Globus Vision meets with Moroccan Minister of Tourism Lahcen Haddad, who emphasises that Morocco’s tourism sector, though strong among other markets, must “double up efforts with respect to Germany”
In the midst of a global economic crisis and political turbulence in the North African Region, Morocco has proven to be an alternative for economic growth and political stability. Growth rate has averaged 4.5% in the last three years, international trade increased by 20% in 2011, direct foreign investment has doubled, and political stability was maintained whilst social progress inevitably continues.
Honourable Minister, what is your point of view on this economic growth and investment opportunities in recent years?
I would first of all like to highlight that Morocco has been able to implement reform policies over the past twelve years. We have made great efforts both politically and economically. Political reforms have focused on human rights, economic rights, and women rights, including linguistic and political openness into the system so that the Islamists can be absorbed into the political arena. All of these reforms have been pertinent for our society striving to become much more pluralistic in political diversity.
There was also initiation of economic reforms such as the liberalisation of the economy. The wave of privatisation policies adopted in the 90s has greatly transformed many public and private sectors. Telecommunications sector and others have become more competitive. The business environment was also reorganised through tax reforms. A different investment code was introduced after signing the FTAs with the USA and Europe. All of these factors have significantly contributed to Morocco’s progress as compared to other countries in the North African Region, in Africa at large and in the Middle East.
The economic crisis did not really affect Morocco directly to a greater extent when it started unlike other countries of the region. Let’s underscore here that Morocco embarked on some protective measures against the crisis. Our banking system is not convertible at 100% and it strictly abides by the prudential policies of Basel 1, 2 and 3, hence it could not collapse despite the crisis. But what is important to point out is that these reforms have ensured a stable macro-economic framework that makes us to control our budget deficit figured at less than 2.3%. We have curbed inflation to below 2% and started a sound public debt reform. We have reduced public debt by converting a greater portion into investment and also reduced the ratio of external debt to GDP, which means we have curbed public debt for the first time ever to a level below 50% of the GDP. Another significant point to mention is that Morocco has indeed adapted very good macroeconomic policies in all domains that serve as catalysts in its public-private relations and as examples for others. All these factors helped us to avoid the arrival of the Arab Spring, the international monetary crisis and the crisis affecting our European partners.
Seventy percent of our exchange is done with Europe and of course Morocco definitely suffered the consequences of the political crises that shook the Region. The Morocco economy proved resilient in the face of these sensitive and volatile factors. According to historical facts, when Morocco gained its independence, it focused its attention on agriculture despite the unfavourable climatic conditions; this implies that before 2000, part of the economy and ecosystem was strongly dependent on rainfall.
Whenever it rained in abundance, the effect could be felt in economic growth but whenever it was not the case, we could feel the shrink in economic growth. But nowadays, rain or not, the economy is resilient through other sectors other than agriculture. We have been able to develop other sectors like Telecommunications, Industry, commerce, Tourism and Mines to help sustain a greater portion of our GDP. This means there have been substantial developments leading to the creation of many jobs with greater values to withstand any adverse situation from the agriculture sector. We have also been able to transform a part of the agriculture sector. We have adopted the policy that agriculture does not only depend on rainfall and so we have decided to make maximum use of irrigation methods by carrying out some extra investments in the agriculture sector. We have done everything possible to diversify the economy and reduce our dependence on rainfall. This strategy has proved worthy and made us to resist the crisis thereby becoming a platform for many European and American companies as well as for other markets in Africa and the region.
Honourable Minister, after a year of high growth in the sector in 2010, the number of incoming tourists has increased by 1%, revenue increased by 4%, and the number of nights down by 6%. In view of the above statistics, you said during the ONMT conference held on February 21 that giving the context of global crisis, the results were satisfactory.’
Sir, could you tell us the mechanisms put in place to maintain this growth rate in the tourism sector? What would be your priorities henceforth?
