In just half an hour’s drive, the journey south from Tangier’s ancient city spans decades’ worth of economic progress. It winds through hills where sheepherders tend to their flocks and then descends into a valley, which is home to Africa’s largest car-assembly plant.
This burgeoning zone of industrial development is a place where businesses on both sides of the Cold War can thrive. Morocco, like other key emerging economies, wants to maintain this status quo, even though it won’t always be easy.
Western corporations have already moved in and are still moving, riding the wave of near-shoring. The 1,500-acre Tanger Automotive City is located just across the expressway, from Renault SA’s 8,000-employee facility. It hosts dozens companies such as Michigan-based seating manufacturer Lear Corp. China has now increased its global presence in an effort to expand into more markets. The fiber-optic cables producer ZTT Group is one of the newer players in the auto cluster. It’s a key player in Beijing’s Belt and Road plan, which aims to connect the world with infrastructure. The Moroccan kingdom and battery manufacturer Gotion High-Tech Co. inked a memorandum-of-understanding last month to build the largest factory for electric-vehicle-batteries in the world.
In an interview conducted earlier this month, Ahmed Bennis said that many Chinese companies are now considering Morocco. “Some announcements will be announced very soon,” Ahmed Bennis stated.
Many of these companies are located in Tanger Tech City. This “smart” city includes public infrastructure, residential zones, and tourist facilities.
Bennis stated that initially, Chinese companies were interested in expanding into Vietnam or South Asia. “Now, they’re looking at Morocco.”
This all looks like the globalization that was widely anticipated in the decades following the end of the last superpower showdown. The escalating conflict between Washington and Beijing has left smaller economies, from South Africa to Saudi Arabia, caught in the middle and under pressure to choose sides.
Geoff Porter is the founder of North Africa Risk Consulting Inc. “They’d argue that it’s perfectly in Morocco’s right to do that, but when it comes down to it, Morocco will need to make a decision.”
Moroccan officials believe they can prevent this for the time being, because the country is located at the door of Europe and Africa. Its free trade with the US also makes it appealing to firms around the world who want to supply these markets. Tanger Med Port and Zones has been developed by the kingdom since 2001
Logistics of manufacturing in Morocco depends on the Tanger Med port deep-sea and foreign companies that are positioned to move goods. Every day, 50 to 60 truckloads of goods, operated by Greenwich Connecticut-based XPO Inc., board ferries heading across the Strait of Gibraltar into Spain.
XPO is primarily involved in shipping auto parts from China to Europe. Luis Gomez is XPO Europe’s president. He says that the company has seen its revenue in Morocco increase by 30% a year. The Tanger Med Port, with its connections and volume of trade, is helping to increase the flow. It’s also expanding with more space for container ships, and capacity for exporting cars. Some of the first Moroccan electric vehicles were waiting to be shipped on a pier.
Morocco is building a massive port near Nador in the Mediterranean, to duplicate the success of Tanger.
In recent years, the vast influence of China in maritime shipping has sparked intense debates about national security. The terminals at Tanger Med are mainly operated by Europe’s largest shipping companies, including Germany’s Hapag-Lloyd AG. Rolf Habben Jansen is the chief executive of container carrier Tanger. He said that Tanger’s location meets a variety of needs.
Tanger is a great way to move cargo out of Asia. It can be used to transport cargo into North Europe. In an interview, he stated that you can move it to Africa, the US or South America. “We would be happy to increase our investment in it.”
Morocco’s relationship to the West goes beyond trade and investment. With 37 million people and an economy the size of Mississippi’s, it’s on a This makes it eligible to receive defense and security assistance, which is useful in regional territorial disputes. These bonds make China’s strategy in the region more complex.
According to government statistics, the US surpassed France as the biggest source of foreign direct investments in Morocco last year, while China climbed into the top 10.
Two Chinese tech giants, Huawei Technologies Co. (and ZTE Corp.), which western officials fear pose national security risks, are already recruiting engineers in Morocco. If the plans for the high-tech zone are successful, by 2027 there could be 200 Chinese tech companies operating in Morocco.
Few American executives can claim to have seen the transformation of the country in the past two decades more closely than Julianne Fuman, Europe General Manager for Polydesign Systems. The company, which employs 1,600 people, makes interior trim, seating and other parts in a plant located at the Tanger Free Zone. It ships these parts all over the globe.
She said that the firm began in 2001 with 50 employees, “back then it was just empty fields with sheep grazing.” Furman believes that the geopolitical risk of a US-China conflict is real but manageable.
She said, “It is a fine balance to make one happy while making the other happier. Morocco has been able to walk this line so far.”
She lists some of the benefits that come with manufacturing in China for customers around the world: Absenteeism is much lower and turnover among employees is far less than at factories she managed in central Europe. Furman says that if Polydesign were to move to a country with higher labor costs, such as the UK, which has greater automation, it would be 10-12 times more expensive to hire workers.
There remain plenty of obstacles to an investment-recruiting campaign that’s used up about half the designated land. Morocco’s labor force, for instance, “doesn’t seem to be in a great position to meet this challenge,” World Bank economist Federica Marzo stated. The female participation rate is low. Child-care outside of families is scarce. And daily commutes can be a struggle for many workers.
For example, during shift changes, convoys are formed of buses that block traffic as employees travel to and from the Tanger plant. Around 150 shuttles are used by passengers who commute for three hours round trip each day. Morocco opened its high-speed rail in 2018, connecting Tangier to the capital Rabat and Casablanca. However, the train is not very useful for many rural Moroccans due to the price and the limited stops.
The young workforce also needs better skills. The US and China compete on the ground in two programs that started in April.
Boeing Co., a US aerospace giant, teamed up to launch a four month STEM (Science, Technology, Engineering and Math) training program with the Ministry of Youth, Culture and Communications. The program is aimed at dozens of young people aged 18 to 25. Huawei’s Moroccan branch held masterclasses with programs that aimed to improve IT skills at a local school.
Rabia Alama is the managing director of American Chamber of Commerce Morocco. She said that China has a much stronger presence when it comes recruiting and training students in Morocco. She lives close to about 150 young Chinese executives working at Huawei and ZTE. They are assimilated into the community and speak the local dialect.
She said that Huawei is, for instance, “going to universities, setting up academies and giving grants to students to go to China.” “I wish that the US would offer scholarships to students.”