Kingdom ofMorocco WT/TPR/S/8
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V. TRADE POLICIES AND PRACTICES BYSECTOR
(1) Overview
1. Upuntiltheendofthe1980s, Morocco 'strade relations withtherestoftheworld hadthree
main features: thelimitations offoreign participation intheactivities ofcertain sectors (socalled
"Moroccanization"), animport substitution policy, particularly inrespect ofagricultural products, (the
foodself-sufficiencypolicy,forexample),andpromotionofexportsofmanufactures,particularlytextiles
andclothing.
2. Thedropintheworld price ofphosphate, thecountry 'smain export, andfrequent drought
contributed toashiftineconomic policy. Currently, foreign participation isnotonlywelcomed but
actively encouraged. Inviewofthecommitments made inthecontext oftheWTO andtheobjectives
ofitsnewfoodpolicy (food security), Morocco isgradually eliminating quantitative restrictions on
imports ofagricultural products (Section IV.2(vii)). Thispolicy suggests thatoncethereplacement
oftariffbarriers bytariffequivalents hasbeencompleted, agricultural primary products andby-products
arelikely tobeheavily protected bytariffs. However, inaccordance withitscommitments under the
WTO Agreement onAgriculture, likeother participants, Morocco willhavetolower thelevels oftariff
equivalents. Chart V.1andTable AV.1 show thestructure oftariff protection ofthemajor products
groups for1995.
3. Theemphasis placed onjobcreation andtechnology transfer intheformulation oftradepolicy
seems toberesulting intheautomatic protection ofsectors where prospects forexport andimport
substitution arethought tobegood. Thevarious charges placed onexports during the1980s have
hence beenabolished. Production ofgoods withhighdomestic value added isencouraged.
4. Aneffort isbeing made toopenuptheservices sector toforeign participation. Prompted by
policy ofpromoting exports, liberalization ofthissector willconsist notonlyopen upsome ofthe
mainbranches (tourism, telecommunications andbanks) toinvestment inforeign human andmaterial
resources butwillhelptomake export industries more competitive byreducing theirindirect costs.
Road transport isoneofthebranches where foreign participation isnotenvisaged.
5. Under theWTO Agreement onTrade inServices, Morocco 'scommitments aresubstantial
intourism, telecommunications andsome financial services, butlimited ininsurance andinternational
roadtransport amongst other sectors.WT/TPR/S/8 Trade Policy Review
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Kingdom ofMorocco WT/TPR/S/8
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(2) Agriculture, fishing andrelated activities
(i) Characteristics
6. InMorocco, agriculture occupies approximately 40percentofthetotalactive population and
80percentofrural workforce. Itscontribution toGDP formation, slightly lessthan20percentin
thelasttwodecades, hasdropped andnowaccounts foronly15percent,largely asaresult ofdrought.
7. Morocco 'smain crops arecereals, particularly wheat andbarley. Atotalareaof9million
hectares isgiven overtoagricultural production, more thanhalfofittocereals. Apart from fruits
andvegetables forexport, crops include beet, sugar cane, olives andtomatoes. Some farmers raise
bovine animals, sheep andgoats andalmost 30percentofthecountry 'stotalsurface areaisusedfor
grazing.
8. Modernfarmscoverapproximately1millionhectaresandproducewine,citrusfruits,vegetables
andcereals. They account forsome 25percentofagricultural output (80percentofdomestic wine
andcitrus fruits, onethirdofvegetables and15percentofcereals) and80percentofagricultural
exports. Other types offarmusetraditional methods andgrow crops largely forfamily consumption;
more thanonethirdoffarmers grow subsistence crops.
9. Lands areoften inherited andfarmed bythefamily. Parcelling hasbeenaccelerated bythe
rateofpopulation growth: only1percentoffarms arelarger than50hectares. Partoftherural
population works onfarms forwages. Thegovernment 'sagrarian reforms affected irrigated areas
orareas where development projects were under way.
10. Approximately 10percentofcroplandisirrigated. Farmers bear40percentofirrigation
costs. Fertilizers areusedverylittle; theStatestopped subsidizing them in1991. Morocco hashad
frequent droughts since theearly 1980s. Asaresult, andalthough afoodself-sufficiency policy has
beenimplemented throughout theperiod, thecountry imports substantial quantities ofcommodities,
particularly wheat, oils,sugar andmilk. Apart frominthedrought years, however, theshare offood
products intotalimports hasdropped steadily. Itfellfrom20percentintheearly 1980s tolessthan
15percentintherecent years withnormal harvests. Thereason forthisisthatproduction hasimproved
inthemodernized areas which haveirrigation.
11. Theagricultural sector 'smain assets areanearly Spring andhence early crops, andthefact
thatEurope isclose andhashigher labour costs. Morocco exports fruits (citrus fruitinparticular)
andvegetables, either fresh orcanned, including tomatoes, courgettes andbeans. There iscurrently
aboom inexports ofcut-flowers. Taken alltogether, plant products account forapproximately
15percentofthecountry 'sexports earnings.
12. Activities inthefishing sector (including financial compensation under fishing agreements and
sales oflicences toforeigners) bring inasmuch inexport earnings asallplant products together.
Virtually thewhole fishcatch isexported since Moroccans consume littlefish. Thefishing sector is
currently suffering frominadequate warehousing andprocessing capacity. Asaresult, approximately
onethirdofthecatch isprocessed intoby-products suchasfishoilandmeal. Theaquaculture sector
isexpanding.
(ii) Policy objectives andinstruments
13. Agricultural policy iscurrently based onthefourfollowing objectives: guaranteeing food
security; improving farmers 'income; protecting andpreserving natural resources; andintegrating
agriculture intothedomestic andworld markets. Byfoodsecurity theauthorities mean achieving a
strategic rateofsteady supply from domestic production inconditions ofcostefficiency.WT/TPR/S/8 Trade Policy Review
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14. Apolicy toprotect domestic production hasbeenlaunched. Apart fromcustoms duties, which
aregenerallyhigheronagriculturalproducts(especiallyfoodstuffs)thanonothergoods,importlicensing
andlevies areatpresent themaincomponents ofthepolicy.1Specific incentives havebeenintroduced.
Forexample market integration isbeing pursued bymeans ofincentive measures andalegalframework
fortheorganization ofmarketing, storage, packaging andprocessing channels. Atthesame timethe
State isgradually withdrawing from production andmarketing andhanding them overtoprivate
operators.
15. Agricultural income istobeimproved byreducing production coststhrough higher productivity
andeasing theconstraints onactivities up-anddownstream ofagricultural production. Other incentives
areexemption fromimport duties andtaxes, exemption ofagricultural income fromalltaxes untilthe
year2000 andproduction subsidies (Table V.1). Aidisgranted from theAgricultural Development
Fund setupforthemodernization ofagriculture withtargeted investment. Theagricultural sector
alsoreceives funding from theNational Agricultural Credit Bank (CNCA) onpreferential terms.
Table V.1
Subsidies toagricultural production andfishing, 1987-93
(inthousands ofdirhams)
1987 1988 1989 1990 1991 1992 1993a
Total
ofwhich:570 594 679 773 828 1,033 1,179
Regional office foragricultural development
(regional development)146 141 138 175 164 165 155
National Fisheries Office 4 4 4 4 4 3 ...
... Notavailable.
a Estimated.
b Inmillions ofdirhams
Source: IMF(1995b); andGovernment ofMorocco.
