Finances News Hebdo: In its study on the substitution of building materials imports, the Foreign Exchange Office speaks of 12 billion dollars of substitution in the medium term and 3 billion dollars of exports in the short term, in particular on the horizon 2026. In your opinion, where should we start?
David Toledo: You are right, the Foreign Exchange Office talks regarding two things in its study: import substitution of building materials and the rise in the export of building materials. Everyone knows our installed capabilities in all areas of building materials. Apart from the manufacture of glass, we are a country which is fortunate to have almost 100% of the building materials necessary for construction. Indeed, we have sand, gravel, reinforcing steel, cement, brick, warp, cinder block, concrete products such as joists, etc. to finishing products such as tiles, marble, wood and sanitaryware. We have very powerful installed capacities and, indeed, we already substitute for imports. Moreover, the Construction Materials Federation (FMC) brings together 14 associations and it has just expanded with the wood industries and all which concerns interior and exterior coatings and insulation products. The Exchange Office speaks of 3 billion dollars of exports. I confirm that we must start with this project. Today, we export year following year, between 580 and 600 million dollars mainly sanitary ceramics, marble, tiles.
We have already exported steel where we have a large production capacity. We can also export clinker and cement, because we have a capacity of over 22 million tonnes, whereas we only consume 12 million tonnes, that is to say a little more than half. At the level of sanitary ceramics too, we now have a capacity of 5 million pieces, whereas Morocco only needs 1.5 million pieces. Even in ceramic tiles where we currently have a production capacity of 120 million m2 per year, it is possible to do something to contain the 20 to 25 million m2 that we continue to import. In short, we still import a lot of things, because we are subject to very tough competition in the Mediterranean. The leading tile producer is Spain, our immediate neighbour. There are also the Portuguese, the Turks and the Egyptians.
FNH: What do your immediate competitors, as you say, have that you don’t have here in Morocco?
D. T. : All the countries I have just mentioned have much cheaper energy than ours and better inputs. To compete with them, we have to be supported at the export level. The Turks give subsidies to their exporters by supporting transport prices and production prices, in addition to low-cost energy. We have been promised support for energy prices for years, which never happened. Whereas today we have the most energy-intensive industries in the country. If we have better support in terms of our production costs, we can become competitive. Spanish, Turkish and other exports are at dumping prices, very low prices which do not even cover our cost prices.
FNH: Despite everything, you still manage to export. On the other hand, it is more difficult to protect the internal market from the onslaught of your competitors. Is this what explains your choice of export over substitution?
D. T. : Exactly. We have to manage to act on the cost of production in order to lower our prices. Because we suffer from price increases internationally, particularly in terms of raw materials. For example, steel billets experienced a meteoric rise due to the Russian-Ukrainian war. And regarding the scrap that we tried to fall back on to limit the breakage, we have a VAT problem with the scrap that will have to be solved so that we can use it to the maximum, instead of exporting it so that we need it. Another example: at the level of sanitary ceramics and ceramic tiles, it is necessary to support production costs and energy costs with investments in the use of natural gas. Because producers who use natural gas manage to have much better production costs than those who still use fuel oil.
FNH: How does the government respond to your complaints?
D. T. : We are waiting for important meetings, because first we want a relaunch. We want our factories to work better than today. The cement plants are now running at almost 50%. Tile producers the same, steel producers too. The only exception today is the marble industry which is experiencing significant development, as they not only export blocks, but also processed products.
FNH: What markets are you betting on to reach the export figure announced in the study in 2026?
D. T. : What we are asking for and what is important is to accelerate Morocco’s integration into the African Continent Free Trade Area (ZLECAF). This will transform our industry. For example, in steel, we managed to export to the United States, ie to a distant and demanding market in terms of quality. This means that the quality of our products and our prices are suitable worldwide. We believe that by addressing Africa, we will have several very rapid growth points. If we manage to export 500 to 600,000 tonnes, that will generate a turnover very quickly. You know, we are in heavy materials and even if the price is not very expensive at the start, it adds up very quickly. So ! The potential is there, the capacities and the know-how too. What is needed is that at some point we can, on the one hand, reduce imports and, on the other, support exports. In terms of sanitary ceramics, we have the largest exporters located in Morocco and we export all over Europe, the United States, China, Vietnam, the Middle East and Africa. It’s a sector that is very active and which might be much more so from the moment when we, too, might benefit from certain support such as Egypt, Turkey, etc.
