To date Property Secrets has very successfully tracked the path of EU enlargement. However enlargement has come to a halt with only Croatia realistically on the horizon and Croatia has largely been ‘done’. That being so it does not mean that there are not opportunities where the characteristics of pre-accession development exist although we know that accession cannot happen. So I thought I would try to make some analogies with a country where development is being driven from the very top and foreign money has assisted greatly with improving logistics and infrastructure….and the country I have chosen has a very special situation not shared with any European country…it has all the year round SUN.


As readers will know I am the strongest supporter you will find of burying Euros in Romania, Cluj Napoca in particular. But I will share with you a secret which I will open up to you because it is now winter which means it’s wet or extremely cold and in such conditions construction becomes extremely problematic…you are a prisoner to the weather.


When I moved here permanently I had a dream that would have allowed me to escape the torment of rain and snow….I was going to build in the Romanian summer and then move my few Euros to Morocco and build in the sun in the winter! I havn’t done this – yet – but it has come back on my agenda for 2008. So let me share a few ideas about Maroc and hope that PS will comment.


Now I wish to make it clear that when I am suggesting that Maroc might be a nice place to be I am not talking about Mediterranean Saidia etc which is being heavily marketed as the new Costa del Sol in much the same way that Bulgaria has been over recent years but at what I consider to be heavily inflated prices. I am not talking about Agadir…a well established summer playground for the lager lout/package holiday type. Those sort of developments will bring jobs and foreign exchange for sure so will have a knock on effect in terms of general economic development. But these developments tend to be upmarket coupled with an affordable cost of living…if sailing is your thing then marinas are high class and inexpensive or if golf is your exercise then new courses are excellent with green fees low.


Maroc has thousands of miles of beautiful coastline which makes the sea it’s greatest asset. However unlike Bulgaria and elsewhere development of tourism is being undertaken strategically with the government and more importantly the King (who has the powers of a President within a democracy) taking the lead. In summary see http: / /www .tourisme .gov .ma /english /2 -Vision2010 -Avenir /1 -en -bref /enbref .htm or otherwise just search for Vision 2010.


So how is it going? The low cost airlines are in…watch Ryanair in particular. Saidia and several others of the six designated resorts (plus numerous spin off ones) are being developed, infrastructure (roads and high speed trains) continue to be improved as are airport terminals; the proposed tunnel from the south of Spain to Maroc is at feasibility study stage. Last week Easyjet announced that as from February next year it will fly Madrid – Tangier adding to it’s routes from the Spanish capital to Casablanca and Marrakech. Over 600,000 Moroccans live and work in Spain and many Spanish feel priced out of their own holiday market It’s always best to fly in the sky when others are thinking of going underground. Watch out for new flights from the UK in the spring. A few days earlier the Maroc government announced the development of a high speed rail link from Tetouan to Casablanca to be opened by 2013 and cutting the time from just under six hours to a little over three.


In September the Maroc government finally announced that they had awarded the contract for the sixth and most southerly Plan Azur development at Plague Blanche to Fadesa, the Spanish-based international construction company. It also announced a new proposed development (and the chosen contractor at the same time) to be located at Quarzazate, the hub of Maroc’s excellent and well established film industry ("Babel", "Kingdom of Heaven", "Gladiator", "Kundun", "Alexander the Great", "Sheltering Sky", "The Last Temptation of Christ", "Cleopatra" and portions of the Star Wars films) and the gateway to the Sahara which you reach after driving down the Dades or Draa valleys with their beautiful Kasbah architecture.


What is significant and different about Vision 2010 as opposed to other ‘holiday hot spot’ development is that contracts are between international developers and the Moroccan government with the King taking an active role. This is not ad hoc development that has bought what I call planning blight to Romania. It’s a commitment to develop a tourist industry and bring employment opportunities to the Moroccan young.


The presence of Fadesa and other international developers is to be noted. Where is one of Spain’s most successful construction companies moving it’s money? The answer is Maroc for sure….and a few other places including Mexico, Poland and Romania. Fadesa in Maroc is not just about Saidia. Fadesa already has projects underway in Casablanca, Marrakech, Smir, Tangiers, Agadir and Rabat with a mixture of residential, leisure and office developments. Check out http: / /www .fadesa .es /corporativa /corpo _index .php?idioma=1 . In July of this year Fadesa signed an agreement with Addoha, the largest, real estate company in Maroc thereby giving them integrated capacity to reach a very broad spectrum of markets. See http: / /www .groupeaddoha .com/ .