16. Consumer sales prices ofthemain staple foodstuffs (sugar, edible oilsanddomestic flour)
have been keptlowbysubsidies. Thishasnaturally affected theconsumer price index (Section
IV.4(iii)(b) andCharts V.2andV.3). Thedirect costofthese subsidies should befinanced byvariable
levies (Section IV.2(iii)(a)) andtheState budget.
1Completion ofthedismantling ofimport licensing foragricultural imports, particularly foodstuffs, hasbeen
postponed. Itwasplanned for1993 (Rutherford etal.,1994) thenfor1994 and1995 (Section IV.2(vii)).Kingdom ofMorocco WT/TPR/S/8
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WT/TPR/S/8 Trade Policy Review
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17. Special measures havebeenimplemented during the1995drought.2They consist ofasubsidy
ofupto50percentforcomposite animal feed, exemption fromcustom duties andtaxes forimported
animal feed(bran pellets, dried beetpulp, desiccated alfalfa), reinforcement ofsanitary coverage and
provision ofequipment forcattle watering intheprovinces mostaffected bythewater shortage. Since
the1993 drought, public works requiring considerable manpower have been undertaken -the
establishment ofwater points, roadimprovement, reforestation andstone clearance -withaviewto
creating jobsintheruralsector.3Themainobjective istocurbtheruralexodus ofsome 300,000 people
ayear; thephenomenon ismore acute during periods ofdrought.
18. Inthecontext oftheWTO Agreements, Morocco undertook tointroduce tariffquotas oncertain
agricultural products. Atthesame timeitcompleted binding allitstariff linesandthetariffication
ofquantitative restrictions. Initial tariffication rateswere380percentforovine meat, 287.5 percent
forbovine meat, 311percentforcertain types ofoils,224percentfordurum wheat andwheat,
190percentforsoftwheat, 148.5 percentforbarley, 160.5 formaize, 233.5 forunmilled rice,
256percentformilled rice,217percentforsorghum orflat-grain Indian millet, 184formillet
(Section IV.2(ii)(d)). Tariff quotas areplanned formeats, milk, cereals, oilseeds, sugar andoilcakes
(Section IV.2(ii)(e)). Atime-table established byanOrder oftheMinistry ofForeign Trade setsthe
newdates fortheliberalization ofproducts stillsubject torestrictions, particularly licensing, inthe
firsthalfof1996 (Section IV.2(vii)).
19. Evidence oftheState'sgradual disengagement fromproduction andmarketing activities isthe
factthat18public agricultural enterprises, 10ofthem inthesugar sector alone, arecurrently onthe
listofenterprises tobeprivatized. AlsoonthelistisFertima, apublic firmresponsible forimporting
anddistributing fertilizers.
(iii) Policy bytypeofagricultural product
(a) Cereals
20. Cereals aregenerally grown using traditional methods. Harvests depend onthelevelofrainfall
between November andMarch. Onlycrops grown onmodern farms (lessthan25percent), inparticular
softwheat, areirrigated. Currently, thethree main cereals cultivated arebarley, durum wheat and
softwheat. Consumption ofbarley anddurum wheat ishigher intherural thantheurban sector;
barley isalsousedforanimal feed.
21. Cereals areimported byprivate operators under supervision oftheNational Interprofessional
Board forCereals andPulses (ONICL), apublic establishment. Some 150wholesaler andagricultural
cooperatives areapproved forthemarketing ofcereals. Alicence isrequired formarketing softwheat
andexporting cereal flours except riceflour. Since 1988 theprices ofallcereals except softwheat
aresetfreely onlocalmarkets. However, theONICL intervenes occasionally through theapproved
operators tosetapricewhich willensure aminimum revenue forproducers. Asfrom1989thisprice
hasbeenreckoned onthebasis ofthe1986 producer prices adjusted forinflation. Ithasgenerally
beenhigher thantheinternational prices ofthecereals concerned.4LawNo.13-89 provides fora
system ofvariable levies onimports ofthese goods (Section IV.2(iii)(a)). Inthefirsthalfof1995
theordinary tariff ratewas45percentoncereals and2.5percentonseeds.
2The1995 drought hasbeen more severe thanthose of1992 and1993.
3LeMonde, of26April, reports that1,300 wells areplanned for1995.
4Kydd andThoyer (1992).Kingdom ofMorocco WT/TPR/S/8
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22. Producer prices ofsoftwheat anditsderivatives aresetbyaninterministerial commission.5
There isgovernment support fortheconsumer price ofdomestic flour (from softwheat withahigh
extraction rate); theONICL refunds tomillers thedifference between thepriceofsaletotheconsumer
andthecostofproduction (grain priceplusaverage fixed milling cost). Refunds arecurrently granted
for1million tonnes ofdomestic flourperyear; thequota isshared between thedifferent regions of
thecountry according tothedistribution ofthetarget population. Prices areuniform throughout the
country andateachstage ofmarketing; operators (traders, millers, bakers) receive afixed perunit
margin.6
23. Inadditiontothemarketingsystem,thereisafreemarketonwhichsome60percentofdomestic
production ofsoftwheat isconsumed, either directly onthefarms orinthesurrounding areas. The
limited capacity offunding available toapproved operators, thelowmargins granted todistributors
andtransport andstorage costsareadisincentive tocollection ofthewhole domestic output. Asubsidy
of40dirhams hasbeengranted foreachtonne ofsoftwheat grown fordomestic flourproduction and
keptinstorage byprivate operators foronemonth (Section IV.4(i)).
24. Theliberalization ofnational andinternational trade inallcereals which began in1988 isto
bepursued under arecently-adopted law. Itestablishes liberalization oftrade, processing, andthe
movement andstorage ofcereals. TheONICL willberesponsible inparticular formanaging regulatory
stocks ofcereals.7
(b) Sugar products
25. Morocco produces sugar frombeet(approximately 80percentofoutput) andcane, which are
grown mainly inirrigated areas. Domestic production covers about twothirds oflocalrequirements
(Chart V.4). Averysmall amount ofrefined sugar isimported.
26. Morocco hassixfactories producing rawsugar, tworefineries andseven integrated units(for
production andrefining ofrawsugar). Theplants areworking under capacity owing tolackofraw
materials.8Average annual percapita consumption ofsugar is30kg.:loafandgranulated sugar account
formore than80percentofconsumption.
27. TheState currently intervenes atallstages ofsugar production from thepricing ofbeetand
canetorefining. Cane, beetandsugar prices aresetbyaninterministerial commission atthebeginning
ofeachproduction season. Prices areidentical throughout theKingdom except where premiums are
applied which maybe25or40dirhams pertonne ofcanedepending ontheregion. Theconsumer
salesprice issubsidized (Table IV.3). Rawsugar production factories receive compensation forthe
relatively high price ofcane andbeet. TheCompensation Fund alsopays integrated factories
compensation equal tothedifference between theprice ofsaletoconsumers andan"economic" price
composed ofcosts considered justified plusareturn oncapital.
5TheONICL pays transport andstorage costs intheform ofafixed margin.
6According totheWorld Bank (World Bank (1994a)) there isasystem ofassigning quotas formilling soft
wheat fordomestic flour, andoperators 'access tothisbranch isalsoregulated.
7TheLawontheimportation ofcereals waspublished on21June 1995 inOfficial Bulletin No.4312; the
Prime Minister 'sOffice iscurrently examining theimplementing texts.
8Kydd andThoyer (1993).WT/TPR/S/8 Trade Policy Review
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28. Asystem ofvariable levies isplanned whereby thepriceofimported rawsugar canbealigned
withtheprice oflocalproduction (Section IV.2(iii)(a)). Thelevies areapplied aftertheimposition
ofcustoms duties which, inthefirstsemester of1995 were12.5percentforrawsugar (theordinary
rateofdutyforfinished products is45percent). Thepriceofimported rawsugar isequal totheprice
ofsaletotheconsumer minus astandard margin negotiated bytheCompensation Fund andthe
three national refineries.
