UK Export Finance (UKEF) has unveiled £4bn of support for UK exports to Morocco, as it seeks to galvanise new opportunities for British businesses to capitalise on the North African country’s infrastructure boom.
The export credit agency, which has appointed a new International Export Finance Executive in the country’s largest city of Casablanca, is making the financing available to overseas buyers of UK goods and services to deliver projects, provided that at least 20% of the overall contract value is sourced from UK suppliers.
This development comes amid a flurry of infrastructure investment into Morocco as it seeks to position itself as the largest and most important regional player in North Africa-Europe-Asia supply chains, with sustainable energy projects as well as modern infrastructure development, such as roads, ports, airports, and rail links, becoming a top government priority.
The Moroccan ministry of equipment, transport, logistics, and water aims to build an additional 2,100 miles of expressways and 1,300 miles of highway by 2030, at an expected cost of US$9.6bn. In addition, the government’s 2040 rail strategy will require US$37bn to fund projects that include extension projects of the country’s high-speed rail network and upgrades to its light rail infrastructure – such as the €15mn contract recently awarded to UK-based Colas Rail to install low-voltage systems on Casablanca’s tram network.
Meanwhile, Morocco’s 2030 port strategy calls for nearly US$7.5bn to upgrade and expand the 27 ports along the country’s Atlantic and Mediterranean coasts, building expansions and upgrades to provide new access to African trade. This is an opportunity the UK has sought to take advantage of with the inauguration of a new maritime connection between Tangier Med and the British city of Poole, which allows for the transport of goods between the two countries in less than three days, with the additional benefit of avoiding Brexit-related road transport costs and delays.
“I’m proud that UKEF is playing a leading role in strengthening the historic trade relationship between the UK and Morocco, with on-the-ground presence and support from our international finance team,” says Samir Parkash, UKEF’s interim chief executive officer. “UK firms have an opportunity to do more business with Morocco and we look forward to supporting projects in the region.”
Another increasingly attractive sector for British suppliers to Morocco is clean energy. A long-time importer of the vast majority of its energy needs, the country is now targeting 80% renewable power by 2050, and is rolling out numerous megaprojects to put the Atlantic trade winds that barrel across its coastline – and the over 3,000 hours of sunlight it receives per year – to good use.
This hasn’t gone unnoticed by Europe, which is ramping up its energy diplomacy to reduce its dependence on Russian hydrocarbons. During the Cop27 climate summit earlier this month, Morocco signed a memorandum of understanding with France, Germany, Portugal and Spain to promote the integration of their green electricity markets, allowing for the signing of cross-border power purchases. This follows the announcement of the Xlinks Morocco-UK Power Project, which will see a solar-plus-wind site in the Moroccan desert supply 3.6GW of clean power to the UK for an average of 20 hours a day, enabled by four 3,800km long subsea cables.
“It’s great news that UKEF now has a dedicated resource here in Morocco,” says Simon Martin, the British ambassador to Morocco. “The challenge is now on buyers in Morocco to bring their projects forward. With the support of UKEF we could see a new wave of investment in Moroccan infrastructure, renewables and other sectors. I am excited to see how this develops and looking forward to seeing our partnership with Morocco continue to grow.”