{"id":80549,"date":"2024-08-22T00:00:00","date_gmt":"2024-08-22T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/logistics\/2024\/08\/22\/how-morocco-is-becoming-a-nearshoring-hub-for-european-firms\/"},"modified":"2024-08-22T00:00:00","modified_gmt":"2024-08-22T00:00:00","slug":"how-morocco-is-becoming-a-nearshoring-hub-for-european-firms","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/logistics\/2024\/08\/22\/how-morocco-is-becoming-a-nearshoring-hub-for-european-firms\/","title":{"rendered":"How Morocco is becoming a nearshoring hub for European firms"},"content":{"rendered":"

Is Morocco the missing link for EU trade growth? <\/strong>Sitting on the periphery of the EU, Morocco is being considered as an alternative sourcing location by 4% of European firms, according to a report by Danish shipping firm Maersk<\/a> last month. The EU is Morocco\u2019s leading trade partner, while Morocco is the EU\u2019s 21st biggest trade partner<\/a> \u2014 representing 1% of the EU\u2019s total trade in goods. So, what does Morocco represent for European business and how can the North African country redefine trade relations?<\/p>\n

(** Tap or click the headline above to read this story with all of the links<\/strong> to our background as well as external sources.)<\/p>\n

Why are European firms diverting? <\/strong>Over 64% of European companies have changed their mechanisms and locations for sourcing materials, largely due to supply chain disruptions, according to a sourcing whitepaper<\/a>. In addition to shortening supply chains by finding close markets, the firms are also looking for flexibility and reducing reliance on a single source of materials. <\/p>\n

SOUND SMART- What is sourcing? <\/strong>Sourcing involves the process of identifying, evaluating,<\/a>and selecting<\/a> suppliers to offer goods and services. The process often impacts cost, quality, and accessibility of products and services. Firms often try to secure reliable and cost-effective suppliers to ensure a stable flow of materials. There are several types of sourcing, including outsourcing, insourcing, near-sourcing, global sourcing, and single sourcing.<\/p>\n

In numbers: <\/strong>The total trade in goods between the EU and Morocco amounted to<\/a> EUR 53.3 bn (USD 58.2 bn) in 2022. The EU\u2019s imports from Morocco amounted to EUR 21.7 bn \u2014 led by transport equipment at EUR 5.1 bn, machinery and appliances at EUR 14.4 bn, mineral products at EUR 4.9 bn, and transport equipment at EUR 3.5 bn. The diversity of goods exported makes Morocco a potential sourcing hub for several European industries that seek cost-effective partners.<\/p>\n

Close, and not just geographically: <\/strong>Morocco\u2019s close proximity to Europe is a driving force for European countries to choose it as a trading hub. Morocco and the EU established a Free Trade Area<\/a> over the past two decades as part of the EU-Morocco Association Agreement<\/a>, and signed an agreement on additional liberalization of trade in agricultural products over a decade ago. Under the EU Trade Policy Review<\/a>, the EU offered to discuss trade modernization and investment relations with Morocco to help them adapt to challenges. <\/p>\n

Morocco\u2019s Tanger Med is in its top form: <\/strong>Morocco\u2019s Tanger Med Port was among<\/a> the top 20 container ports in 2023, ranking nineteenth worldwide with 13.4% y-o-y growth in volumes in 2023. It handled some 8.6 mn TEUs throughout last year. Serving as a crossroads between Europe and Africa, the Moroccan port has emerged as a solid contender for multinational companies looking for nearshoring operations, according to a report by the Financial Times\u2019 fDi Intelligence<\/a>. \u201cInvestors can reach Europe easily and relatively fast\u2026labor is still cheap on a relative basis, and there\u2019s good infrastructure and tax incentives. So there\u2019s an opportunity for Morocco to attract more investment and within this potential for [growth] Tanger Med plays a big role,\u201d mission chief at IMF Roberto Cardareli said. <\/p>\n

Building bridges: <\/strong>Maersk established the Morocco Bridge Solution last year \u2014 a multimodal service that connects Morocco with Spain and the rest of Europe. The solution connects rail and truck transport across Morocco to a maritime shuttle from Tangier to Algeciras. The route aims to drive the growth in trade between Morocco and the EU by reducing congestion and carbon emissions without compromising time-efficiency. <\/p>\n

Nearshoring on the rise:<\/strong> European business have been showing increased willingness to trade with Morocco and African nations. The number of trucks crossing from Morocco to Spain and France has seen double-digit growth. However, ferry services could not maintain growth, which led to congestion, high carbon emissions, and increased job market pressures for drivers. <\/p>\n

A gateway not just for Europe:<\/strong> Morocco\u2019s Dakhla Port \u2014 set to kick off<\/a> operations in 2030 \u2014 will aim to serve as a gateway to the Atlantic for African Sahel countries. The initiative aims to enhance<\/a> Sahel countries' access to the Atlantic Ocean by providing them with access to Moroccan port and rail infrastructure. France has expressed interest<\/a> in funding a 3 GW power cable linking the Moroccan city of Casablanca to the town of Dakhla while French independent power producer HDF Energy has partnered<\/a> with Moroccan investment holding company Falcon Capital Dakhla to establish a green hydrogen production facility in Dakhla.<\/p>\n","protected":false},"excerpt":{"rendered":"

Several European firms are eyeing Morocco as a potential sourcing destination for trade<\/p>\n","protected":false},"author":1,"featured_media":80550,"comment_status":"","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[41],"tags":[150,32],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-80549","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-trade","tag-morocco","tag-trade","wpautop","entry"],"acf":{"mongo_id":"03306c26-b9c8-43de-94e4-008206e90e9c","order":"6","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/4\/170.jpg","photo_position":"above","homepage_title":"","full_issue_title":"How Morocco is becoming a nearshoring hub for European firms","related_issue":[80539],"teaser":"Several European firms are eyeing Morocco as a potential sourcing destination for trade","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/8\/.5365d562-b6af-415e-a217-7e85daf01097.mp3"},"yoast_head":"\nHow Morocco is becoming a nearshoring hub for European firms - 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