29. AnOptimization Planpublished in1988provided forathree-stage reform ofthesugar sector.9
Stage oneprovides fortherenewal ofsugar sector activities bytheendofthefirstfiveyears. The
second stage isderegulation andwillabolish themonopoly oftheNational Board forTeaandSugar
(ONTS) overimports (Section IV.2(xii)). Afixed reference price andasingle margin forrefineries
aretobeintroduced andwillreplace State regulation ofprices. Thelastphase willbeprivatization
offactories. There hasbeensome delay inimplementation ofthePlanwhich started in1990. The
stages currently envisaged forimplementation are:demonopolization oftheONTS which began in
1993: theapplication oftariffequivalents attheborder, planned for1996; theelimination ofallmargin
andprice regulation inthesector asfrom 199610;privatization ofState factories (under way); and
theupgrading ofsugar facilities.
9Kydd andThoyer (1993).
10Anarticle intheMay1995 BMCE Revue d'information indicates thattheState willcontinue tosetprices
after liberalization ofactivities inthesector.Kingdom ofMorocco WT/TPR/S/8
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(c) Fruit andvegetables
30. In1993, Morocco 'sexports offresh, canned andpackaged fruitandvegetables amounted to
3.4billion dirhams (approximately 9percentoftotalexport earnings). Themain destination isthe
EUandmore particularly France. Exports offruitandvegetables (i.e.freshtomatoes andcourgettes)
totheEUaresubject toseasonal tariff quotas; except forpayment ofaminimum entry price, the
quotas areduty free.11In1993 there were 155fruitandvegetable canning plants employing
23,200 people. They hadaturnover of3.17billion USdollars, ofwhich exports accounted for
2.5billion. There isa2.5tariff onseedimports; theordinary rateis45percentforimported fruit
andvegetables andtheirproducts.
31. Morocco alsohasawine andcider production industry and19plants fortheproduction of
non-alcoholic beverages; in1993 they employed over 4,000 people andhadanoutput of
2.31billion dirhams, partly fordomestic consumption, andexports brought in88million dirhams.12
(d) Oilseeds andderivatives
32. Morocco produces vegetable oils,inparticular sunflower, soya-bean, rapeseed andolive oil;
sunflower oilproduction iscurrently booming. Asinthesugar sector, theState intervenes atevery
stage ofproduction except inthecaseofolive oilwhich isentirely inthehands ofprivate operators.
COMAPRA, aState company which istobeprivatized, hasthemonopoly onpurchasing theraw
materials from producers. SEPO, aprivate firm, hasthemonopoly onpressing. Refining isdone
by14factories towhich quotas areassigned. Thebuying price fortherawmaterials andunrefined
oils,andtheprocessing margins arefixed byaninterministerial commission. Admission tooperate
inthebranch wasregulated untilSeptember 1993 when alawwaspassed deregulating admission to
theoilseed pressing andextraction industry andtheedible oilrefining sector.
33. Oilseeds andunrefined oilareimported under thecontrol ofBURAPRO, aState company.
Vegetable oilimports aresubject tolicensing (except forolive oil,Table AIV.2). LawNo.13-89
provides foravariable levyonimports ofoilseeds andtheirderivatives, butthelevyhasapparently
never been applied (Section IV.2(iii)(a)). Consumer subsidies onedible oilsrose from
430million dirhams in1989 to745million in1993 (seeTable IV.3). Customs tariffs range from
2.5percentonseeds andfruits forsowing and12.5percentonunrefined oilsto45percentonrefined
oilsinthefirsthalfof1995. Morocco plans toliberalize importation andlocalmarketing ofthese
products asfrom 1996, oncetheaccompanying measures areinforce (Section IV.2(vii)).
(e) Tobacco
34. TheRégie destabacs, aState company, hasthemonopoly onproduction andmarketing of
tobacco andtobacco products. Thetariff ratesapplying inthefirsthalfof1995 were 2.5percent
onimports ofraworunmanufactured tobacco andontobacco refuse; 12.5percentontobacco extracts
andessences and7.5percentonother types oftobacco.
35. In1993output bythesixtobacco companies amounted to3.7billion dirhams. They employed
2,870 people. Exports amounted to5million dirhams, a124percentincrease over1992.
11Forfreshtomatoesforexample,themaximumquotalevelfixedfortheperiodfrom1Novemberto31March
is130,000 tonnes atanentry price of560ECUs pertonne. Thisislower thantheprice forMFN imports.
12SeeTable AIV.1 fordetails ofindirect internal taxes onthese products.WT/TPR/S/8 Trade Policy Review
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(f) Livestock
36. Local meatproduction (bovine, ovine, caprine andpoultry) covers alargepartofconsumption
which dropped from 14.8kg.percapita in1971 to9.6kg.in1991.13Special measures havebeen
applied during the1995 drought (Section V.2(ii)). Atpresent there isgovernment support forthe
transport ofanimal feed(except hay).
37. InJune1993, tariff equivalents of100percentorhigher were established forliveanimals,
meats, dairy products andsome oftheirby-products. Thetariffratewas365percentfornon-breeding
ovine animals andtheirmeatattheendofthefirsthalfof1995. Meat prices aresetbythemarket;
onlyslaughter taxesanddistribution margins arestillfixed. Locally, thepriceisbased ondailymarket
price lists.
(iv) Fishery products andby-products
(a) Developments inproduction andtrade
38. TheMoroccan fleetcomprised 2,600 ships and12,000 small fishing vessels in1994. Catches
rosefrom about 550,000 tonnes in1990 toalmost 750,000 tonnes amounting toavalue of
4.9billion dirhams in1994. Sardines, ofwhich Morocco isoneoftheleading world producers, account
forapproximately 75percentofcatches andarecanned forexport.14Morocco alsofishes tuna,mackerel
andanchovy.
39. Deep-sea fishing hasexpanded rapidly. Itrosefrom approximately 26,000 tonnes in1980
toabout 135,000 tonnes in1994, andin1993 accounted forlessthan25percentoftotalcatches and
more than65percentofearnings. Catches arecomposed mainly ofduikers, white fish,pelagic fish,
crustaceans, molluscs andshellfish. Theyareexported toJapan, Spain, Italy, France andafewAfrican
countries. Aquaculture (shrimp, seabream, bass, eels,clams andoysters) isexpanding: earnings
amounted to29million dirhams in1990 and96million in1994. TheState directs andencourages
thedevelopment ofaquaculture; itisoneofthesectors tobenefit fromtheMaritime Investment Code.
40. Fishisalsousedinmanufacturing fishoilandfishmeal. Activities inthesector aremainly
inthehands ofprivate operators; onepublic firmproducing fish-based foodforexport isonthelist
ofcompanies tobeprivatized.
41. Theissuing oflicences toforeign vessels under fishing agreements accounts forasubstantial
partofearnings; financial compensation from theEUandJapan amounts to102million ECUs and
7million United States dollars respectively.
(b) Government policy
42. TheGovernment 'smedium-term objectives aretoexceed 1million tonnes offishproduction
andtobring in1billion United States dollars from theSector 'sexports. Itplans todouble annual
domestic fishconsumption tobring itto400,000 tonnes (i.e.anaverage annual percapita consumption
of15kg.)andtocreate 100,000 newjobs.15
13World Bank (1994b).
14Morocco alsoexports agar, aredseaweed extract.
