Essentials of Borrowing
Morocco – Investment Potential is Sky Rocketing
For those of us who are a little tired of today’s mass development on the Costa del Sol, Morocco, only just across the water, could prove to be the perfect solution. Offering respite from overcrowded roads and busy summer periods in Southern Spain, Morocco is currently supplying a demand for fresh investments within a fast growing market. Conservative estimates of 15% growth per annum for the next 5 years and double digit yields are really possible. Location and Access Morocco is just 3 hours flight time from the UK. Situated in North Africa and literally only a stone’s throw away (actually, 10 km!) from Spain’s southernmost tip, at Tarifa, Morocco is easily accessed from Spain. Catch a car ferry or high speed catamaran from the ports of Algeciras or Tarifa, and within 35 minutes you will find yourself at Tangier, the gateway to you’re an exciting new world.
Changes to the Infrastructure • A huge port is being built between Tangier and Tetouan and this will be called the Golden Mediterranean, taking heavy freight away from Tangier port and making Tangier into a desirable tourist destination. • Roads will be improved and a new motorway between Tangier and Tetouan is being built, • Tetouan airport will be upgraded and a new airport built in Tangier. • The “Open Skies Agreement” has attracted many of the major airlines (Monarch, Ryan Air and Easy Jet) to Tangier and Tetouan airports. • Great offers are being offered shortly by Gibraltar Airways, Thompson and Atlas Blue to Tangier. • Royal Air Maroc will increase its fleet by 50% in 2007.
• An excellent new train station has been built by the French in Tangier • Planned rail tunnel under the Straits of Gibraltar to link Spain to Morocco in 2008 The new port is earmarked as the main hub into Africa, with good road links being built around it. The Americans have been given the contract to manage this port for the next five years, bringing American workers into the area. Greatly increased flights will attract a growing number of visitors: Gibraltar Airways (GB), part of BA, have just announced that it will fly to Tangier shortly for 169 pounds return. Thompson have also promised flights to Agadir for only 29 pounds each way. Atlas Blue currently flies to Morocco for 60 pounds return. These deals will accelerate in 2006, while Morocco is still an untested market for the budget airlines. These new deals will undoubtedly put pressure on the flag carrier. Tetouan, about 1 hours drive west of Tangier, has an international airport that is little used. The large hotel groups, Club Med, Sofitel, Accor in the area have been lobbying the Governor to open it up more regularly, as it is currently used for internal flights only. Car hire at the moment in Morocco is expensive but this should change when the bucket airline business to Morocco gets established.
Constitution and History As if the vastly improved communications to the country are not enough, Morocco continues to manifest its forward-thinking policies for economic growth and international recognition through the new King Mohammed VI, who came to power in July 1999. Mohammed VI is a reformist and a moderniser. He has set about bettering links with the Western World and improving its human rights issues, as well as laws on corruption and religious extremism, whist introducing more equality to women. Consequently Morocco is fast becoming the most “Western” of all Muslim countries. With a huge investment of 5bn dollars, another key reform has been the Plan Azur, which has improved tourism and greatly increased employment figures. In a brief outline, the Plan Azur increased tourism to 2.5m in 2001 and estimates over 10m in 2010. In 2004 figures reached around 5. After 6 years of power, Morocco has gained credibility as a suitable investment prospect.
It has low inflation (1.9% in 2005) and a stable currency, the Dirham. The currency is not fully exchangeable outside Morocco but is worth around 16 to the £ and at 11 to the Euro it moves very much in line with the Euro. At only 42 years of age, the King was once an international standard golfer. He was educated in Europe and spent time in America and France. He studied law and wrote a number of prominent articles regarding the North Africa MAGREB, Morocco, Algeria and Tunisia. In the past century, the power in Morocco changed hands a number of times, being divided between Spain, France and Britain. Along with centuries of Moorish and Berber culture, Morocco today has a very interesting mix of old and new. Morocco maintains strong ties with Spain that retains a number of enclaves, much like British Gibraltar, at Ceuta, Melilla, Peñon de Velez de la Gomera and Peñon de Alhucemas. Links are also close with France with Morocco, being the third most popular holiday destination for the French.
The legal system, along with the education system, is modelled around the French system. Morocco has good relations and strong links with the UK and America who receive much of its textiles and manufacturing goods. M & S receive around 30% cent of its knitwear from Morocco. Investing in Property There are no laws or complications that would stop foreigners investing in property or land and the legal system is based on the French system with notaries doing much of the administration, particularly in matters of land and property purchase. Legal fees would set you back around 5 %, much less than the 10 to 15% in France and Spain. The major property areas offering the widest choice of property are located around Tangier on the northwest tip, Casablanca on the Atlantic coast and inland at the very cosmopolitan Marrakesh. Inland and the Atlantic coast have fairly established tourist resorts and therefore property prices tend to be higher than in lesser known areas. New developments are going up along the Atlantic coast, offering value for money. Riads (old traditional houses set around a courtyard) are to be found in most cities and still represent realistic prices, whilst some may need some tender, loving care or major renovation.
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