We have instituted many mechanisms at different levels. The first level is promotion. We believe that Morocco’s customary markets namely France, Italy, Spain, UK, Germany and the Benelux countries are important. We believe the highest number of European tourists come from these countries. We must therefore learn to reinvest in order to maintain the status quo.
There is an important tourist movement coming from those markets, mainly English and German who keep travelling. On the other hand, apparently the French tourist movement is slowing down due to a year of elections, but there is the possibility to increase in the future. Regarding the Spanish market, it is the one presenting more difficulties because it has been very affected by the crisis.
Coming back to the German market, I am convinced that we could do better because this country provides a significant number of tourists (70,000) with high purchasing power. This country stands out as well for its proximity to Morocco. We need then to double up our efforts with respect to Germany.
The second important thing is to invest in new markets. There are emerging markets that are very important. The World Tourism Organisation forecasts have shown that we will reach the one billion bench mark this year and 1 billion 600 million by 2020. I believe that the majority of the 600 million additional tourists will not come from Europe but from emerging countries like; China, India, Brazil, Russia and Eastern Europe. The latter region constitutes a very important emerging market and so we have made our presence to be strongly felt there.
We also have a representation office in Moscow, in Stockholm and we will also have another in Poland that has embarked on an aggressive publicity campaign in Bratislava and beyond, with the sole objective of taking over the aviation sector in Eastern Europe.
With respect to our accomplishment in Morocco, there is a will to consolidate domestic demand. I believe Moroccan tourists represent approximately 26% of our entire tourist population. This trend should improve. We are currently working on some new suitable and appropriate modalities for Moroccan tourism.
The safer destinations are those focusing more on domestic tourism before international tourism. In Spain for example, you have 40% of the Spaniards travelling in their country. It is therefore important for us to set a really good basis for domestic tourism based on better offer of tourist resorts and easy access. In respect to what we can offer, the Moroccan tourism industry wishes to realise three objectives: family trips, cultural activities in tourist resorts, and affordable prices.
It is for this reason we are currently trying to develop tourist resorts called locally Biladi meaning ‘my country’ in Arabic. We will develop at least ten of them by 2020. We will also develop more environmental friendly clubs in the mountains.
We are also contemplating on what could be done in the hotel industry to benefit Moroccans. This constitutes the second action we are undertaking.
The third action consists in analysing our tourist indicators and mainly the correlation between the revenues having increased by a 4% and the overnight stays which show a decreasing trend.
Moroccan tourism is a luxurious five-star tourism industry. This class did not suffer the crisis because it relies largely on well known international hotel chains namely Sofitel, ABC suites, Four Seasons, Carlton, which have distribution networks and customer loyalty throughout the world. The national occupancy rate of other hotels is usually at 45% while for Five-star hotel, it is estimated between 60 to 73%. This also explains the added value to this sector.
So what are we currently doing? We are working with four-star hotels and those that are not associated with any big names to help them be organised and put in place better management principles or confide them to good managers or help solve their cash flow problems through loans. The question of quality and other inherent problems are apparent. We are in consultation with them to find common solutions.
The airline industry it is an important element to do publicity campaign. This sector is very complex giving the problems airlines are faced with nowadays. For an international organisation like IATA, the aviation sector will be the priority for this year 2012. The forecasts are about 1%, which means there will not be more flights this year as compared to last year. In the first place, airlines were also affected by the crisis. Secondly, the price of a barrel of oil does not help at all; the price per barrel was almost at $125.
If oil prices do not fall below $100, it would be difficult for airlines to open new routes and invest in a growth strategy. In the tourism sector, we do not wish to stay inactive, that’s why we are working on Moroccan airports but Casablanca in good incentives by making airlines to pay less tax.
Casablanca is a centre where costs cannot be reduced. Agadir for example is subject to a pilot study to that effect. We are also studying marketing contracts with airlines to lower costs, etc., to see how flight routes could open mainly between Munich to Essaouira, Munich to Agadir, and Stuttgart... This aspect is very important but we are also in contact with tour operators to develop packages that also include the aviation sector and charters. We could cite the case of Air Arabia, etc. It is then a fairly complex equation but is very important to us.
