MOROCCO

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o Introduction & Facts (Flag/Map/Numbers) o History
♣ Ancient
♣ Modern o Political Environment
♣ Government
♣ Political Conditions
♣ Military o Economic Environment
♣ Economy
♣ GDP♣ FDI o Regulatory Environment o Technical Environment o Cultural Dimensions
♣ Social
♣ Business
♣ Religion
♣ Language o Business Environment
♣ SWOT Analysis
¬ Regional Conclusion: 1 page
¬ References
Conclusion

Sources

Geographic/population:

MOROCCO
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https://www.cia.gov/library/publications/the-world-factbook/geos/mo.html
The

Location Morocco is in the north of Africa it is next to the Atlantic Ocean and the Mediterranean Sea, between Algeria and Western Sahara. It is slightly larger than state of California (446,550sq. km, and 172,413 sq mi). The main cities are Rabat, Casablanca, Marrakech, fees, Meknes, and tangier. In a country like Morocco the expectation of a tourist view as in term of traveling sites are lots of mountains and deserts. The land is 19% Arable land, 2% permanent crops and 79% as other.

Population/ethnicity

As of 2009 the estimation of the population is 34,859,364 with an annual 20.96% birth rate/1000 population and a 5.45% death rate /1000 population. The ethnicity groups are 99% Arab –Berber, 2% Jewish and 0.7% as other. The main religion is 98.7% Muslim, 1% Christian and 2% Jewish. The wide spread language is Arabic but French is mainly spoken when conducting business and government. The average person 15yrs of age and older can read write.

History: Ancient History In the ancient history of morocco it had many cultures and religions, but the original people of this place were the Berber people. They did not have a fix economy neither a government, instated they had tribes and each tribes had their own leader. This Country did not have a uniform authority, so, in the early years of its devolvement they were constantly attacked or invaded. Many groups succeed but also defeated by a different group. They were first attack begin in the century B.C. by the Phoenicians, they hade success claiming the coastal settlements. The second invasion was by the Carthaginians who defeated the Phoenicioans and later they too were defeated by the Romans. In time the Romans weakness allowed the Arabs to move in and take over. Now there was left the Jews and the Arabs to defeat each other to determine who takes control over Morocco. According to morocco.com/culture/ancient-morocco/ in order for the country to regain stability, a man by the name of Ahmed I al-Man-Sur managed to bring stability to the country during his dynasty. As a result the country flourished between 1579 and 1603 as Jews and Moors from Spain settles in Morocco. After many battles among different ethnic and groups over who will control Morocco, France and Spain finally had a piece of the land. In 1912 France took control of most part of Morocco and the remaining for Spain, however, in the 1930s the country became more militants, as a result in 1956 Morocco regained its independence.

Political environment:
The government Morocco is a kingdom country, the king name is H.M. King Mohammed VI. He has rule Morocco since the death of his father in July 1999. Based on moroccamericantrade.com, the current government is supported by a bicameral parliament whose lower house consist of 325 members in the Maijis an-Nuwad (chamber of representatives) elected by popular vote for five years terms: and they have 270 –seat Chamber of Advisors in the upper house and those members are chosen for 9 year terms in which they are responsible for writing laws and earmarking funds for any situation relating to the society and the economy.

Type of government: Constitutional monarchy. Constitution: March 1972, revised 1980, 1992, and 1996 (creating a bicameral legislature) Branches: Executive-king (head of government). Legislative-bicameral Parliament Judicial-Supreme Court Major political party of Authenticity and Modemity, Istiqlal party, party of justice Development, Social Union of popular Forces, National Rally of independents, Popular Movement, constitutional Union party, party of progress and socialism. Suffrage: Universal starting at 18 years of age.

Political condition

The constitution of Morocco is a weak one because the King has too much control of its parliament and the Judicial Branch. The king appoints the prime minister and following all other members in the government. The king has the power to overrule an election as he pleases. And he does not like to hear the public opinions. On August 1 2009 According to an article from globalpost.com, the government seized more than 100,000 copies of publications that dared print the results of an opinion poll showing 91 percent of Moroccans approve of their king. The government’s explanation.

Military:

The Moroccans armed force consist of six branches; Royal Army, Royal Moroccan air force, royal Navy, royal gendarmerie, and the royal guard.
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Royal Army
The Royal Army consist has main commander, one is responsible for the north zone, and the second is for the southern zone. Base on global secutiry.org, these commands control three mechanized infantry brigades, one light security brigade, two paratroop brigades, and eight mechanized or motorized infantry regiments. Independent units include one armored battalion, two cavalry battalions, 39 infantry battalions, one mountain infantry battalion, two paratroop battalions, three motorized (camel corps) battalions, nine artillery battalions, seven engineering battalions, one air defense group, and seven commando units. The army also provides security in courts, airports, and they also have a military police. Royal Moroccan Air force The air force was formed in 1956, its inherent are mostly from the United States and France. Today Moroccan force still supplied by U.S relying on most airfcraft purchases and helicopters. Royal Navy The Royal Navy has many branches in Morocco including, Agadir, Al Hoceima, Dakhla, Kenita, Safi, Tangier and currently they building a new base in Ksar Sghir.