Coupled with Vision 2010 the Maroc government has introduced very favourable tax regimes for foreign investors; it takes 10 minutes to open up a convertible bank account with a minimum payment of £20; and mortgages are well established and available.


An interesting fact about Maroc is that it is the only Arab country (although it is important to remember that it is Berber Arab) not to have oil revenue. That being so it is looked upon benevolently by it’s Moslem brothers and in the case of Vision 2010 has attracted financial support from the UAE particularly as concerns infrastructure and also many social housing projects.


I first went to Maroc over thirty years ago so I am aware that since that time (and wouldn’t it have been THE time to invest?) that Marrakech, an international and cosmopolitan city if ever there was one, has been done, but, like Bucharest, I ask myself whether it has further to go? With the snow capped Atlas mountains in the background and being only 2 hours drive from beautiful coast and not so far from the edge of the Sahara desert will it’s mysticism and exotic architecture continue to allure not just tourists every day of the year but an increasing number of well off who either don’t have to work or choose to live in Maroc and commute to jobs in Europe?


Don’t just note the arrival earlier this year of flights by Easyjet, RyanAir and of course the likes of Thompson and Monarch but look at the frequency of flights from Casablanca etc to European destinations such as Brussels, Paris and of course London.


Maroc remained a French protectorate until 1956. French is the business language in Maroc and spoken by just about everyone with English being a third language in tourist and commercial areas. The system of administration is easily recognisable to anyone who has lived or worked in France. The French remain a very important factor not just bringing large and small scale investment in businesses encouraged by the rules for foreigners but those of retirement age or those seeking a second home in the sun (a riad, dar or just a derelict farm house set in acres of agricultural land or at the other extreme a ksar or kasbah) find that it makes sense to invest their Euros in property in Maroc for a climate that offers sun nearly every day rather than compete with international prices in Provence (the nearest analogy to an all year sunny climate). If you are not a supporter of French investment why not follow the instinct of one of the most successful British entrepreneurs of our generation and check out Richard Branson’s Moroccan retreat at http: / /www .virginlimitededition .co .uk /KASBAH /flash .html ... and dont tell me he didn’t buy it with capital appreciation and income somewhere in the equation.


The relationship between Rabat and Casablanca can be likened to that between Washington and New York…one being the business and financial hub of the country and the other being the political capital. In these cities you will find many of the Moroccan rich and in Casablanca in particular Moroccan shanty towns as young people swarm from rural, traditional agricultural areas in search of jobs that will lead them out of a subsistence economy…a similar pattern to what is happening here in Romania.


But what is interesting is that in these cities and a few others young and educated Moroccans are establishing themselves as a new middle class. In Maroc young people face an added difficulty in making this transition…or do they? Maroc is a liberal Muslim country – favoured as a vacation destination by the oil sheiks of the middle east – which is slowly relaxing the tensions between religion, family expectations and a western influenced lifestyle…the King himself having fronted the move towards equality for women. But this process is happening here in Romania too albeit in a more obvious and dramatic way. One of my concerns about the evolution of Romanian society is that it’s new ‘bimbo’ generation don’t remember how life was under communism yet somehow the bimbos are the ultimate slaves to conspicuous consumption. They know how to spend but have no idea how to save. In Maroc values amongst this age group are somewhat different perhaps in part because families tend to be large whereas in the new Romania of the cities this is no longer the case. So in Maroc the evolution of a middle class may take longer but it’s foundations may be stronger.


Just as with Romania (and Poland etc) many young Moroccan people leave the country to work in Europe. Their remittances provide a very significant source of foreign currency which they use to invest or help their parents and family. Absolutely nothing wrong in that!


So let’s move on and look at some economic factors which may underpin future development in what is a wonderful country to live. First, free-trade agreements are in place between Maroc and both the EU ‘More than Association, less than Accession’ (go to http: / /ec .europa .eu /trade /issues /bilateral /countries /morocco /index _en .htm ) and USA (check out http: / /www .moroccousafta .com /index _ang .htm ). The EU is Maroc’s target market it being able to produce goods much more cheaply than it’s European neighbours. The EU is Maroc’s largest investor; steps are being taken to further liberalise the export of Maroc’s agricultural produce within the EU – oranges, dates, nuts, olives, lemon and lime not to forget Moroccan wine.


Inflation has been low over recent years (2.8% in 2006). Out of a population a little in excess of 30 million the potential labour force is approximately 11.25 million of whom 7.7% are unemployed (2006). Nineteen per cent of the population are believed to live below the poverty line. For Romania the same source (www.cbsnews.com/stories/2007/09/10/country_facts) quotes an inflation rate of 6.8%, an unemployment rate of 6.8% with 31.6% of those employed working in agriculture. Twenty five per cent of Romanians are considered to be living below the poverty line.