15Currently, theMoroccan fisheries sector directly orindirectly employs 400,000 people.Kingdom ofMorocco WT/TPR/S/8
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43. TheGovernment grants fishing activities taxadvantages andexemption from VAT and
corporation tax.Coastal fishing companies receive arebate oftwopoints onfinancial charges for
credits granted forthepurchase, construction andmodernization oftheirvessels. TheStatealsogranted
apremium of15percentofthepriceofcertain equipment forthemodernization ofvessels. Another
premium equal to5percentoftheprice ofanidentical newvessel wasgranted forthedemolition
ofoldships. Thepremiums could notbeinaddition totheexemption granted toactivities inthissector
from profit taxorthegeneral taxonincome; theirgrant wasnotcontingent upon thepurchase of
parts, equipment orvessels ofMoroccan origin. According totheauthorities, thepremium system
hasrecently beenabolished.
44. Theprice ofindustrial fishisfixed bylocal fishery committees inwhich shipowners and
industrialists arerepresented. Thecommittees advise theadministration ongeneral matters related to
fishing andthesaleofseaproducts. Theadministration intervenes inpricing onlytoarbitrate and,
more often, toofficialize theagreed prices. However, theprice reflects thefactthatemployers are
required torecruit larger crews than arereally necessary.16In1994 tocreate ajobcost
1,500 United States dollars forasmall motor vessel and100,000 United States dollars foradeep-sea
fishing vessel.17Theordinary tariff rateforimports offishproducts is35percent.
45. Aspartofitsfoodpolicy, theGovernment isencouraging theestablishment ofacoldchain
tocover theentire Moroccan territory. TheMinistry ofMaritime Fishing andtheMerchant Navy
hascarried outapre-feasibility study foraproject tosetupacoldstorage anddistribution network
forfresh anddeep frozen pelagic species fordomestic consumption, especially ininland areas.
Implementation oftheproject hasbeenentrusted toprivate companies. Afirstexperimental unithas
been setupinAgadir for"Surimi" (asardine-based fishpaste) aspartofaprogramme forthe
diversification offishery production. Other newprepared, deep-frozen andready-to-eat products are
under study. Acampaign topromote fishconsumption isalsoenvisaged.
46. Morocco intends toreinforce itsmaritime surveillance system andhasputoutapreliminary
international calltotender forastudy oftheinstallation ofasatellite surveillance system. Major work
isbeing donetoextend andimprove fiveports. Theaimistoextend suchwork toallports by1997.18
Attheinitiative ofprivate operators, Morocco andMauritania haveharmonized theirtrade policies
onduikers, particularly withaviewtocontrolling supply.
(c) Bilateral agreements
47. Morocco andSpain werebound byaFishing Agreement signed inAugust 1983. WithSpain's
accession totheEuropean Community (EC)inJanuary 1986, Morocco signed anagreement withthe
ECinFebruary 1988. Itlimited annual captures byEuropean fishermen inMoroccan territorial waters
to95,000 tonsinexchange foralicence of70million ECUs. TheAgreement wasrenewed inMay1992
forafurther period offouryears afteratwo-month transition period. Under thesecond agreement
withtheEC,Morocco received a102million ECUs yearly forlicences; theagreement 'sexpiry date,
initially 1996, wasbrought forward to30April 1995. Negotiations have been under waysince
April 1995ontheunloading inMoroccan portsofcatches bytheholders offishing rights; areduction
incatches according tospecies andareduction oftheCommunity fleet; observance ofbiological rest
periods; improved European market access conditions forMoroccan canned sardines. Thenegotiations
arepartofabroader partnership agreement between Morocco andtheEU.
16Leymarie andTripier (1993).
17Jeune Afrique, No.1794, 25-31 May 1995.
18Jeune Afrique, No.1794, 25-31 May 1995.WT/TPR/S/8 Trade Policy Review
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(3) Mining andquarrying
48. Themining sector hasanimportant place inthenational economy. Theweight ofthesector
isreflected initsshare innational exports, thenumber ofjobsitprovides anditsparticipation in
establishingthenecessaryinfrastructuresforsocialandeconomicdevelopment.In1994,exportearnings
from mining products amounted to3,551 million dirhams.
49. Morocco istheworld 'sleading exporter ofphosphate. Itholds approximately onethirdof
themarket andmore thanhalfofworld reserves. Lead, copper, zinc, chemical manganese, silver,
saltandcobalt arealsoamong itsmainmining products. Morocco alsoproduces coal,destined almost
entirely forlocalconsumption. Thepolicy forlocaldevelopment ofmining products seems tohave
contributed toincreasing theshare offinished andsemi-finished products inexports; itwasaimed
principally atphosphate products.
50. TheState'smain roleistoorganize anddirect development ofthemining sector, improve
structures andcreate anenvironment designed toimprove thecompetitiveness ofmining companies.
Thestrategy istomake thesector more attractive toprivate investment inprospecting anddevelopment
andtoconsolidate achievements. Efforts bytheMinistry ofEnergy andMines arefocused mainly
onreforming andupdating rules andregulations; stepping upgeological andmining research;
maintaining andreinforcing existing plant; adding greater localvalue tomining products; encouraging
small andmedium-sized enterprises; andpromoting theuseful substances andindustrial mineral sector.
Aneffort hasbeenmade torestructure andimprove public establishments andenterprises tomake them
competitive.
(i) Phosphate
51. Phosphate accounts forsome 25percentofthecountry 'sexport earnings. TheGovernment 's
aimistodevelop rawphosphate further inorder toincrease theshare ofphosphate products inthe
sector 'searnings; acids andfertilizers currently account forapproximately 7percentofthevalue
ofphosphate-based exports (Chart V.5). Thelong-term objective istoincrease Morocco 'sshare in
world tradeinphosphates andby-products fromitscurrent levelofapproximately 15percentto20per
centbytheyear2005.
52. Formorethantwodecades theshare ofby-products inMoroccan phosphate tradehascontinued
toincrease tothedetriment ofrawphosphate. Thischange instructure isduetotheestablishment
ofalarge scale chemical processing industry. Overall, installed capacity allows processing of
11.5million tonsofphosphates intheform ofphosphoric acidorsolid derivatives, particularly
diammonium phosphate, ammonium phosphate andtriple superphosphate. L'Office chérifien des
phosphates, aState-owned company, holds themonopoly formining andprocessing phosphate and
marketing phosphate products (Section IV.3(v)). Ittherefore hasaleading roleontheworld market
forphosphates andphosphate products.
53. Since themid-1970s, thesector hassuffered inparticular fromthesteady dropinworld prices,
landfallowing andtheecological concerns ofcountries importing industrial fertilizers. Theshare of
fertilizers intotalexport earnings wasapproximately 10percentin1990andhasnowdropped toabout
8percent.19
19According toLeymarie andTripier (1993), Morocco 'sconsumption offertilizers isamong thelowest in
theworld andisone-third lower thanthatofcountries withcomparable economies.Kingdom ofMorocco WT/TPR/S/8
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54. Therelatively highconsumption costs ofmanufacturing these products (investment, sulphur,
energy andtransport) limit itsadvantages.20Morocco 'sphosphate products willcome upagainst
competition fromexports bythecountries intransition which, inaddition, produce theirownsulphur.
However, benefits areexpected frommultilateral liberalization, particularly tariffcutsintheimporting
countries.21
(ii) Other extractive industries
55. Almost threequarters ofMorocco 'slead-about 127,000 tonsayear-ismined bytheTouissit
Mining Company. Oreprocessing islargely inthehands ofitsmain customer, theOued ElHeïmer
leadfoundry. Average rawleadexports fortheperiod 1979 to1993 amounted to54,000 tonsfor
avalue of227million dirhams.