Royal gendarmerie The royal Gendarmerie was founded by King Mohammed V in 1957. This type of official was created to guarantee public safety and order. They have different variety of duties such as; judicial and military policing to ensure the implementation of the law. Within this military branch there are two other types of policing; General Administrative police and the Special administrative police. The Royal guard The Royal guard is a division of the Moroccan Army. Their main task is to protect the king and provide security for his family. The troops are a large groups of 6000 members who also confirm that the majesty is accompanied by some the members of the guards at all time. In 2003 it was estimated that the Moroccan government spent 5% of their GPD in the military force. Below are the facts from The WORLD FACTBOOK:
Military service age and obligation:
18 years of age for compulsory and voluntary military service; conscript service obligation - 18 months (2004)

Manpower available for military service: males age 16-49: 9,152,580 females age 16-49: 9,080,830 (2008 est.)

Manpower fit for military service: males age 16-49: 7,779,589 females age 16-49: 7,881,024 (2009 est.)

Manpower reaching militarily significant age annually: male: 356,014 female: 343,520 (2009 est.)

country comparison to the world: 19

People and Culture:
The People In anywhere in the world where there is business there is human involvement. However, different cultures have different attitudes towards work, time, materialism, individualism, and change. 1. Work: the attitude of work in morocco I assumed is different from the American culture. Based on a study by “Blogspot.com. Duncan goes to Morocco” Moroccans works very hard but not as much as Americans. Duncan’s worked with doctors for two weeks and they would work from 9 or 10 until 2 or 3 and call it a day. Work on the farm is obviously different from white-collar work, but it was the same attitude that can be applied to blue-collar work in Morocco. 4 or 5 hours is a solid day’s work. 2. Time: The attitude towards time would be the obvious one based on Duncan’s study, 4 to 5 hours is a solid day’s work in Morocco. This could be very crucial for an American business man, where everything is based on time, matter of fact in the United States good percentage of companies depends on the type we tend to work around the clock. New York City would be a good example of how time matter really matter to American. If a country like Morocco considers 4 to 5 hours as a solid work days obviously there could be a conflict for an American business. 3. Materialism: Companies who are in the sale of fashion clothing might not succeed In Morocco, since many men and woman wears long dress over their regular clothing. This type of materialisms would not be a successful one if your intention is to fashion a place like morocco whose beliefs is Islam. 4. Individualism: This defined how important people look after themselves and their family and their personal achievement. Conducting business in Morocco an organization should consider who they are doing business with as an individual; does this person have a family (wife and kids) and what is the expectation of this person? 5. Change: Although many Moroccan would like to see some changes in Morocco, it is almost impossible to conduct certain type of business because of its lack of resources such as water and too much illiteracy.

Culture An import aspect of doing business in a foreign country is known the people and their culture. Culture are the values shared by group of people or society, in other word, if a n organization plans to engaged in some type of business transaction in a foreign land, they must first do their research to find out what are those important values that really matter to that country or the people they attempt to business with. There are three type of culture variable a company must know about Morocco culture: Values, Norms, and beliefs. 1. Values: In morocco 98% of population are Muslims, which describe that there are days and times when they can’t discuss or involve in business transactions. According to “questia.com” In terms of social values, Moroccans share some characteristics with the rest of the Arab world (e.g., Islamic values, Bedouin values and norms hospitality, pride, courage. 2. Norms: This indicates the way a country do things, for example, the way they dress, their speech, and appearance. And these norms vary from age’s group to social class and social groups. Luckily for Americans, if a person wants to involved business with Morocco the dress code is pretty much the same as the united state. Men dress with suits and ties and the can also their suits, this may not apply for other culture who does wear suits and ties. 3. Beliefs: This will always play a big part anywhere in a Muslim country. The belief of Islam is very large and respected by many.