In Romania 15.6% of the population are aged 0 -14 years whereas in Maroc the figure is double at 31%. Fourteen point seven per cent of Romanians are aged over 65 compared with 5.1% of Moroccans. This points to Romania’s pensions crisis and the challenge for Maroc to improve the quality of education, create real career opportunities whilst also exposing a need for future housing stock development for aspiring young Moroccans. Note that Maroc’s birth rate is twice that of Romania. The current and potential Moroccan housing market is actually more diversified than the holiday hotspot marketeers would have us believe and the potential domestic market in simple numbers is far greater in Maroc than Romania.


So what can the nationals of these two countries actually afford? Remaining with the same data source the GDP per capita for Romania is quoted as being $9,100 and that for Maroc as being $4,600 in 2006. It wasn’t so long ago that this was the approximate figure for Romania. Hidden within these averages and other figures quoted above will be tremendous differences between both cities and regions. Cluj and Bucharest are very different to Botosani and Calarasi just as demand and markets in Casablanca and Marrakech bear no relation to those of Errachadia or Zagora. To date demand from outside the Moroccan market has been led by the French…but it’s becoming clear that with the open skies policy working for Maroc in a big way Spanish and British investors will be sowing their Euros in the Morrocan sun in a big way.


In Romania foreign investment to date has tended to be in apartment blocks and land. In Maroc the options are much more diversified. There are still many thousands of riads in Marrakech crying out for foreign investment and renovation. The same can be said of cities such as Fes. In such cities, particularly Marrakech, you will find the highest class of residential developments – both apartments and opulent villas –where you know you are paying for quality. If you want to rent the yield is very good. If you want a small business restore or convert to a pension or hotel. And of course there is such variety – skiing in the Atlas, the beginning of the Sahara….and thousands of miles of beautiful coast. My tip for 2008 would be to buy as much land as possible in the far south either at Plague Blanche ( a development which will be as big as Saidia) or Ouarzazate…the gateway to the Sahara.

Hi Charles

You have done such a great job outlining Morocco that it is deserves more than a quick reply ...

however, with xmas coming ... that is what I'll do for now.

You are right, of all African countries Morocco has the best long term prospects and fastest captial price growth in property markets.

You are also right to ignore the coast (no exit strategy) and think about the cities.

I don't think there is any reason to beleive that the key cities don't have further potential. London, it could be said, peaked in 1989 - as one of the three most expensive cities to live in or to buy property. As we all know, that didn't stop a crash in 91 nor at least two further massive price booms!

The real issue is whether we are going to run out of options in CEE in the short term? I don't really think so.

We have seen Czech Republic come back strongly this year (after an 18 month pause) and in 2008 we'll see Slovakia return. I'd slate Poland to be back on a strong growth path in 2009.

At the same time, growth in CEE markets will move from capitals to 2nd and 3rd tier cities.

So, there is plenty more growth to follow.

Equally, my money (may be, my hope) is that ex-Yugoslavia will be inside the EU within 3 to 5 years (including Serbia). There is a good possibility that Kosovo will drive Serbia into the arms of the EU rather than the arms of Russia - and the EU isn't going to miss the opportunity to gather the ex-Yugoslav states and support the pro EU supporters.

Why is this relevant?

Well, because to some degree Morocco is an investment location which makes sense if all others have been exhausted.

Which they haven't - so, for this reason Morocco remains on (but down) our list of potential future locations.

The risk in Morocco is that it will fall into a radical muslim mould - rather than emerge as pro-western.

The difficultly is that this is a political risk that it nearly impossible for anyone to predict - thereby making any property investment judgements hard to make.

It is also for this reason that our attention in 2008 will be moving to Brazil and India. Two other emerging markets with far from perfect democracies - but at least they have been able to maintain democratic rule for a large number of years and show all the signs of being able to continue to do so.

Hence, any assessment of Morocco needs to take account of the political risk - as this is principally the risk that you need to assess.

Hope this helps

thanks for the great information,also i saw that Emaar, the biggest developer in Dubai also had announced several project in Moroco, they are smart enough to go only in hot spots.http: / /www .emaar .ae /International /morocco /Index .asp.
whould any body familliar with this market can advice the mortgage and location guidance?

