VZCZCXYZ0003
PP RUEHWEB

DE RUEHRB #0190/01 0641700
ZNR UUUUU ZZH
P 051700Z MAR 09
FM AMEMBASSY RABAT
TO RUEHC/SECSTATE WASHDC PRIORITY 9769
INFO RUCNMGH/MAGHREB COLLECTIVE
RUEHCL/AMCONSUL CASABLANCA 4528

UNCLAS RABAT 000190 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/MAG AND EEB/TPP/BTA (EGAN) 
STATE PASS USTR (BURKHEAD) AND 
CLDP(TEJTEL AND ELKSTOUF) 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EIND EINV MO
SUBJECT: A NEW APPROACH FOR MOROCCAN EXPORTS 
 
REF: A. RABAT 0171 
     ¶B. RABAT 0119 
 
¶1. (SBU) SUMMARY: A new national export strategy to be 
unveiled this month seeks to address a key gap in the recent 
improvement of the Moroccan economy - the continuing lack of 
competitiveness of Morocco,s export sector.  Non-phosphate 
exports were essentially flat in 2008, and 2009 augurs worse. 
The international downturn in trade has already impacted 
traditional Moroccan specialties such as textiles and auto 
parts.  The new approach tackles the issue by integrating 
export promotion with specific sectoral strategies, while 
also giving a facelift to the country,s export promotion 
apparatus. On the front lines in advancing the new strategy 
is "Maroc Export," the renamed national center to promote 
exports, whose director recently outlined for us his 
ambitious attempt to match Moroccan producers with 
international clients. END SUMMARY. 
 
--------- 
NEW LOOK 
--------- 
 
¶2. (SBU) A Booz Allen Hamilton study ordered in 2008 by the 
Ministry of Foreign Trade confirmed what other analysts have 
long argued:  Morocco must enhance its capacity for 
international product promotion and marketing in order for 
Moroccan exports to be competitive in the international 
market. Following the release of the study, Morocco moved to 
revamp its hitherto "fragmented" approach to export 
promotion, beefing up its export promotion agency, renaming 
it "Maroc Export," and entrusting it to a dynamic, young, and 
U.S.-educated Moroccan diplomat, Saad Benabdallah, a former 
Economic Counselor in Paris. 
 
¶3.  (SBU) The rebranded agency is a key component of a new 
overall export strategy.  As outlined by Minister Maazouz at 
a conference in Casablanca last week, the government aims to 
increase non-phosphate Moroccan exports from 20 billion to 26 
billion USD over ten years,  through aggressive marketing and 
promotion. The new plan, the Minister stressed, will be 
integrated with other internal reform efforts already 
undertaken to diversify export offerings and strengthen 
Morocco,s hold on niche markets.  One of these reform 
efforts, the National Pact for the Emergence of Industry, was 
launched on February 13 in Fez.  The six year Pact 
(2009-2015) will allocate 1.4 billion USD to boost the 
competitiveness of Moroccan businesses through promotion (128 
million USD for investments and exports), training (477 
million USD for training centers and assistance), 
infrastructure (193 million USD for industrial zones and 
integrated industries), investments (341 million USD for 
assistance and offshoring) and the support of small- and 
medium-sized businesses (273 millions USD for financing). 
 
¶4. (SBU) In a recent meeting, Benabdallah outlined the ways 
in which "Maroc Export" will seek to achieve the Minister,s 
vision.  In addition to "rebranding" and modernizing the 
agency,s headquarters, Benabdallah dismissed two-thirds of 
his staff, and is moving to hire U.S.-educated, 
English-speaking replacements.  If we want to be taken 
seriously, he noted, we have to look serious and able to meet 
the demands of any potential buyer and compete with any other 
country. 
 
------------ 
NEW STRATEGY 
------------ 
 
¶5. (SBU) The new Moroccan approach to exports is based on 
three main principles, Benabdallah explained: promotion, 
marketing, and institutional communication.  Promotion for 
Maroc Export means getting out and becoming known. Maroc 
Export has the budget, he observed, to send serious companies 
interested in reaching out to new markets to trade fairs. 
Sourcing missions are another way to market the brand 
overseas.  Working with the USAID-sponsored New Business 
Opportunity Program, for instance, Maroc Export organizes 
these missions to highlight success stories. Lastly, through 
institutional communication, Maroc Export will bring buyers, 
industrials, journalists and anyone interested in doing 
business to Morocco to get a new picture of today,s Morocco. 
 If we have the product, whether it is leather, textile, or 
agricultural, Benabdallah asserted, we are willing to do what 
it takes to get buyers to seriously consider Moroccan 
products. 
 
