to provide jobs for its young population it has to look within. Do away with no rights for the working population, penalize the companies (most) exploit the eager worker looking for jobs, monthly salary of 1500 dhs for most without any worker rights is totally unacceptable. Make it easy for startups, do away with redtape and more.

Aeronautics and automobiles and desert electricity is just that headlines.

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