(4) Manufacturing
56. Textiles andclothing, automobile assembly andthemanufacture ofspare parts, electronic and
electrical assembly, refineries anddrugmanufacture account formostoftheenterprises inMorocco 's
manufacturing sector. Chart V.6shows trends inproduction, exports andemployment inthemajor
branches oftheindustry since 1990.
20Bocoum (1992).
21Rutherford etal.(1994).WT/TPR/S/8 Trade Policy Review
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Kingdom ofMorocco WT/TPR/S/8
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57. Between 1991 and1993, thelevelofproduction intextiles andclothing, thesector 'sleading
branch, amounted toapproximately 20billion dirhams, ofwhich exports represented agrowing share
(54percentin1990 andalmost 60percent1993). Thebranch accounted forsome 44percentof
Moroccan exports ofindustrial products, andhasthelargest proportion ofexporting firms inthewhole
sector. Itsshare intotalexport earnings isapproximately 25percent. Thisperformance isentirely
duetotheclothing branch.
58. Tocombat contraband andinformal activities, inNovember 1994 theGovernment lowered
tariffs onsome imports ofindustrial products notmanufactured locally. Thesector 'scompetitiveness
isstillaffected byhighenergy costs. Rawmaterials notproduced inMorocco areasaruleimported
duty-free, whereas inthefirsthalfof1995 tariffs onother types ofimports ranged forthemostpart
from 2.5to35percent.
(i) Textiles andclothing
59. Thetextiles andclothing branch hasseveral small family-scale firms; approximately 55per
centofthe1,800 enterprises employ fewer than50workers andaccount for16percentofproduction.
Thebranch employs atotalof183,000 people, 56percentofthemwomen. Itsassets areitsproximity
toEurope andlower labour costs (Chart V.7).
60. Thebranch produces fabrics, some 75percentofwhich areconsumed locally, knitwear, and
ready-to-wear garments, 90percentofwhich areexported. Ready-to-wear firms import approximately
90percentoftheirproduction inputs. There isconsiderable subcontracting intheformofOutward
Processing Traffic (OPT).22Inputs forOPTareimported freeofcustoms duties andimport taxes.
61. Morocco wasnotaparticipant intheMultifibre Arrangement (MFA). However, ithasa
voluntary export restraint arrangement with theEuropean Union forcertain products. Since
December 1991, thearrangement applies onlytotrousers (Section IV.3(iv)).23Agreed quantities have
increased byapproximately 63percentsince1991andstand at43.8million unitsin1995. AsTable V.2
shows, implementation oftherestraints wasfairly flexible; exports exceeded thelevels set.Agreed
quantities forOPTareincreasing steadily andin1995 arealmost double those forordinary exports
oftrousers (28.3 million unitsasopposed to15.5million). Thephasing-out ofquantitative restrictions
onexports ofproducts fromthisbranch envisaged intheWTO Agreements could haveonlyalimited
medium-term effect onMoroccan exports since thelatter areamong thegoods tobeliberalized under
theEUprogramme attheendofthetransitional ten-year period.24
22deCoster (1994).
23TheEUhasinformed theWTO Textiles Monitoring Body thatinthecontext ofitspreferential trading
agreement withMorocco, consultation levels have beenagreed intheform ofatransitional arrangement. They
willbeeliminated once thefree-trade areaisestablished.
24WTO (1995).WT/TPR/S/8 Trade Policy Review
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Kingdom ofMorocco WT/TPR/S/8
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Table V.2
Voluntary restraints ontextiles, 1990-93
(millions ofunits)
1990 1991 1992 1993
Agreed
quantitiesResults Agreed
quantitiesResults Agreed
quantitiesResults Agreed
quantitiesResults
Trousers
France 14,984 25,142 15,963 23,690 18,750 21,546 19,988 25,565
Germany 4,346 3,124 4,608 3,675 5,458 4,220 5,790 5,634
Benelux 1,612 1,322 1,718 1,670 1,726 2,029 1,839 2,222
United
Kingdom800 372 840 232 1025 2261 1079 4864
Others 3,558 3,030 3,746 5,061 5,141 7,321 5,396 8,200
Total EU 25,300 32,990 26,875 34,328 32,100 37,377 34,092 46,485
Shirts
France 9,750 12,540 10,127 12,167 n.a. n.a. n.a. n.a.
Benelux 550 359 567 246 n.a. n.a. n.a. n.a.
Total EU 10,300 12,899 10,694 12,413 n.a. n.a. n.a. n.a.
Blouses
France 2,720 2,122 2,868 1,847 n.a. n.a. n.a. n.a.
Dresses
France 1,367 673 1,475 380 n.a. n.a. n.a. n.a.
n.a. Notapplicable.
Source: IMF(1995b).
62. Tariff ratesonimported textiles andclothing range from 0to35percent. Tariff protection
isprogressive; thelower ratesapply torawmaterials andsemi-finished products. Apart frominputs,
imports aresubject toa15percentfiscal import levy(PFI) andanordinary VAT rateof19percent.
Privatization of11oftheState-owned companies operating inthisbranch isplanned.
63. Toimprove export performance, themeasures decided onbytheGovernment andtheindustry
arediversification ofproducts anddestinations, andquality improvement intheclothing branch and
thevarious related services. Atraining scheme hasbeensetupforthispurpose, covering fashion
design, presentation ofcollections andrelated activities. Contacts havebeenmade withdesigners and
distribution firms inSpain andPortugal withaviewtosetting uppartnership networks.
(ii) Transport equipment
64. Production inthetransport equipment sector registered anoverall decline of19percentbetween
1992 and1993. Itwasmostmarked inrailway vehicles (53percent), private vehicles (27percent),
commercial vehicles (9percent)andaeronautical construction andaircraft repair (11percent). There
were102establishments inthesector in1993. The42firms withforeign participation operating in
thesector account alone for66percentofproduction, 71percentofvalue added and76percent
ofexports.WT/TPR/S/8 Trade Policy Review
Page 68
65. TheactivitiesoftheMoroccanautomobileindustryareassemblyofcarsandcommercialvehicles,
repairs andthemanufacture ofcertain spare parts forvehicles. Firms currently operating thesector
include Renault Maroc, SOPRIAM, SOMACA, SMEIA, Berliet, SAIDA, Autohall etSIAB, and
Somami-Rahali.
66. Theautomobile industry hasbeenexperiencing difficulties forseveral years. From 1992 to
1993, registrations ofprivate carsofMoroccan origin dropped by45percentwhereas those ofimported
cars,whatever theirorigin, increased; registrations ofcommercial vehicles ofMoroccan origin also
fellby33percent. Exports ofspare partsforprivate carsdropped from198million dirhams in1992
to158million dirhams in1993.
67. InJune1994, thegovernment invited tenders fortheconstruction ofan"economy" car.Fiat
AutoSPAwasawarded thecontract andtheagreement itsigned on23June1995 withtheMoroccan
Government provides fortheproduction of6,000 "Fiat Uno" in1995, 14,500 in1996 and19,500
inthefirstninemonths of1997. Thereafter, the"Fiat Uno" willbereplaced byanewmake called
"178" thatFiatisreportedly intheprocess ofdesigning.25
68. Asubsidiary ofFiatistobeestablished inMorocco. SOMACA, asemi-public company, will
purchase spare partsfromitforassembly of"economy" cars. Thecarswillbesoldonthelocalmarket
bytheFiatsubsidiary attheunitprice of64,000 dirhams forthepetrol version and70,000 dirhams
forthediesel version. CKD imports forassembly of"economy" carsareexempt fromcustoms duties
andPFI.VATontheproduction ofthecaris7percentinstead oftheordinary 19percentrateapplying
tothebranch. However, thepercentage ofMoroccan components tobeincorporated intheproduction
ofthe"economy" caristoincrease; spare parts ofMoroccan origin maybeexported inexchange
(Section IV.2(xi)).