Business culture: It is very important to note that the French once ruled Morocco and left its influences behind. The languages that is spoken is Arabic, however when conducting business the key language is French. Obviously if a person plans to deal with that country the represenatative would have to speak the business language (French). Some cases others might select to speak either English or Arabic but chances are very slim. When conducting business with a Moroccan it essential to know the importance of the following four key factors; Religion, relationship, value, honor. 1. Religion: this is very important to note that 98.7% of the population is Muslims. Therefore, this can cause a decrease in profit for some organization. In Morocco all business are close on Friday afternoons for prayers, and there is a holiday call Ramadan which fall on the ninth month of the Islamic calendar. According to “Wikipedia .com” during Ramadan Muslims refrain from eating, drinking, having sex, smoking, and indulging in anything that is in excess or ill-natured; from dawn until sunset. 2. Relationship: Similar to many cultures, before agreeing a business transaction with a Moroccan, you first have to build a friendly relationship, because parts of their culture are very family oriented. As an American businessmen don’t expect business as usual. Take your time to gain a Moroccan trust. 3. Value: The Moroccans have a strong sense of value about respect; they believe you must respect yourself and your elders. They are considerate of others, so, as for businessmen, be careful not be rude towards a Moroccan.

4. Honor: is essential to Moroccans. Dignity and self worth are especially importance so Moroccan’s take notice of how others perceive them. Shame is to be avoided at all cost; So Moroccans will often do as much as possible to win the respect of others and to avoid arguments and confrontation. I would strongly encourage any investor who select to business in Morocco to spend at least a month or two to learn the ways of the Moroccan business culture. While it might be benificial to some others it might a perfect lost. The importance of religion, relationship, value, and honor are major key factors.

Economy: The economy in morocco is not at standard, however over recent years they have improved. In 2003 King Mohammed brought macroeconomic stability to the country with low inflation, he has improved financial sector performance and proven progress in developing the services and industrial sectors. The King has improved social welfare through rural electrification program. In addition he improved the poor with decent housing. A critical issue with Morocco is that there are too many illiteracy people the educational level there is to low causing high rate in unemployment. According to The CIA Facts In 2006, Morocco entered a Free Trade Agreement (FTA) with the US, and in 2008 entered into an advanced status in its 2000 Association Agreement with the EU (CIA FACTS). Despite all the facts the country economy, there are great business opportunities in morocco. Each country has its advantage and disadvantage.

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Advantage AS a business major I believe there are always opportunities in each of every country, regardless of their economic situation An example of an advantage in doing business in morocco: According to Washington, DC — Morocco was the top reformer in the region on the ease of doing business in the Middle East and North Africa in 2005-2006, according to a new report by the World Bank and the International Finance Corporation (IFC). Morocco cut the cost of starting a business, complying with tax regulations, and doing property transfers, all measures that can help support job creation-an urgent challenge across the whole region. (All Africa.com). Another advantage in conducting business in morocco is its great cities. The country has about five main attractive places: Marrakesh, Meknes, Fes, Tangier, and Casablanca. What mainly stabilize t the economy for these cities are its attraction to the tourist, which means the idea of investing in a business such as restaurants, hotels, night clubs and real estate’s is profitable.

Here are some advantage pictures of Morocco’s economy. Marakesh [pic]

Meknesh [pic]

Fes [pic] Tangier [pic] Casablanca [pic]

Disadvantage The disadvantage would be the obvious if investor decides to invest anywhere outside the main cities, then it would have to suffer the consequences. Outside the main cities the economic benefits reduces. Since there is no reliance on visitors and 15% of the Moroccans population is below poverty level, your consumers would be a small number, and therefore it results to a decrease in profits. Here are some pictures of a disadvantage economy in Morocco [pic] [pic]
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The Moroccan economy compared to many other countries is on the rise for improvement. Below is the sculpture of Moroccan today’s economy provided by The WORLD FACTBOOK.

GDP
$146.7 billion (2009 est.) country comparison to the world: 59
$139.6 billion (2008 est.)
$131.5 billion (2007 est.) note: data are in 2009 US dollars

GDP (Official exchange rate)
$90.78 billion (2009 est.)

GDP- real growth rate
5.1% (2009 est.) country comparison to the world: 23
6.2% (2008 est.)
3.2% (2007 est.)
GDP – per capita
$4,600 (2009 est.) country comparison to the world: 146
$4,500 (2008 est.)
$4,300 (2007 est.) note: data are in 2009 US dollars

GDP – Composition by sector agriculture: 18.8% industry: 32.6% services: 48.6% (2009 est.)

Labor force
11.46 million (2009 est.) country comparison to the world: 43

Labor force- by occupation agriculture: 44.6% industry: 19.8% services: 35.5% (2006 est.)

Unemployment rate
9.9% (2009 est.) country comparison to the world: 114
9.6% (2008 est.)

Population below poverty line
15% (2007 est.)

Houselhold income or consumption by percentage share lowest 10%: 2.7% highest 10%: 33.2% (2007)

Distribution of family income - Gini index
40.9 (2005 est.) country comparison to the world: 58
39.5 (1999 est.)

