Morocco is developing a strategy to become a leading provider of nearshore services for European companies seeking to reduce costs. It aims to attract investment and create jobs in this sector by establishing dedicated business parks with world-class infrastructure, training a skilled multi-lingual workforce, and offering attractive tax incentives. The government agency CDG has been tasked with developing the necessary infrastructure and human capital, including the Casablanca Nearshore Park business zone and Technopolis research hub. Morocco believes its political stability, educated workforce, and proximity to Europe position it well to capture a significant share of the European nearshoring market.

1. INTRODUCTION TO THE VISION AND STATUS
OF NEARSHORING IN MOROCCO
With European businesses bent on reducing their cost base, Morocco is becoming a
leading provider of nearshore services and a preferred destination for the francophone
and Spanish markets. It is betting on nearshore services to spur growth and job
creation. The kingdom has devised a strategy dubbed the “Moroccan offer”, which aims
at sharpening its competitive edge in this sector, providing world class infrastructure and
training as well as offering a set of unique incentives. The group CAISSE DE DEPOT ET
DE GESTION (CDG) has been entrusted with the mission to accompany this strategy
and develop infrastructure and specialist know-how for offshore services.
MOVING OFFSHORE : Offshoring services is a growing trend of relocating entire
business functions to either self-owned or third-party service providers, typically in low-
cost locations.
STRATEGY : A central plank of its “Emergence” programme, Morocco’s ‘Offshoring’
strategy aims at strengthening the kingdom’s attractiveness by establishing an
environment conducive to this activity, with a view to boosting investment and job
creation. The programme forecasts that Offshoring could create some 91 000 direct
jobs and contribute around Dh15bn ($1.7bn) to GDP by 2015.
With long term political stability and a business-friendly government, a good telecoms
and ICT environment, plenty of well trained multi lingual graduates, and both
geographical and cultural proximity to Europe, Morocco is well positioned to secure a
large share of the European nearshoring market. The kingdom has therefore devised an
aggressive action plan based on three pillars: state-of-the-art infrastructure and services,
skilled and widely available human resources and an attractive fiscal and incentive
scheme.
INFRASTRUCTURE : Morocco is creating dedicated zones in four main cities, with
infrastructure up to the best standards of quality and cost as well as tailor-made
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2. services. This “ready for output” office space will come with air-conditioning, eco-
friendly design pre-cabling and Internet connections, as well as world class telecoms
offers leveraging the competition between the local and international operators.
In December 2005, His Majesty King Mohammed VI launched the construction of the
Casablanca Nearshore Park, CASANEARSHORE, the 1st business area dedicated to
offshore services and outsourcing, which is developed and managed by the CDG group.
The offshoring parc is being built on a 53-hectare at the outskirts of Casablanca, and the
Mohammed-V airport. The first phase, which will make 50 000 sq m of office and
services available, was already operational starting from December 2007. Globally, more
than 300 000 sq m will be delivered over the next 4 years. The government hopes that
CASANEARSHORE will ultimately contribute some Dh5bn ($550m) of revenues and
create 26 000 direct jobs, and about as many indirect jobs.
The next step was the launch of Technopolis, also thru the CDG, which will target in
priority offshore ICT services and business processes, due to the presence in the capital
of a number of large and prestigious engineering schools. The objective here is to create
12 000-15 000 jobs in the engineering and R&D space. Technopolis is a platform
dedicated to the creation, incubation and promotion of innovant and high potential
projects. Next in line are Fès Shore and Marrakech Shore.
HUMAN RESOURCES : Morocco boasts a large pool of human resources at a
competitive cost. The kingdom is developing a training strategy to ensure a proportion
is well-suited to offshoring jobs. A complementary and specific training for up to 22 000
recruits will be undertaken by 2009, covering low-level administrative functions,
technicians, engineers and managers. Plans are already underway to boost this by
producing 10 000 by 2010, a key condition to maintain an abundant supply of labour,
and to prevent wage inflation.
Turning ideas into action, His Majesty the King inaugurated in early 2006 a training
centre for offshore services jobs and information technologies, based within the
Casablanca Nearshore Park. The project, to cost Dh47m ($5.2m), has a hosting capacity
of 3000 students.