69. Under the1995 tariff, theordinary rateofdutyis35percentonimported newvehicles.
However, imports ofunpainted CKD parts withnon-welded chassis aresubject toarateof7.5per
centandimports ofSKD parts, toarateof17.5percent.26
(iii) Other activities
70. TheMoroccan pharmaceutical industry currently has24laboratories representing more than
260foreign laboratories andproducing almost 3,500 patent drugs. Thesector accounts foralmost
80percentofthedrugs market which amounted to3billion dirhams in1993. Output reached
2.7billion dirhams in1993, -2.3percentofindustrial production -andexports amounted to
250million dirhams.
71. Theordinary rateofdutyondrugs is30percentandPFIis12.5percent. TheMinistry of
Public Health examines applications tooperate inthepharmaceutical sector, authorizes importation
ofrawmaterials andfinished products andreviews andfixesdrugprices. Prices forthesaleofdrugs
tothepublic aredetermined onthebasis ofc.i.f. prices, import duties andtaxes andadistribution
margin.
25SOMACA wasalready producing 1,000 "Fiat Uno" annually under licence. Thisinformation hasmostly
been drawn from Africa Economic Digest, 22May1995; Jeune Afrique Economie, 17April 1995; Marchés
Tropicaux, 5and12April 1995; LeMatin duSahara etduMaghreb, 24June1995; andMiddle EastEconomic
Digest, 7July1995.
26SKD: semi-knocked down .Theimportation ofCKD cycles andmotorcycles issubject toatariff rateof
2.5percent.Kingdom ofMorocco WT/TPR/S/8
Page 69
72. In1993theelectricalandelectronicequipmentbranchhad113establishmentsincluding32export
firms. Ithadaturnover of3.05billion dirhams ofwhich exports accounted for560million dirhams.
Theinsulated electric wires andcables sector isthelargest, accounting for40percentofthetotal
turnover. There isreportedly aconsiderable amount ofsubcontracting particularly inelectronics
(assembly ofelectronic cards andsemi-conductor-based components).
73. Morocco alsoproduces approximately 10,000 tonnes ofcrude oil,almost 600,000 tonnes of
coalandapproximately 25million cubic metres ofnatural gasannually. Crude oilaccounts for
approximately 13percentofthecountry 'stotalimports. Itisrefined domestically andasmall quantity
isre-exported.
74. On1January 1995theprovisions onthecontrol ofimports ofpetroleum products wererepealed.
These products nowenter freely. However, inorder tooperate, importers mustobtain authorization
fromtheadministration, which issubject totheirpossessing adequate reception andstorage facilities.
Anewlawamending andsupplementing theDahir onthepetroleum sector hasjustbeenenacted and
published intheOfficial Bulletin.
75. InJanuary 1995anewpricing system wasadopted forpetroleum products based onthemonthly
indexation ofex-refinery prices withreference tointernational quotations. Asimilar system isapplied
instabilizing fiscal charges onenergy products, where fueloilandcoalcharges areharmonized. With
thecompletion ofprivatization ofalldistribution companies in1994, itwasdecided totransfer the
twolocalrefineries (SAMIR andSCP) totheprivate sector.
(5) Services
76. Services account forapproximately 50percentofGDP formation. Tourism, electricity,
telecommunications, transport andfinancial services areamong theleading branches. Inthecontext
oftheGeneral Agreement onTrade inServices, Morocco hasbound market access conditions inseveral
sectors, including professional services, other services toenterprises, value-added services in
telecommunications, services relating totheenvironment, financial services andtourism. All
commitments exclude thephysical presence offoreigners except forcertain executives andexperts.
(i) Tourism
77. Tourism isoneofMorocco 'smajor sources offoreign currency, bringing inalmost
11.5billion dirhams annually (Chart V.8). Some 4million tourists, many ofthemMoroccans residing
abroad, havevisited thecountry annually since theearly1990s. Thesector employed 536,000 people
directly orindirectly in1993.WT/TPR/S/8 Trade Policy Review
Page 70
78. In1994 Morocco 'sreception capacity wasapproximately 90,000 bedsin553establishments
(hotels, residences andholiday villages, seaside resorts) more than60percentofwhich werehotels
withthree ormore stars.27Hotel prices arefixed byagreement between theHoteliers Federation and
theregional associations ofthehotel industry. Total reception capacity ofestablishments hasvaried
littleinthelastfewyears. Thetourism sector suffers from therelatively highcostoftransport due
tothefactthatfuelisexpensive inMorocco.
79. There wasanoverall dropof13.2percentinthenumber ofentries in1994. TheGulfcrisis
andtension intheregion wereadisincentive toEuropean tourists whoaccount formore than60per
centofthetotal. According totheauthorities, asubstantial decline intourists from other Maghreb
countries (approximately onethirdoftotaltourists) in1994hadnosignificant effect onearnings since
theirsubsistence expenditure inMorocco hasbeenrelatively lowinthepast. Ofthe37hotels onthe
listofenterprises tobeprivatized, 16havealready beentransferred toprivate operators (Table AIV.4).
80. Aninvestment charter reproducing theadvantages granted byalltheinvestment codes isin
theprocess ofbeing adopted bytheMoroccan authorities (Section III.2). According toseveral
publications, thecodes grant exemptions fromcustoms andtaxes onimported capital goods, loans on
preferential terms andspecial advantages fortheacquisition oflandfortheconstruction ofhotels.
Ithasalsobeendecided recently toreschedule thedebtofhoteliers andreduce VAT inthesector.
TheGovernment grants areduction ofinterest ratesoncertain credits forinvestment inthesector and
spends approximately 150million dirhams yearly inpromoting tourism.28Amobile police force to
beresponsible forthesafety oftourists isenvisaged.
27Morocco alsohas954unclassified hotels withatotalofalmost 27,000 beds.
28Euromoney May 1994 (supplement).Kingdom ofMorocco WT/TPR/S/8
Page 71
81. Under theGeneral Agreement onTrade inServices, Morocco hasguaranteed market access
andnational treatment forforeign suppliers ofaccommodation services. Itscommitments cover in
particular cross-border supply, consumption abroad andcommercial presence. Restaurants andother
tourism services havealsobeenbound under twomodes ofsupply: consumption abroad andcommercial
presence. Travel agencies outside Morocco mustsupply theirservices through agencies established
onMoroccan territory; foreign agencies mayestablish acommercial presence inMorocco onlyafter
obtaining anoperating licence.29Tourist guides mustbeMoroccan nationals. However, groups may
beaccompanied by"tour leaders".30
(ii) Electricity
82. Electricity isproduced fromthermoelectric andhydroelectric sources; theNational Electricity
Board (ONE) isresponsible forproduction andtransport. Distribution isalsocarried outbytheONE
inruralareas andseveral urban centres, orby10municipal administrations inthelargeurban centres.
Adecree lawcurrently allows theONE tosubcontract theproduction ofelectricity ofover10MW
oncondition thattheproducer supplies theenergy produced exclusively totheONE andthattheclauses
oneconomic balance inthecontract areobserved.
