The Moroccan Economy Sends Mixed Messages

While phosphates and viticulture show positive growth and returns, the tourism sector is still dormant and the real estate market is still languishing.

Phosphates exports spike

In the good news for Morocco, the country's exports of phosphates and spiked 44% in the year up to June, reaching 22.8 billion dirhams compared to 15.8 billion dirhams last year, said Morocco's exchange rate monitoring body, Office des changes.

Foreign sales of phosphates rose 47.3% hitting 5.72 billion dirhams up to the end of June, against 3.88 billion dirhams the same period last year.

Exports of natural and chemical fertilizers hiked 85% to stand at 9.4 billion dirhams, compared to 5.1billion dirhams last year, with a 32.4% rise in volume.

The Office des changes noted that the fertilizers' average export price reached 4,724 dirhams per tonne, against 3,381 dirhams in June 2010.

Following the same rising trend, Phosphoric acid posted a 12.2% increase yielding 7.6 billion dirhams compared to 6.8 billion dirhams last year, despite a decline of 15% in volume.


Viniculture generates almost 200 million dirhams

Viniculture in Morocco spans over an area of 49,000 hectares of vineyards yielding an annual production of 230,000 tonnes of grapes, including 172,000 tonnes of table grapes, Agriculture and Fisheries Minister Aziz Akhennouch said.

The Minister, who was speaking recently during the annual festival of grapes in the commune of Charrat (south of Rabat), said that 71% of the area dedicated to the production of table grapes is in the regions of Doukala, Al Haouz, Benslimane, Rabat-Salé, Khemisset and Essaouira, while the wine grape vineyards are to be found in the regions of El Hajeb, Khemisset, Meknes, Gharb and Melouis.

Akhannouch highlighted the importance of the viticulture in the green Morocco plan to boost agricultural production, noting that vineyards generate no less than 196 million dirhams annually

Morocco's property bubble bursts

  Morocco's property bubble has burst. Starting in 2003, during the period of four years, prices have almost doubled or tripled depending on the city. in the region of Marrakesh, rates are down about 20 percent. Offers  now exceeds demand.

Postcard from Oualidia

SAFI
It's ironic that 'saafi' in Darija means 'enough'. One night in the industrial port of Safi, north of Essaouira, was quite enough. Approaching from the south, we passed the enormous phosphates plant, belching out sulphorous white smoke from its labyrinthine tubes.

Safi does not delight the visitor

Next came the huge sardine works that also don't produce much in the way of pleasant smells. The other big industry in Safi is pottery - much of the ceramics found across Morocco come from this town and the potteries dominate it. There's absolutely nothing for the tourist here apart from the potteries. We were glad to move on.

A hair-raising ride to Oualidia followed. The taxi was older than us, about the same vintage as the elderly driver. But appearances can hide all sorts of things - here was Mad Max himself. In a car that rattled and bucked, where the instrument panel had long given up and there were no seatbelts (not necessary in taxis in Morocco, of course, though we wonder why), this driver got up to knuckle-biting speeds on the poor coastal road between Safi and Oualidia. Thank goodness there's a white line in the middle of the road to guide the driver - for most of the ride this old bucket straddled it, when it wasn't on the wrong side of the road overtaking huge trucks on blind corners.

OUALIDIA
Arriving in Oualidia meant a fight with Mad Max - we wanted to be taken to our hotel, he would go no further than the taxi rank. In the end he couldn't anyway, as the car died there and then. We were secretly quite pleased about that. So we hiked the kilometre or so down to the beach to find our hotel. There are no taxis in Oualidia, and no signposts to hotels, strangely enough.

an aerial view of the lagoon at Oualidia

Oualidia is truly beautiful, set on a peaceful lagoon. The town is split between the usual Moroccan conurbation up on the bluff, and the string of hotels, restaurants and holiday homes along the beach about a kilometre down the cliffside. Around the lagoon there are plenty of sea sports - a surf school run by Morocco's champion surfer, Noureddine Joubir, quads, scooters, windsurfers and kayaks for hire, or you can just laze in a beachside restaurant savouring fresh fish. This week there's a red tide (a form of algae ingested by molluscs making them inedible), so no oysters or mussels. The oysters are farmed in the lagoon - you can visit one of the factories to see how it's done, and then taste them in the restaurants.

The lagoon in Oualidia

See all The View from Fez POSTCARDS HERE.

