“There will be no revision of the free trade agreements (FTA)”, this is what emerges from the interview recently granted by Ryad Mezzour, Minister of Industry and Trade, to the journalist of the Lebrif site .my.
According to him, “these agreements have breathed dynamism into our economy” and “have contributed to accelerating the pace of exports”, thus enabling Morocco to move from “0.12% in the world market for merchandise exports in 2006, to 0.17% in 2021, an estimated improvement of 41%”.
The Minister believes that this issue deserves particular attention because of the competitive advantages it can provide to the national sector of industry.
Measures
And what regarding the aggravation of the trade challenge, the competitiveness of national companies and the access of Moroccan goods to foreign markets? While imports grew much faster than exports following the signing of the FTAs, Morocco’s trade deficit widened with all partners.
For the Minister, there are “trade defense instruments” aimed at “correcting the market distortions that the various sectors such as steel, textiles, the plastics industry or even the wood industry may suffer”. And what are these measures? Ryad Mezzour puts forward as an example the planned merger of a negative list of more than 1,200 products in the appendix to the free trade agreement between Morocco and Turkey or that of the bilateral consultations carried out with the Egyptian party allowing Renault cars produced in the Tangier region to access this market with total exemption from customs duties. Or the establishment of a new agreement between Morocco and the United Kingdom post-Brexit.
Amnesia
However, the minister forgets or seems to forget that Morocco has signed nearly sixty free trade agreements since 1996 with 56 countries. It has done so in particular with the member countries of the European Union within the framework of the Euro-Mediterranean Partnership; with Switzerland, Norway and Iceland within the framework of the European Free Trade Association (in 2000), with Turkey and the United States (in 2006), with 18 Arab League countries within the framework the Greater Arab Free Trade Area Agreement (in 1998), with Tunisia, Egypt and Jordan, first separately and then together under the Agadir Agreement (in 2007) and with the United Arab Emirates (in 2003). Agreements which have certainly enabled Morocco to equip itself and to export more, but its imports have grown much faster than its exports.
Thus, exports with the EU, Morocco’s main partner, increased from 59.4 billion DH in 2001 to 182.5 billion DH in 2018. That is an increase of 123 billion. But opposite, imports went from 70.6 billion DH to 260.7 billion. That is an increase of 190 billion.
The trade deficit with the EU has therefore been multiplied by seven, from 11 billion DH to 78 billion. The same observation is valid for the United States (trade deficit of 25 billion DH in 2018), Turkey (16 billion DH) and the countries of the Agadir Agreement (more than 5 billion DH).
Inefficiency
The minister also seemed unaware that the said measures taken did not have a decisive effect, as evidenced by that of the free trade agreement with Turkey. Concretely, if the two parties agreed to integrate into the initial agreement a negative list of more than 1,200 local products suffering the impact of Turkish imports and a possible annual evaluation of the said list, Ankara has been able to develop a whole know-how which allows him to circumvent the measures taken once morest him.
In a previous edition, Hicham Attouch, economist, told us that the results of this review were mixed since Morocco has gained nothing and lost nothing either. “If Morocco is a winner in terms of employment, it is a loser in terms of exports. Indeed, a closure of the Turkish chain of stores Bim will have unfortunate consequences in terms of employment”, he underlined.
Report
Our interlocutor told us that there is no real desire to revise the FTAs from top to bottom. According to him, there will certainly be touch-ups to fill in the gaps or provide additions. But, this is by no means an in-depth review. And for good reason ? “The international context and the nature of relations with these countries do not allow such a review,” he said.
Indeed, political logic guides Morocco’s position regarding these free trade agreements and Rabat has always opted for the logic of agreement and not that of rupture. Especially in the current context where the situation is confused at the level of international trade. And to conclude: “Especially since this question is not among the priorities of the current Executive which today gives all its attention to two files, namely that of public companies and establishments and that of social security. Indeed, neither the government program nor the finance law mentions any change in this direction”.
Hassan Bentaleb