It was just under 12 months ago that I suggested that Maroc would be a good place to invest at the present time ( See http: / /www .propertysecrets .net /forum /where _to _invest _in _2008 _maroc _039more _than _association _less _than _accession039 /9531 /30513 .html ). I tried to make the analogy between its relationship with the EU and patterns that have preceded the accession of central and eastern European countries.

A review of that contribution has been prompted by sub zero temperatures arriving in Cluj which will bring a slow down in the work of constructors. We are dangerously close to minus 5 - the temperature at which paint cant dry - whilst Marrakech enjoys 23 degrees.

So much has happened in less than a year with property prices falling off just about everywhere in central and eastern Europe – sometimes dramatically - Latvia down some 20% and freefall in Hungary are but just two examples.

An article (http: / /www .ft .com /cms /s /0 /9da74cd0 -901a -11dd -9890 -0000779fd18c .html?nclick _check=1 ) appeared in the Financial Times last month which painted a picture of Moroccan resistance and resilience to global financial disaster. Remittances from expats working in Europe have gone up as has revenue from tourism and income from taxes.

Infrastructure continues to be developed including the deep water port of Tanger Med which upon completion will be the largest port in the Mediterranean. This has attracted the eyes of Renault Nissan who are investing $1 billion in new car production facilities on a site within the Tangier free trade zone.

I cant help but to point out the irony that Romania cant seal a deal with General Motors, Peugot or Mercedes primarily because of poor infrastructure yet we now have the likelihood of the Romanian Dacia (owned now by Renault) being built in Maroc and being floated away on the high seas to the world’s emerging markets.

The Economist (http: / /www .economist .com /business /displaystory .cfm?story _id=11703160 ) notes ‘ The Mediterranean’s southern and eastern coasts are pulling in huge quantities of foreign direct investment second only to China among emerging economies.’ I strongly urge you to read the article because it pulls together very well the direction and sources of foreign investment into the region and in a style that is far better than mine.

On October 13th, the EU granted Morocco "advanced status", reflecting the EU's decision to strengthen trade and political ties as well as to reward Morocco for its economic and democratic reform process. This reflects EU recognition of Maroc’s achievements in meeting the Chapters of the Accession Aquis – covering reforms in political structure, the rule of law and justice systems, social cohesion and the fight against poverty…and much more.

On November 5th the European Commission published a progress report (http: / /ec .europa .eu /enlargement /pdf /press _corner /key -documents /reports _nov _2008 /turkey _progress _report _en .pdf
) on Turkey’s attempts to move forward to meet accession criteria. Maroc is well ahead of the game even though it will never join!

Spain and France in particular promote Maroc’s cause within the EU. It has been postulated that Maroc may gain the benefit of a ‘common economic space’ based on the structure of the European Economic Area which may give the country access to European networks of transportation and energy. Maroc will become increasingly involved in European security coordination but one cannot see the kingdom benefiting from the (qualified) right of free movement of labour that exists for those within the EEA.

From both political and economic perspectives Maroc has achieved much over the last 12 months or so. Let’s not forget a historical perspective and maritime trade patterns over the centuries. We can go back to the Phoenicians ( see http: / /en .wikipedia .org /wiki /Image:AntikeGriechen1 .jpg for their investment map) , Greeks and Romans or more recently the colonisation of Maroc by the French with small enclaves held by the Spanish and Portuguese. The Mediterranean is a trade zone in its own right and the fact that Europe is a few miles from Maroc and Africa has never been an impediment to this.

And don’t forget Marrakech, an international city if ever there was one and previously the capital of Maroc. Ryan Air now fly there from eight locations a substantial increase from a few as was the case last year.

I’m not one for suggesting that holiday property is a wise investment but when you have the political and economic boxes ticked in a location that gets sun just about 365 days a year that’s a bonus especially when tourism as an industry in its own right is being backed by public and international money. Tourism in Maroc is about a strategy to bring FDI, create jobs and earn foreign currency.

UEA and Saudi petro-dollars continue to flow into the country. Arabs like the place not least because it is Moslem but with no issues about alcohol. The French do too with an increasingly large number choosing to retire there if only for language and climate.

I havnt mentioned property and prices. If you want to check them out the Moroccan Federation of Real Estate Developers (FNPI) is promoting the first Mediterranean & Middle East Real Estate and Investment Exhibition, "Medestate 2008", to be held at the International Exhibition Centre in Casablanca, Morocco, on November 26th-29th. See http: / /www .medestate .ma /index _eng .php for details.

The event is organised under the aegis of the Ministry of Habitat, Urbanism and Territorial Development and in partnership with the Moroccan Chamber of Notaries, the Board of Architects and various international professional organisations and delegations so its not just another cheap marketing event.