83. Tariffs arefixed byanOrder oftheMinister forPromotion oftheEconomy delegated tothe
Prime Minister 'sOffice, afterconsultation withtheInterministerial Price Commission. They areset
inproportion tothetension atwhich electricity isconsumed; there isnopreferential treatment for
anysector orfirm. According totheauthorities, in1994 taxes levied onfuelsandcoalusedbythe
ONE accounted forapproximately 12.5percentofthecostofelectricity produced bytheONE.
84. Table V.3shows thelevelofenergy production andconsumption inMorocco.
85. Inviewofthelowruralelectrificationrate,anewprogrammeisbeingimplemented.Itintegrates
allmethods ofelectrification (network andrenewable resources) andisdesigned toraisetherateto
80percentbytheyear2010 -i.e.coverage of2million households and12.3 inhabitants.31
Onebillion dirhams 'funding fortheprogramme willcome from theONE, local communities and
consumers whopayunder aninstalment system.
29Therequirements forobtaining thelicence areadiploma from atourism institute ormore thanfiveyears
experience asadirector orhead ofatravel agency, good moral conduct andsound finances.
30GATS/SC/57, 15April 1994.
31Currently, ruralelectrification covers 400,000 households, i.e.2.4million ruralinhabitants; thisrepresents
anelectrification rateof21percent.WT/TPR/S/8 Trade Policy Review
Page 72
Table V.3
Energy production, 1987-93
1987 1988 1989 1990 1991 1992 1993
(inmillions ofkilowatt/hours)
Production
Netelectricity production
6,724.0 7,000.0 7,592.0 8,025.0 8,073.0 9,123.0 9,390.0
Hydroelectricity 805.7 915.0 1,134.0 1,196.0 1,246.0 981.0 450.0
Thermo- electricity 5,918.3 6,085.0 6,458.0 6,829.0 6,827.0 8,142.0 8,940.0
(inmillions oftonnes)
Crude oilextraction 18.3 20.0 13.0 15.0 11.4 9.0 10.0
(inmillions ofcubic metres)
Natural gasextraction
73.7 83.0 62.0 57.0 38.4 24.0 24.0
Source: IMF(1995b).
(iii) Telecommunications
86. Telecommunications isamajor industry interms ofinfrastructure andishelping toimprove
theperformanceofseveralbranchesofproduction,includingtourism.TheMoroccantelecommunications
network had1million subscribers in1994. Telephone density rosefrom0.96in1983to2.5in1992;
itisthelowest inNorth Africa where theaverage was3.6in1992.32Thewaiting period foratelephone
lineisfourmonths. Thesector employs 13,400 people.
87. TheNational PostandTelecommunications Office (NPT) holds themonopoly ontheState's
behalffortheestablishmentofnetworksandprovisionoftelecommunicationservices.Telephoneservices
andtelex account forvirtually allearnings.33They brought in3.9billion dirhams in1992 and
4.6billion dirhams in1993 (approximately 2percentofGDP). Halftheearnings come from
international communications, particularly withtheEuropean Union. Private promoters areallowed
tooperate telecommunication terminals from private premises ofwhich there were479attheendof
1994.
88. Thetariffication system isbased ontheprinciple oftariff equalization between international
anddomestic services. Inaccordance withtheprinciple ofuniversal service, where operations are
notprofitable incertain regions, theONPT passes onthelossofearnings toother regions. According
totheauthorities, ascompared totheEU,ratesinMorocco arelower forlocalandtrunk callsand
considerably higher forinternational calls. Table V.4shows that,apart from Saudi Arabia, itcosts
less,attheregular 1994 rate,tocallMorocco from the10countries selected thanviceversa.
32ElYahyaoui(1994).Telephonedensityisdefinedasthenumberofmaintelephonelinesper100inhabitants.
TheAfrican average was1.5in1992.
33Toumi (1994). Mr.Toumi istheDirector ofStudies andPlanning attheMoroccan Ministry ofPostand
Telecommunications.Kingdom ofMorocco WT/TPR/S/8
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Table V.4
Telephone rateperthree minutes, 1994
Regular rate(USdollars)
Country Rate
(from Morocco)Rate
(toMorocco)
India
02/05/94 (1US$=31.37) 10.77 7.17
United States (AT&T) 9.22 7.77
United Kingdom (BT)
14/06/94 (1US$=0.64) 4.611 2.66
Saudi Arabia
12/04/94 (1US$=3.75) 6.16 6.72
Singapore
15/03/94 (1US$=1.53 10.77 8.85
Hong Kong
13/05/94 (1US$=7.73 10.77 5.43
Japan
15/03/94 (1US$=100.15) 10.77 14.97
Australia
11/04/94 (1US$=3.60) 10.77 6.79
South Africa
12/04/94 (1US$=3.60) 10.77 7.05
Germany
16/02/94 (1US$=1.60) 4.61 2.44
Source: International Telecommunication Union, Geneva.
89. Allequipment forcommunication, including byradio, mustbetype-approved bytheONPT;
theapproval process takes onemonth onaverage. According totheauthorities, current
telecommunications standards inMorocco arethose prescribed byinternational organizations, more
particularly theInternational Telecommunication Union. "Callback" services areforbidden.
90. Inthecontext oftheWTO General Agreement onTrade inServices, Morocco hasbound market
access conditions forelectronic mail, telephone voice messaging, permanent information retrieval and
database servers, improved telefax andprotocol conversion. Alltheseservices mustbesupplied through
thepublic network. There isreportedly tobealawauthorizing theirliberalization. TheONPT will
continue toholdthemonopoly fortelephony andtelexandliberalized services willbeprovided using
ONPT media. Accompanying measures forliberalization arereportedly under study.
91. Thegovernment isplanning tomaintain exclusive monopoly rights foracertain period onthe
establishment ofinfrastructure networks forthepoint-to-point telephone service andtelex. Allother
services andnetworks willbeopened upunder thelicence authorization ordeclaration regime.
Implementation oftheliberalization programme should contribute totheprosperity ofMoroccanWT/TPR/S/8 Trade Policy Review
Page 74
telecommunications.34Apart fromproviding opportunities vis-à-vis partner countries, theauthorities
hopethatitwillcreate jobsandcontribute tothetransfer oftechnology. However, thenetwork needs
technical improvement.
(iv) Transport
(a) Maritime transport
92. TheMoroccan fleethad44unitswithatotaltonnage of250,500 tonnes deadweight in1994.
Ittransported anoverall tonnage of5.17million tonnes in1994 asopposed to5.76million in1993.
Twenty-eight percentofitwastransported bytheMoroccan Navigation Company (COMANAV),
astateowned enterprise which operates incompetition withprivate Moroccan companies.
93. ObsolescenceofitsvesselsandlackoffundingareamongtheMoroccanfleet'scurrentdifficulties
andexplain thedropinitsactivities. Thecoverage rateofitsrelations withtheexterior inthearea
ofmaritime transport was25percentin1994asopposed to30percentin1993. Passenger andvehicle
transport prices haveremained unchanged since 1990.
94. According totheauthorities, there arenorestrictions ontraffic, butoncertain linesthere are
conference agreements inaccordance withtheUNCTAD Code ofConduct forLiner Conferences.
Theshipowners themselves monitor implementation oftheagreements andthere isnointervention
bytheauthorities inthesharing oftraffic. Theshipowners alsofixshipping tariffs. Intervention by
theMerchant Navy Administration isconfined tosupervision ofsecurity, registering newforeign
shipowners operating onregular lines, andlinertraffic. Tramping (drybulk, liquid bulk, homogeneous
merchandise) iscompletely free.
