Morocco - COUNTRY PROFILE
Geography
Located on the western shoulder of North Africa, Morocco's coastline borders both the Atlantic Ocean and the Mediterranean Sea. On the southern side of the strategic Straits of Gibraltar, the country is a mixture of high mountains, desert plateaux and rich coastal plains.
Morocco shares its boarders with Algeria to the east and Western Sahara to the south. There are also two small Spanish colonies at Ceuta and Melilla on the Mediterranean coast. Most of Morocco's population is concentrated in the cities of the north and north-west. The Atlantic coast is bordered by a fertile plain, while the Mediterranean seaboard is mountainous.
The climate is largely Mediterranean, becoming more arid and extreme inland. In contrast, the Atlas Mountains of the north, which rise to a high point with the 4165 metre Jbel Toubkal, provide a milder climate, wooded valleys and rivers. Morocco has important reserves of phosphates, iron ore, manganese, lead and zinc. According to official 1998 estimates, land use is divided up between 20.12% arable land, 2.05% permanent crops and 77.83% others.
Recent History
Morocco was colonised by the French and Spanish in 1912 after bitter fighting. An anti-colonial, nationalist movement sprang up first during World War II. Conflict during the 1950s led to France and Spain recognising Moroccan independence in 1956. Sultan Sidi Muhammad then established a constitutional monarchy under which the monarch had wide powers. In 1961, he was succeeded by Moulay Hassan, who became King Hassan II.
One of Morocco's longest running international disputes has been over Western/Moroccan Sahara. In the 1970s, thousands of Moroccans began to occupy this territory, which was under Spanish control until 1976. Morocco argued that this territory had originally been part of Morocco and should therefore revert to Moroccan control now that the Spanish were gone. Mauritania to the south argued a parallel case.
However, the Mauritanians withdrew their claim over the disputed area in August 1979, and Morocco occupied the rest of the territory not previously under its control.
In 1976, the Polisario Front began fighting a guerrilla war against Morocco in the Western/Moroccan Sahara, which it argues should belong to the native Saharawis. In September 1991, the UN negotiated a cease-fire - which is still holding - although this depended on a referendum regarding independence. However, the referendum has still not been held, and seems unlikely to be any time soon, as King Hassan II's successor, King Mohammed VI, stated on accession in 2002 he would "not renounce an inch" of Western/Moroccan Sahara.
In June 2001, the UN proposed a system of autonomy for Western/Moroccan Sahara within Morocco, with the referendum put off to the long term. Morocco supports the plan, though the Polisario front does not. The conflict has long soured relations with Algeria, which supports Polisario's cause. Since 1994, the land border between Algeria and Morocco has been closed. A recent rapprochement between the two governments seems likely to see the border reopened.
In July 2002, Moroccan troops took over the Parsley Islands, a group of tiny islets off the Moroccan coast claimed by Spain. The dispute that followed was resolved peacefully, with Spain rapidly reoccupying the islands. However, a certain tension in relations remains.
On the domestic front, King Hassan II started a period of political and economic liberalisation in the 1990s dubbed "Hassanian democracy", a process continued by his successor, King Mohammed VI. King Hassan died in August 1999.
Government and Politics
Major Political Players
King Mohammed VI: With Morocco's constitution giving him significant power, the king has pledged to make the political system more open, allow more freedom of expression, and support economic reform and regional decentralisation. A popular figure, he has also advocated giving more rights to women, which has been unpopular with Islamists.
Driss Jettou: Currently the prime minister, he is also a successful businessman in his own right known for his negotiating skills. He has been given a mandate for rapid economic and social change by the reform-minded king. Jettou was interior minister in the previous government. Liked by the business community, his appointment was criticised by some as he is not an elected deputy, but a royal appointee.
Mohammed Rachidi Chraibi: The king's top advisor and head of his parallel cabinet. Chraibi is also a former classmate of King Mohammed.
Officially described in the 1996 constitution as a democratic monarchy, Morocco's hereditary monarch has wide executive power. He can dismiss the government, dissolve parliament and sign international treaties. He also appoints regional governors and heads a "second cabinet" composed of former politicians, business leaders and army chiefs. This runs in parallel to the government and is widely known as the focal point for the Makhzen, the popular name given to the Moroccan establishment.