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3. Morocco will also offer training assistance and subsidies for companies wishing to train
newly hired staff in the offshoring zones.
INCENTIVES : Acknowledging that the development of the sector will require
Morocco to benefit from transfers of competencies and know-how, the authorities have
put in place the required breaks to attracting foreign investment and the right
partnerships, and announced a specific scheme for companies established within
dedicated zones. This encompasses an effective overall 20% income tax rate, in addition
to the corporate tax relieves already included in the investment charter for FDI (0
Corporate tax during first 5 years and 50% break afterwards, VAT exemption for
exports, ~2.5% customs etc), and a subsidy for training purposes to the tune of ~
€5,800 per Moroccan recruit over the first 3 years of hire.
While these incentives were designed for CASANEARSHORE, it seems likely they will
be replicated to other dedicated zones as these come on stream.
BOOSTING ADDED VALUE : With less than 10% of the French-speaking
offshoring business having moved offshore as of 2004, there is little doubt that the
offshoring sector still has a lot of growth potential, and not only for call centres and
BPO. Indeed, Morocco could also develop knowledge process outsourcing (KPO)
activities, which generate far more added value.
Another example of value-added activity is the establishment of design agencies such as
Teuchos in the aeronautics sector, and Matra Engineering in the automotive sector.
OUTLOOK : Morocco has made great strides in developing an attractive
environment for offshore services, and engaged in a long-term strategy aimed at
ensuring the sound development of the sector. It now has to regulate the sector
effectively and to establish the country’s mounting reputation. It will keep looking for
options to further enhance the industry and tie up partnerships with key international
players and anchors names of the offshoring and nearshoring arena.
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4. Targeted ITO & BPO segments
Industry o Financial services
specific o Banking & insurance back-office
processes o Hi-Tech R&D & engineering
o Medical transcriptions
o Human resources administration
Functional o Accounting and finance
processes
o End-customer relationship management
(In/Out)
o
o Colocation, hosting & infogérance
IT related
processes
o Support & help desk
o Applications development & maintenance
Parks Network
Parks in progress Rabat
2007 Casanearshore (~530 000 Sqm) Casablanca
2008 Technopolis (~ 3 millions Sqm)
Fez
Upcomming parks Marrakech
2009 Fès Shore (~ 200 000 Sqm)
2010 Marrakech Shore (~ 400 000
Sqm)
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5. Casablanca Nearshore Park
o Project :
A tertiary sector business park dedicated to software development,
infrastructure management, banking & insurance back office, customer
relationship management companies …
o Geographic positionning : Casablanca
o Surface : ~ 530 000 Sqm
o Offices & services : more than 300 000 Sqm
Total investment : more than 3,4 MAD mrds – Starting date : 2007
Technopolis
o Project :
A platform dedicated to the creation, incubation and promotion of innovant
and high potential projects.
o Geographic positionning : Sala Al Jadida
o Surface : ~ 1 million Sqm
3 millions forward
o Offices and services (1st phase) : ~ 300 000 Sqm
Total investment : 3,3 MAD milliards – Starting date : 2007
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6. Fès Shore
o Project :
Integrated park dedicated to IT services, data
processing and business process activities.
o Geographic positionning : Fez
o Surface : ~ 200 000 Sqm
o Offices & services : more than 130 000 Sqm
Total investment : 1 MAD milliard – Starting date : 2009
MAScIR : Moroccan Association for
Scientific Innovation and Research
MAVRIT : Middle Atlas Valley Research and Innovation Triangle initiated by AUI
INANOTECH project : (Institute of Nanomaterials and Nanotechnology)
Knowledge & Development project : that associate nanomaterials and micromechanics
Creation of MAScIR
Status
A non lucrative association created on March 2007, with a public utility
foundation status by the Government (Industry department, CNRST), Universities
(AUI , USMB (Fez), UMI (Meknès)) and institutions (Académie Hassan II des Sciences et
Techniques, CDG)
Mission
Value and employment driver by integrating research
and development towards market vision in several
fields trough a Technology Development Centre
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