The other measure made known by your contribution (journalists) and for which I salute here is to speak of the exceptional nature of Morocco as compared to other countries in the region, mentioning the changes the country undergone through a peaceful and silent revolution like the English Revolution of 1680 called "The Great Revolution." We succeeded this revolution without street protests or violence, a democracy going on which makes room for power-sharing between the King and the Government, a separation of power between the legislative, executive and judiciary branches of government. There is willingness by Morocco to respect human rights, freedom in all its forms and the acceptance of linguistic and ethnic diversities. We obtained all of these without violent revolution or civil war, proving the uniqueness of Morocco’s capability of anticipating these events in the region. The implementation of reform programmes has been rewarding.
The advantage of our country must be communicated to our friends, our partners, to tourists who have come to Morocco. In so doing, we will be sending a message to the pessimists who think that the Arab world is aflame, and that it is risky to venture in any of them. I would like to tell them that it is not the case for Morocco and encourage them to come because it is a country on the move, it is a country of consensus where everyone is hand-in-hand to make a consensual revolution rather than revolution of division.
Sir, to be honest with you, I would like to confess that what you are saying is very interesting. However, the strategy of Vision 2020 is focused on a quality regional tourism and sustainable development. And the goal is actually to create six new tourists resorts in addition to Aghadir and Marrakech in order to double the number of tourists visiting Morocco and to open up more than 200,000 sources of income in the country. You started explaining the beach programme for instance.
Could you explain in detail the other strands of this 2020 strategy?
Of course! Vision 2020, as the name clearly indicates, is a vision, an ambition, a dream that is realistic and which can be realised within 10 years. What do we expect from this dream? We aim primarily to make Morocco one of the well known and cherished tourist destinations among the twenty best destinations in the world. Secondly, our wish is to make Morocco a referenced tourist destination in terms of sustainable development in the Mediterranean region. We have projected 200,000 extra beds with an investment cost of about 150,000 billion dirham (approximately 14 billion Euros). We also need to double the number of tourists to reach 20 million and triple the number of local population visiting our hotels. Income from tourism spans around 5 billion Euros. We expect to improve it to 10 billion Euros by 2020. This is our vision.
How do we get there? We have seen the need to diversify our offer and so we are currently working towards that. We have beaches, a Medina cultural town, and importantly Marrakech and Agadir which should be privileged. Marrakech is a cultural site and Agadir, a seaside resort. The Germans like the Scandinavians have visited Agadir since the 60s. The French and Spanish tourists can be found everywhere in Morocco. Like the Italians, they love Marrakech.
We intend to greatly diversify our offer and so we need to create tourist attractions embedding our own cultural identity. That is why Morocco will develop 8 major tourist sites and each of these eight sites serves a purpose with its own identity, administrative procedure and characteristics.
We have earmarked landscapes like the territory along the Algerian border to the Atlas which we named “Atlas and Valleys”. We are referring here to the great valleys of Draa. Regions in and around the Atlas are suitable for sustainable development. The beautiful landscape comprises mountains, caves, great valleys, heritage sites namely the Valley of Palms, the great Kasbas used in the 18th century as the starting point of the invasion of the Southern territory by the tribe of Ait Atta. This territory abounds in nature, ecological potential and cultural homogeneity. We could create two or three resorts in that part of the country but we have decided to undertake three or four structural projects there to give it a facelift.
It would therefore be easy for a German, a Norwegian, an Italian, or an Englishman or woman visiting our country from Manchester to land in Ouarzazat and be able to visit the southern valleys, all the Berber countryside where Jews and Africans live in peace and harmony. This is also true for other sites like Marrakech, Essaouira and Safi. Also, the northern region bordering Tangiers and Tetouan and every town or village within that region has its own cultural identity and tourist resort, be it for business purposes as in the cases of Rabat, Casablanca and El Jadida or for recreation. Rabat is better known for its cultural identity with numerous museums and Casablanca for business.
