Due to sluggish trade and investment in 2009, the Board of Investment (BOI) has officially launched a policy of encouraging Thai investment abroad in 2010 to increase our international investments and enhance trade in foreign markets. KASIKORN RESEARCH CENTER (KResearch) views that Morocco has an economy with bright investment potential because it is the Africa's fourth largest investment destination.
During 1997-2007, Morocco's economy posted average growth of 4.5 percent a year. In 1Q09, it grew 3.7 percent YoY, with projected growth of 5.4 percent in 2009, thanks to the global recovery. Due to their potential in trade and investment, Morocco could serve as a distribution hub for Thai exports (before onward shipping) into Africa, Europe, the USA, Middle East, etc.
KResearch views that our exports to Morocco will decelerate only short-term in line with their domestic economic slowdown. During 8M09, our exports to Morocco contracted 28.7 percent. Nevertheless, our opportunity for exports to this country should improve in the future. Although the current value of trade between Thailand and Morocco is quite low, rising demand there and from key trade partners such as Europe, the USA and Middle East would support higher trade.
In addition, Moroccan decreases in tariff rates in 2009 to an average of 20.2 percent from 33.4-percent in 2002 will benefit our exports of industrial goods and ore that are assessed the relatively low tariff rates of 19.9 percent and 9.1 percent, respectively. Our exports of farm are charged a high tariff of 29 percent (compared to other products) in the Moroccan market. In addition, our exports of intermediate goods serving their domestic production get a relatively low tariff of 16 percent and the tariff of exports of raw materials and instant foods get 21.5 and 23.4 percent, respectively.
A bright future also lies ahead for other Thai exports, such as vans, pick-up trucks, passenger car parts, TV receivers, refrigerators, washing machines/dry-cleaning machines, canned tuna, live fish, fruit, yarn/synthetic filaments, fabric made of synthetic filaments, toys, cosmetics, soaps, motorcycle parts, etc.
Morocco is now opening their country to local and foreign investors in tourism, construction, telecommunication, transportation and production in order to support Moroccan development. Tariff reductions on raw materials and intermediate goods are helping to spur those investments. KResearch is of opinion that Thai businesses that could thrive there would include:
Fishery business – They have good fishing grounds, but lack processing facilities.
Construction – Moroccan authorities' economic stimuli and development plans to attract investors into low-priced housing construction and sub-contracting in mega-projects with European investors.
Thai spa and restaurants – These businesses can grow with their tourism industry. Many tourists in Morocco like Thai spas and food.
Nevertheless, there are many barriers to new business operations in Morocco, such as rigid regulations relating to labor, limitations in shareholder rights, time-consuming business procedures such as the length of time for business registrations, tax payments, high fees for trade agreements, red tape and too much required documents on imports and exports. Thai business expansion in Morocco would benefit our exports of food ingredients, farm tools and machinery, iron, construction business and cosmetics/soaps because they are all necessary there.