In 1997, a bicameral legislature was established, consisting of a 270-seat upper house or Chamber of Councillors, whose members are elected by an electoral college for nine-year terms. One-third of the members are renewed every three years. The lower house is the 325-seat Chamber of Representatives, members of which are elected by popular vote for five-year terms.
The government is headed by the prime minister, who is appointed by the monarch following legislative elections. The king also appoints the ministers of interior, foreign affairs, justice and Islamic affairs - often from outside party politics. The prime minister heads a 31-member cabinet known as the Council of Ministers, yet many of its appointments are made by the king rather than the prime minister himself.
Some 26 political parties ran in the September 27, 2002, legislative elections, which were widely hailed as the first truly democratic ballot in Morocco's history. Four main political blocs were evident. The leftist bloc includes the Socialist Union of Popular Forces (USFP); the former-communist Party for Progress and Socialism (PPS), led by Ismail Alaoui; the Leftist Unified Socialist Party (PGSU), led by Mohamed Bensaid Ait Idder; and the Socialist Democratic Party (PSD), led by Aissa Ouardighi.
On the centre-right is the moderate Islamist wing, there is the Istiqlal Party (PI), led by the veteran Abbes el-Fassi and the moderate Islamist Party of Justice and Development (PJD), led by Abdelkrim Khatib. More conservative still is the National Rally of Independents (RNI), led by Ahmed Osman, and the Constitutional Union (UC), led by Mohamed Abied.
Elsewhere, the pro-Berber parties include the Popular Movement (MP), led by Mohand Laenser; the National Popular Movement (MNP), led by Mahjoubi Aherdane; and the Social Democratic Movement (MDS), led by Mohamed Archane.
The September 27, 2002, ballot saw a number of innovations to the electoral system, including proportional representation in voting and a 10% reserved list for women candidates.
The ballot also saw a low turnout of 52%. More hardcore Islamist parties, such as Abdessalam Yassine's al-Adl wa al-Ihsana (Justice and Charity) party, called for a boycott. Justice and Charity is currently banned. There was also much fragmentation in the vote, with 22 parties out of the 26 claiming at least one seat.
The new government appointed by the King was formed with the USFP and PI as the main entities. Alongside them in the ruling coalition are five other parties, the socialist PPS, the nationalist PI, the centrist RNI and two Berber parties, the MNP and the MP. The moderate Islamist PJD, which trebled its vote to become the country's third largest political grouping, now forms the main parliamentary opposition.
Continuity is the keyword with the new government, since the USFP have been the ruling party before and three key ministers from the last government have also kept their seats. Mohamed Benaissa remains minister for foreign affairs, Fatallah Oualalou continues as finance minister and Mohamed El-Yazghi retains the post responsible for territorial development.
Population
Morocco has a youthful population, with some 32.6% under the age of 15 in 2004. However, the growth rate has slowed from a 2.4% high in the 1980s to 1.6% in 2004. Morocco's population was 32.2m in mid-2004. There is also a significant Moroccan population abroad, some 1.7m in 2002, most of whom live in Spain or France. The expatriate European population, once large in cities such as Tangier, was down to around 60,000 in 2003.
One-third of the population is Berber. Pressure for Berber linguistic and cultural rights has led to the broadcasting of programmes in Tamazight and the establishment of the Royal Institute of Amazigh Culture in 2001.
Economy
Since the early 1990s, Morocco has embarked on a major economic restructuring programme aimed at raising living standards, cutting unemployment and boosting growth. In pursuit of these goals, successive governments have made efforts to attract domestic and overseas investment, which has obliged them to tackle a string of other problems - such as reducing red tape and corruption, updating the financial system and privatising telecommunications, water and power.
Meanwhile, rolling back the state in terms of cutting public expenditure has also been a priority, alongside labour market reform. Both of these have been praised by international bodies such as the IMF and World Bank, but have led to frequent confrontation between the unions and the government, which since 1998 has been centre-left dominated.