But this challenge requires a lot of money, time and publicity campaign. We must also identify original priority projects with added value and which could be implemented without negative impact on the environment. We have identified about 300 to 400 projects we are working on now. Some of these projects are very interesting; for example the building of a resort town in eastern Morocco on a 600-hectare of land on which eight hotels will be constructed, and a village in Marina and Medina. We also intend to build a whole city in addition to ecological sites, museums, and houses. In the hinterland, there will be tourist attractions, restaurants, gas stations with small clubs here and there. These big and small projects will be highly rewarding. We have, within the frame of the private-public partnership, therefore embarked on developing the townships and regions.
Some projects like hotel and real estate with substantial return on investment can only be run by the private sector while other actions can only be run by the central or local governments. Museums do not generate enough profit unless they are in partnership with a convention center or a construction company in addition to its traditional roles of tourism and hotel resort. We are working on that aspect. But if we have to proceed in this manner, two or three changes have to be made.
The first thing will be defining and implementing new management principles in the sector. You know that tourism is a multi-faceted transversal activity needing collaboration with other Ministries such as the Minister of Infrastructure, Interior, Culture, and Transport. In the context of the Vision 2020 we plan to create tourist development agencies at the level of the 8 tourist territories facilitating the collaboration with the different players having the necessary authority and prerogatives to that effect. Locally, they will be able to develop, regulate, control, and carry our publicity campaign. A reform in management will enable these agencies to manage the production, promotion, mobilisation of partners in all tourist related campaigns within the country.
At a national level, we will set up a High Tourism Authority that shall be answerable to the Prime Minister and which shall bring together all the ministries (i.e. Ministries of Tourism, Interior, Transportation, Culture, Crafts, etc.) that intervene in the industry in one way or the other. They will set objectives, decide and proceed with the arbitration of texts. So this is a new management system that will be put in place to achieve the 2020 Vision.
Secondly, we wish to overhaul our entire training system in the tourism sector. The training schemes adapted met the educational needs of a good number of people but have not proven efficient. If we want to develop 8 tourist regions to ensure a healthy economic activity with consistency in our products, structuring projects, to attract many tourists, we also need qualified human resources in Thalasso infrastructure, sustainable development officers, sports instructors, museum professionals. To accomplish this, we need to remodel our educational system. We have currently 14 schools of higher learning among which are a higher institute of tourism. Our objective is to create an institution of excellence by region which will have for vocation to serve the region by developing the human resources. This will bring about a partnership between the public and private sector because most of the activities in the region will be developed and managed by small and big businesses in the private sector.
We will therefore closely work with private and public institutions of excellence in each region, and we will ensure the training of great managers in the tourism sector and also a great school of tourism management in Marrakech in coordination and partnership with the Lausanne school. These are the two major directions we are taking.
The third direction is monitoring the promotion of the aviation sector, support to small businesses. All these points are important and will be applied to each region. Each region has to promote its identity etc.. We will decentralise many activities for example when we begin to promote in Berlin for instance. We have representatives from each region to exhibit.
The last and most important aspect which should be the culminating point of everything we have said above is sustainable development. There are three or four important points encompassing sustainable development.
- Friendly environment for investment, the preservation of environmental resources is very important. Our stations are different from the tall buildings that you find in Costa del Sol, they are not built along the sea. The respect of the fauna and flora in the environment and the recycling of wastewater for golf courses provided for by law and QUOS should be our priority. QUOS is the land occupation ratio set at less than 10%. All of these features are very important for sustainable development.
- Identification of sites not suitable for mega structure construction. For example, the City of Dakhla located in the far south of Morocco must not accommodate big stations with thousands of tourists. This project must be clearly defined and well channeled with sporting and other activities. We will progressively improve conditions in these areas as we identify them.