----------- 
NEW MARKET 
----------- 
 
¶6. (SBU) The GOM officially considers the U.S., along with 
Russia and Gulf Cooperation Council countries, as "mid-range" 
potential markets for Moroccan Exports.  Benabdallah told us 
that he has a different vision.  The U.S., he argues, must be 
one of the "strategic" markets for Morocco, along with more 
traditional export destinations like France, Spain, Germany, 
Italy and the United Kingdom.  Although Moroccan exporters 
are most comfortable dealing with such traditional partners, 
he argued there is great promise in the U.S. market and Maroc 
Export will focus its efforts on reaching out to it.  With a 
new staff that understands U.S. business culture and a new 
strategy to market Morocco, Benabdallah foresees 3-5 percent 
annual growth in exports to the U.S. within the next five 
years.  We need to educate people, he observed, about the 
advantages of the US-Morocco Free Trade Agreement (FTA) and 
dissipate the fear of exporting to the U.S.  If the global 
economic crisis has taught Morocco anything, Benabdallah 
asserted, it is that it needs to diversify and that it cannot 
rely on the same old strategy. 
 
----------------- 
SAME OLD SKEPTICS 
----------------- 
 
¶7. (SBU) Benabdallah's notwithstanding confidence, some 
observers question whether the new strategy will be enough to 
significantly increase the volume of outgoing trade.  A 
number of such skeptics voiced their criticism at the 
conference where Maazouz unveiled the new vision last week. 
Abdellatif Belmadi, President of the Moroccan Exports 
Association (Asmaex), agreed that that promoting exports is 
essential, noting that he proposed a similar plan two years 
ago.  The situation is different now, he argued, and Morocco 
needs to thoroughly reflect on how the economic crisis is 
affecting each exporting sector.  The GOM's optimistic 
reports and "preventative" reforms have not sufficiently 
analyzed the crisis, he added (Reftel B).  For Belmadi, in 
order to have a truly innovative approach, Moroccan exporters 
must consider the effects the crisis has had on their 
businesses and recalibrate what they can offer international 
markets, since they currently do not have the capacity to be 
competitive in certain markets, particularly the U.S. 
 
¶8. (SBU) Other critics, while sharing the view Morocco needs 
to access new markets, questioned whether the U.S. is the 
appropriate target.  The first step to diversifying Moroccan 
exporting markets, argued Ambassador Hassan Abouyoub, former 
Minister of Foreign Trade, is to seize the opportunities 
available in African markets.  Abouyoub suggested that 
Moroccan exporters should profit from relationships developed 
by the Moroccan banks and the national airline already 
working in certain African countries.  Richard Newfarmer, 
Economist and Special Representative to the UN and the World 
Trade Organization for the World Bank in Geneva, however, 
suggested that Morocco's export strategy must tap into the 
Asian market in order to achieve success.  "If your export 
promotion strategy is successful", Newfarmer told Maazouz, 
"in the next 10 years your street signs will also be written 
in Mandarin to accommodate your new market." 
 
---------------- 
NECESSARY CHANGE 
---------------- 
 
9.(SBU) COMMENT: A new, more integrated approach to promoting 
exports is a necessity here, given the sector,s continuing 
weakness and the lack of coherence of past promotion efforts. 
 The new effort comes in an uncertain international climate, 
which is evolving rapidly.  Maazouz,s vision is likely not 
the last word on the subject.  In particular, forthcoming 
reports on Morocco,s experience with its numerous free trade 
agreements, which will be released by Morocco,s General 
Confederation of Enterprises (CGEM) in mid-March, will 
undoubtedly shape the debate.  Whatever the final shape of 
the overall plan, however, Maroc Export,s new modern face 
and access to resources already mark an important shift.  END 
COMMENT. 
 
 
***************************************** 
Visit Embassy Rabat's Classified Website; 
http://www.state.sgov.gov/p/nea/rabat 
***************************************** 
 
Jackson