95. Theobjective oftheMinistry ofMaritime Fisheries andtheMerchant Navy istocombat
"unfair competition" fromforeign shipowners, particularly thoseoperating with"substandard" vessels.
TheAdministrationensuresthatnewshipownersgiveadequateguaranteesthatservicewillbemaintained
forareasonable length oftimeandthattheyoperate withvessels thatmeetinternational safety standards.
TheMinistry 'spolicy onpassenger andvehicle transport ismainly focused ondiversifying transit points,
andincreasing thenumber ofturn-arounds andtransport capacity.
96. Morocco participates actively inthework oftheNegotiating Group onMaritime Transport
Services established oncompletion oftheUruguay Round andhastopresent itsfinalreport byJune
1996 atthelatest. Thenegotiations arecomprehensive inscope andareaimed atcommitments in
international shipping, auxiliary services, andaccess toanduseofportfacilities withaviewtoremoving
restrictions within afixed time-scale. Until thenegotiations arecompleted, Article IIoftheGeneral
Agreement onTrade inServices andparagraphs 1and2oftheAnnex onArticle IIExemptions are
suspended intheirapplication tothissector.
97. TheNational PortAuthority (ODEP), another State enterprise, holds themonopoly forthe
management andoperation ofthecountry 's20ports (11ofwhich arecommercial).
(b) Airandrailtransport
98. Morocco has11international airports andseven national airports. Thecountry isserved by
Royal AirMaroc (RAM) andacharter company. RAM has29aircraft, 27ofwhich areformedium-
andlong-haul flights. According tosome sources, airfreight ratesfromTunisia tocertain European
34Toumi (1994).Kingdom ofMorocco WT/TPR/S/8
Page 75
destinationsareconsiderablylowerthanthosefromMorocco.35TheNationalAirportAuthority(OMDA)
holds themonopoly ontheState'sbehalf forthemanagement andoperation ofairports.
99. Regular tariffs aregoverned bybilateral agreements. They aredecided oninIATA annual
conferences andsubmitted togovernments forapproval. Eachcompany mustsubmit totheMinistry
ofTransport forapproval thetariffs itwishes toapply onroutes toMorocco. Charter ratesarefixed
bycommon agreement between thecarrier andthetouroperator; theymust include ground service
costs. Freight tariffs aresubmitted theMinistry ofTransport forapproval withtheagreement ofthe
Ministry ofFinance.
100. Morocco has1,900 km.ofrailtrackofwhich 1,000 km.areelectrified and270km.two-way.
Studies onseveral projects toextend existing networks orcreate newlineshavebeenfinalized. The
National Railway Board (ONCF) holds themonopoly foroperating andmanaging thelinesontheState's
behalf.
(c) International roadtransport
101. Authorizationforinternationalroadtransport(TIR)isgrantedbyanationalcommission.Permits
forcirculating onthenational territory areissued toforeign transporters bythecustoms service on
behalf oftheMinistry ofTransport. TheNational Transport Company (ONT), apublic establishment,
levies feesonTIRcontracts involving national roads; other feesarealsolevied.36
102. AccordingtotheauthoritiesTIRisarecentactivityinMorocco.Thecountryhassignedbilateral
agreements toensure thatdomestic firms haveashare ofthedomestic market andtopromote bilateral
cooperation inthesector. Consequently, Morocco doesnotapply theMFN principle tointernational
roadtransport. Thisexemption isregistered onthefinallistofMFN exemptions submitted byMorocco
under Article IIoftheGeneral Agreement onTrade inServices.37
(v) Financial services
103. TheMoroccan banking system comprises 41banking establishments. Currently, theMinistry
ofFinance setsthemaximum lending rate,theminimum deposit rate,compulsory outlays (including
compulsory reserves) andprudential regulations. TheBank Al-Maghrib isresponsible forenforcing
regulations andsupervising banks. Itsstatutes allow ittosettheterms onwhich itrefinances thebanks.
104. Aspartoftheliberalization andmodernization ofthebanking system, anewlawwhich came
intoforceinJuly1993established theprinciple oftheuniversal bank. Foreign banks wishing tobecome
established inMorocco aresubject tothesame approval andmanagement requirement asMoroccan
banks. Currently, foreign shareholders havemajority holdings infiveMoroccan banks. Thereform
alsocovers protection ofdepositors, inparticular through theestablishment ofaCollective Deposit
Guarantee Fund financed fromthecontributions ofcredit establishments which receive public funds.
35World Bank (1994a), based onthe"Etude descoûts desfacteurs" produced bytheGeneral Economic
Federation ofMorocco (CGEM).
36According totheWorld Bank (World Bank, 1994a), theONT levies a6percentfeeonthevalue ofall
suchcontracts. Costs relating tothevarious formalities areestimated tobeapproximately 10percentofthe
costofheavy goods transport.
37GATS/EL/57, April 1994.WT/TPR/S/8 Trade Policy Review
Page 76
105. Anoffshore finance market hasbeenestablished inTangier forbanks andcompanies dealing
inportfolio management andacquisition ofholdings. Only branches andsubsidiaries ofbanks of
international repute maybeestablished there, andtheymusthaveaminimum capital orendowment
ofUS$500,000. Offshore banks areexempt from registration feesandstamp dutyontheofficial
documents establishing theircharters, increase incapital andacquisition ofbusiness premises. They
arealsoexempt from VAT oncapital goods andequipment necessary fortheiractivities andfrom
import duties andtaxesonequipment, moveable property andcapital goods needed fortheiroperations.
Dividends distributed toshareholders, interest oncustomer deposits andinvestments, andinterest on
loansfromoffshorebanksarealsoexemptfromallcharges.Threeoffshorebanksarecurrentlyoperating
inTangier, andthere isastock exchange inCasablanca.
106. Under theGeneral Agreement onTrade inServices Morocco hasbound market access by
commercialpresenceonareciprocalbasisforallfinancialservices(exceptinsurance).Moroccoreserves
therighttolimitparticipation offoreign capital inlargebanking establishments where thiswould lead
toatake-over.38Newcredit establishments maybesetupfreely provided thattheyobserve prudential
regulations. Cross-border supply isbound forloans tofinance investment andcommercial transactions
andforguarantees andcommitments. Supply andtransfer offinancial information andsimilar services
arebound without limitations, regardless ofthemode ofdelivery, subject tothesupplier being alegal
person. Residents mayacquire foreign stocks andshares, subject toauthorization andinaccordance
withexchange regulations.
107. With regard toinsurance, twostateowned enterprises areonthelistofcompanies tobe
privatized. Morocco 'srevised listoffinancial service commitments requires allinsurers tohavea
registered place ofbusiness inMorocco. Allreinsurance companies arerequired todraw upa
reinsurance planunder existing regulations oninsurance, reinsurance andexchange andsubject to
assignment ofoperations totheCentral Reinsurance Company. Commercial presence forreinsurance
activities isnotsubject torestrictions. GAN, AGF, UAP andZurich Assurance aretheforeign
companies withshares intheequity ofMoroccan insurance companies.
108. AsofJanuary 1994, VAT onfinancial operations hasbeenreduced from14to7percentand
taxes ondividends from stock market operations havebeenlowered from 15to7.5percent.
38Article 24oftheMoroccan Banking Lawdefines atake-over asthefaculty ofanyshareholder, whether
anaturalorlegalperson,toinfluenceinadecisivemanner,aloneortogetherwithothershareholders,thedecisions
ofanestablishment 'sGeneral Assemblies andBoard ofGovernors, byreason ofhisshare inthecapital orhis
voting rights.