- Another important factor is the impact on the population. Such development will surely have a direct impact on the local population. These projects could create jobs for young people. They can also help ignite the dynamics of small businesses. SMEs are throwing their weight around these projects. The population should also take advantage of them by creating micro projects in the mountains, on the other sites or in homes to receive tourists. For us, a development must have an impact on the population to be considered sustainable.
In this context, what are the key measures you have taken? Do we find German tourists in Morocco?
First of all, the strength of the German tourists is based on the fact that the operators intervening in the market are well organised. For example TUI Germany and Thomas Cook are very well organised. We will satisfy the needs of the German tourists, who actually represent 20 to 30% of our tourist population, by providing a special package that will allow them to enjoy the sun, the animation. Like our competitors namely Egypt, Turkey and the Canary Islands, we have turned our attention to these Germans.
It is no longer the case with Egypt.
It is no longer the case actually. You know, the Germans use internet a lot. They are in fact nicked named ‘shoppers’. They surf the web to discover tourist sites. They like ancient buildings for their authenticity. They also prefer individual services.
We are developing a platform in Morocco where reservations will be made in German for the Germans to eradicate significant cultural differences due to the change of scenery into Morocco. We have also embarked on publicity campaign with the general public. In Germany, we must organise fairs in Rambul and Frankfurt. We already have a stand at ITB in Berlin for which I am convinced is the best. I visited it personally – it was beautiful. The Germans are showing enthusiasm for the upcoming three-day fair, mostly because we will have a small restaurant where visitors will be able to go and taste delicious Moroccan dishes and sandwiches. I think the Germans will love that.
An important communication campaign is being carried out through the media or televisions to make Germans to develop interests in Morocco. It is important to tell the Germans that Morocco has diversities to offer. Secondly and in parallel to our human resources, many Moroccans speak German and English. The third point is that Germany is not very far from Morocco. It takes three or four hours to get in either country. The fourth point is that Morocco is a stable country. It has total security and political stability. Morocco and Germany however have strong long-standing tides dating back from the eighteenth and nineteenth centuries when different powerful empires embarked on annexing or colonising it. You know that Morocco was later colonised as France, England, Spain, and others lusted after it. The only country that was in favour of the independence of Morocco was Germany, hence the strong links.
After independence, the relationship grew even stronger. Morocco also has strong relationship with German universities like Stieftang, Conrad, Handsidel, Friederich Herbert and so on. And so there are good relations between German and Moroccan elites. I even published a book when I was in college through the Conrad Foundation. The Germans also rendered technical assistance to us through the German Cooperation GIZ in the sectors of water, environment, education and sustainable development.
Germany is perceived much more favourably in Morocco. Therefore, there is no reason our friends will not come to visit Morocco considering the fact that they look for sunny destinations. In fact, when the temperature reaches -10 degrees in Germany, the German tourist will find in the south of Morocco mild temperatures of 20º or 25º. We are currently building two stations in the north of Agadir and two mega resorts in the South with constant sunshine throughout the year.
No, it is at the north of Agadir. The weather is beautiful out there for about ten to 11 months in the year but at Chbika and Plage Blanche, the weather is beautiful all year long.
But they are part of the Azure projects?
Yes, they form part of it.
Sir, you were recently named minister, precisely in January and lots of expectations are placed on the development of the tourism sector.
So what is your challenge Mr. Minister at the end of your political project? What future outcome would make you proud?
The challenge for me is to first put the Moroccan tourism industry on track so that it can attract many tourists and return to growth by the end of my term. The second thing is to attract the maximum investment to start the Vision 2020 project because we need to invest about 14 billion euro by 2020. The third thing is to set up a managerial body for the sectors. All these factors combined will enhance tourism growth. I could retire before the next generation. I can retire, I can go and enjoy something in someone’s island where it’s nice.
10 Fintech 101
When being part of a generation on which the flag of entrepreneurship seems to be constantly waving in the sea of young professionals looking to succeed in the business world, more often than not, we tend to drown in the... Read More