The IMF, World Bank and Paris Club backed structural adjustment programmes followed by the administration first seeing dirham convertibility established for current account transactions in 1993. This marked the beginning of a phased restructuring of the financial sector, which from 1994 was joined by a phased liberalisation of basic item imports. In 1995, the investment code was reformed, and in 1996 an Association Accord was signed with the European Union (EU). This came into force in 2000, with the EU long established as the country's main trading partner - taking some 75% of Morocco's exports and providing 60% of its imports. France alone accounts for about a quarter of the country's imports and a third of its exports.
Meanwhile, the privatisation programme gained momentum in 1999 and 2000 with the sale of a 35% stake in Maroc Telecom (MT), the telecommunications provider. Morocco was one of the first Arab countries to begin a programme of state sell offs, and it has one of the most ambitious programmes, with 114 enterprises identified for sale in 1993. However, progress has been slow since then, and the programme stalled again soon after the MT stake sell off. It is now hoped that the sale of a further 16% stake in MT, the state tobacco company, several sugar firms and a clutch of power generation and water management facilities will revitalise the programme.
Revenues from sell offs may also go to addressing a key problem for the Moroccan government - reducing the budget deficit. In 2002, this was estimated at around 6.1% of GDP. Another difficulty is the key agricultural sector, which was depressed by drought in the late 1990s, seriously holding down economic growth overall. Rainfall has long been a key factor in the country's economic health. While the government is trying to shift economic activity toward industry and commerce, agriculture still remains crucial, employing 40% of the workforce, although producing only 12-16% of GDP in recent years.
The country's largest industrial concern is the phosphate giant, OCP, with probable phosphate reserves in the country amounting to 58bn tonnes - the largest in the world. A major part of these reserves is located in the Western Sahara, with the mine at Boucraa of primary importance. There is also a significant allied phosphate derivatives industry producing chemicals and fertilisers. Morocco is also the world's largest exporter of both raw phosphates and processed products.
Morocco's energy resources are small, with hydroelectricity limited by water shortages and coal almost exhausted. Discovery of oil deposits in the Haut Plateau region in 2000 did give a brief boost to hopes that there might be significant reserves in country, but little has been found since, although there is still some hope that off shore reserves may be significant.
Manufacturing currently accounts for some 18% of GDP and employs some 20% of the workforce. Traditionally, the sector has been dominated by clothing and textiles, but is now a key target for government efforts to diversify, increasing employment and foreign investment.
In 2001, in Casablanca the first of four planned technology parks opened, with a number of foreign electronics firms - such as Thomson, Microsoft, Compaq and Oracle - making investments in Morocco in recent years. Meanwhile, contributing some 52% of GDP in 2000, the services sector is now large and well developed, employing some 45% of the workforce.
In the financial sector, the central bank is the Bank al Maghrib, with an interbank foreign exchange market set up in 1996, although capital movements in general remain partly restricted. The four largest Moroccan commercial banks are Banque Commerciale du Maroc (the largest), Credit Populaire du Maroc (or Banque Populaire), Banque Marocaine du Commerce Exterieur (BMCE) and Wafabank. In addition, the state has a 33% stake in the Banque nationale pour le developpement economique.
Since May 2000, the Casablanca Stock Exchange (CSE) has also been listed by Morgan Stanley Capital Markets, with the CSE one of the few regional bourses to have zero restrictions on foreign participation. With some 55 listed companies, it remains small, with an MCAP of around $10m.
Although most of the country's economic activity remains concentrated in the Casablanca-Rabat axis, efforts are also being made to develop the country's regions. In August 1999, the government announced an initiative to channel revenue from its successful GSM license auction into a fund that would be used to develop housing projects in remote areas. Per capita GDP in places such as the Western Sahara often drops to below $200, illustrating the depth of the regional problem.
Tourism is also a major industry for Morocco, and a major source of foreign exchange. The government also wants to see visitor numbers keep rising - 2.5m tourists came in 2003 - and began its "Plan Azur" in 2003, aimed at developing tourism on the Mediterranean coast.
Formidable long-term challenges for the government also include preparing the economy for freer trade with the EU. With a literacy rate of only 51.7% and an unemployment rate of 19% the government is focusing on improving education in order to boost living standards and job prospects for Morocco's youth.