Phosphorus and Morocco - the future

The geographic concentration of phosphate mines threatens to usher in an era of intense resource competition. Nearly 90 percent of the world's estimated phosphorus reserves are found in five countries: Morocco, China, South Africa, Jordan, and the United States. In comparison, the 12 countries that make up the OPEC cartel control only 75 percent of the world's oil reserves. - Foreign Policy Magazine

Moroccan phosphate mine

While we often read stories of "peak oil" and the problems of a diminishing supply, little is said about phosphorus. Yet this resource is important. A recent edition of Foreign Policy Magazine has this to say: Our dwindling supply of phosphorus, a primary component underlying the growth of global agricultural production, threatens to disrupt food security across the planet during the coming century. This is the gravest natural resource shortage you've never heard of.

So why is phosphorus imortant? Phosphorus is used extensively for a variety of key functions in all living things, including the construction of DNA and cell membranes. As it is relatively rare in the Earth's crust, a lack of phosphorus is often the limiting factor in the growth of plants and algae. In humans, it plays an essential role in bone formation. Without a steady supply of this resource, global agricultural production will face a bottleneck, and humankind's growing population will suffer a serious nutrition shortage.

The world's reliance on phosphorus is an unappreciated aspect of the "Green Revolution," a series of agricultural innovations that made it possible to feed the approximately 4.2 billion-person increase in the global population since 1950. This massive expansion of global agricultural production required a simultaneous increase in the supply of key resources, including water and nitrogen. Without an increase in phosphorus, however, crops would still have lacked the resources necessary to fuel a substantial increase in production, and the Green Revolution would not have gotten off the ground.

By 2008, industrial farmers were applying an annual 17 million metric tons of mined phosphorus on their fields. Demand is expanding at around 3 percent a year -- a rate that is likely to accelerate due to rising prosperity in the developing world (richer people consume more meat) and the burgeoning bioenergy sector, which also requires phosphorus to support crop-based biofuels.

Our supply of mined phosphorus is running out. Many mines used to meet this growing demand are degrading, as they are increasingly forced to access deeper layers and extract a lower quality of phosphate-bearing rock (phosphate is the chemical form in which nearly all phosphorus is found). Some initial analyses from scientists with the Global Phosphorus Research Initiative estimate that there will not be sufficient phosphorus supplies from mining to meet agricultural demand within 30 to 40 years. Although more research is clearly needed, this is not a comforting time scale.

The Global Phosphorus Research Initiative (GPRI) is a collaboration between independent research institutes in Europe, Australia and North America. The main objective of the GPRI is to facilitate quality interdisciplinary research on global phosphorus security for future food production. In addition to research, the GPRI also facilitates networking, dialogue and awareness raising among policy makers, industry, scientists and the community on the implications of global phosphorus scarcity and possible solutions.

We have pointed out that the phosphorus situation has many similarities with oil, yet unlike oil, there is no substitute for phosphorus in food production. Phosphorus cannot be manufactured, though fortunately it can be recovered and reused over and over again. But peak phosphorus is also linked to peak oil. For example, the recent oil price shock and growing concern about climate change has stimulated a dramatic increase in biofuel crop production globally, which in turn increases the demand for phosphate fertilizers, and hence the proximity of the phosphorus peak.

Already, signs are emerging that our current practices cannot continue for long. Between 2003 and 2008, phosphate fertilizer prices rose approximately 350 percent. In 2008, rising food prices sparked riots in more than 40 countries. Although the spike in fertilizer prices was only partially responsible for the higher food prices, the riots illustrate the social upheaval caused by disruptions to the world's food supply. The 2008 food riots were only stopped by government promises of food subsidies -- a viable strategy only as long as governments can afford the ever-increasing costs of food support. - Foreign Policy Magazine.

 

Morocco is an important player in these scenarios. Many of Morocco's phosphate mines are in Western Sahara, where problems with the Algerian backed Polisario Front are ongoing. Reflecting these concerns, U.N.-sanctioned export restrictions on phosphate and other resources are now in place, though the efficacy of the bans is incomplete. China, the country with the largest phosphorus reserves after Morocco, imposed a 135 percent tariff on the resource as part of 2008's complex series of events in which rising fuel and fertilizer costs led to rapid increases in food prices. The tariff effectively eliminated exports. Although the tariff was subsequently lifted as the 2008 food crisis faded, the imposition of this sort of trade barrier could become a regular occurrence as supplies dwindle worldwide.

The USA now imports 10% of its phosphorus from Morocco. The most productive mine in the USA is in Florida but according to Foreign Policy Magazine, it is expected to be depleted within 20 years. The future is uncertain, but Morocco will play a key role.

The article in Foreign Policy is worth reading. Check it here