Investment (gross fixed):
32.5% of GDP (2009 est.) country comparison to the world: 16

Budget: revenues: $22.9 billion expenditures: $23.86 billion (2009 est.

Public debt:
54.1% of GDP (2009 est.) country comparison to the world: 40
55.6% of GDP (2008 est.)

Inflation rate (consumer prices):
2% (2009 est.) country comparison to the world: 69
3.8% (2008 est.)

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Central bank discount rate:
3.25% (24 August 2009) country comparison to the world: 129
3.32% (31 December 2008)

Commercial bank prime lending rate:
6.5% (31 December 2008)

Stock of money:
$72.37 billion (31 December 2008) country comparison to the world: 19
$67.42 billion (31 December 2007)

Stock of quasi money:
$19.84 billion (31 December 2008) country comparison to the world: 47
$16.23 billion (31 December 2007)

Stock of domestic credit:
$84.9 billion (31 December 2008) country comparison to the world: 43
$71.9 billion (31 December 2007)

Market value of publicly traded shares:
$65.75 billion (31 December 2008) country comparison to the world: 51
$75.49 billion (31 December 2007)
$49.36 billion (31 December 2006)

Agriculture - products: barley, wheat, citrus fruits, wine, vegetables, olives; livestock

Industries: phosphate rock mining and processing, food processing, leather goods, textiles, construction, energy, tourism

Industrial production growth rate:
1.9% (2009 est.) country comparison to the world: 57

Electricity - production:
19.78 billion kWh (2008 est.) country comparison to the world: 71

Electricity - consumption:
20.78 billion kWh (2007 est.) country comparison to the world: 68

Electricity - exports:
0 kWh (2008 est.)

Electricity - imports:
3.429 billion kWh (2009 est.)

Oil - production:
4,310 bbl/day (2008 est.) country comparison to the world: 97

Oil - consumption:
187,000 bbl/day (2008 est.) country comparison to the world: 60

Oil - exports:
17,420 bbl/day (2007 est.) country comparison to the world: 93

Oil - imports:
195,800 bbl/day (2007 est.) country comparison to the world: 47

Oil - proved reserves:
750,000 bbl (1 January 2009 est.) country comparison to the world: 97

Natural gas - production:
60 million cu m (2008 est.) country comparison to the world: 81

Natural gas - consumption:
560 million cu m (2008 est.) country comparison to the world: 94

Natural gas - exports:
0 cu m (2008 est.) country comparison to the world: 152

Natural gas - imports:
500 million cu m (2008 est.) country comparison to the world: 59

Natural gas - proved reserves:
1.501 billion cu m (1 January 2009 est.) country comparison to the world: 97

Current account balance:
-$3.795 billion (2009 est.) country comparison to the world: 167
-$5.836 billion (2008 est.)
Exports:

$15.61 billion (2009 est.) country comparison to the world: 70
$20.17 billion (2008 est.)

Exports - commodities: clothing and textiles, electric components, inorganic chemicals, transistors, crude minerals, fertilizers (including phosphates), petroleum products, citrus fruits, vegetables, fish.

Exports - partners:
Spain 19%, France 17.4%, Brazil 7%, US 4.5%, Belgium 4.4%, Italy 4.2% (2008)

Imports:
$31.83 billion (2009 est.) country comparison to the world: 55
$39.35 billion (2008 est.)

Imports - commodities: crude petroleum, textile fabric, telecommunications equipment, wheat, gas and electricity, transistors, plastics

Imports - partners:
France 16.2%, Spain 13.6%, Italy 6.5%, China 6.1%,
Germany 5.7%, Saudi Arabia 5.4%, Moldova 5% (2008)

Reserves of foreign exchange and gold:
$21.54 billion (31 December 2009 est.) country comparison to the world: 40
$22.72 billion (31 December 2008 est.)

Debt - external:
$20.06 billion (31 December 2009 est.) country comparison to the world: 65
$17.13 billion (31 December 2008 est.)

Stock of direct foreign investment - at home:
$42.68 billion (31 December 2009 est.) country comparison to the world: 54
$42.68 billion (31 December 2009 est.)

Stock of direct foreign investment - abroad:
$641 million (31 December 2009 est.) country comparison to the world: 71
$966 million (31 December 2008 est.)

Exchange rates:
Moroccan dirhams (MAD) per US dollar - 8.064 (2009)
, 7.526 (2008), 8.3563 (2007), 8.7722 (2006),
8.865 (2005)

Government and Politics:

A major issue in doing global business is government risk. Many questions are to be answered and resolved before closing a deal in foreign soil.

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