Increasingly close to each other, Morocco and Switzerland have shown in recent years an unprecedented rapprochement and an undeniable affinity in their foreign policy. This year, the two countries celebrated the centenary of the Swiss diplomatic presence in Morocco, which was marked by a series of meetings and conferences at the highest level.
On the occasion of the centenary, Switzerland, through its ambassador in Rabat, Guillaume Scheurer, expressed its desire to deepen its partnership with Morocco by focusing on two elements: Trade and Innovation. The potential is promising and there is plenty of scope to fulfil these ambitions. The Kingdom is Switzerland’s third largest trading partner on the African continent. A status that is appreciated by the Swiss federal government, which wants to push trade to a higher level than it is today. There is no need to break down customs barriers any further than they are today, as the two countries are linked by a multilateral free trade agreement.
Signed in 1997 and entered into force two years later, this agreement brings together Morocco and the European Free Trade Association, which includes Switzerland, Iceland, Liechtenstein and Norway. Twenty-three years after its entry into force, the agreement needs to be evaluated to see how beneficial it has been in promoting trade between Rabat and Bern.
We have received data from the Swiss Embassy, the Swiss Chamber of Commerce in Morocco and the Administration des Douanes et des Impôts Indirects that allow us to take stock of bilateral trade. To date, the volume of trade within the EFTA-Morocco framework has reached almost 700 million euros, with 355 million imports and 365 million exports. From 2002 to 2021, trade has grown at an annual rate of 7.4% for imports and 6.3% for exports. Pharmaceuticals and tobacco are the top export products.
Trade is growing but not as much as expected
This progressive trend is also noticeable in trade between Morocco and Switzerland. Trade between the two countries has evolved over the past five years. Moroccan exports have progressed by 68% in 2021 compared to the previous year with a value of 2540.9 MDH. However, this evolution was of lesser magnitude in the previous years since it reached only 3% in 2020, 15% in 2019 after having fallen by 20% the previous year.
On the other hand, imports from Switzerland have developed at a lower rate than exports. From 2016 to 2021, the figure of imports increased by only 271.8 MDH knowing that it decreased from 2018 to 2021 from 3161.5 to 2845.7 MDH. In 2021, imports increased by 8%.
At this time, the bilateral trade benefits for Switzerland whose balance is in surplus at a rate of 21%. In 2021, Switzerland had a surplus of 304.8 million dirhams, a much lower figure than in 2020 when the surplus was 1129.8 million dirhams. This decrease is due to the increase in the coverage rate from 57% to 89% from 2020 to 2021. Basically, Morocco has been able to rebalance the terms of trade over the last five years by reducing its trade deficit from 1208.8 to 304.8 MDH.
Tobacco and medicines at the head of Moroccan imports
At the level of products, Morocco mainly imports from the Swiss market tobacco (661 MDH) and medicines and other pharmaceutical products (560.7 MDH), i.e. 56.68% of total imports. On the other hand, Moroccan exports are dominated by electronic components (669.1 MDH), semi-finished silver products (608.4 MDH) and passenger cars (309.5 MDH).
Despite the efforts of both parties to move forward, the current state of trade remains below the real potential. It must be noted that the share of Switzerland in Morocco’s foreign trade does not exceed 1%, according to the figures we were given. This is why both countries are looking for a way to promote business and trade through the exchange of delegations of businessmen and heads of chambers of commerce.
According to Ambassador Guillaume Scheurer, Switzerland aspires to share its know-how in innovation with Morocco in the framework of a mutually beneficial partnership. Switzerland sees the Kingdom as one of the gateways to Africa and this is why it intends to develop commercial cooperation.
Morocco has great potential as a signatory to six free trade agreements, including those with the EU, the United States, Arab countries and Turkey. This allows Swiss companies based in Morocco, of which there are about fifty, to have access to a market of nearly one billion consumers through the customs advantages granted by these agreements. If one were to draw a conclusion from this reality, one would say that the Kingdom presents itself as a hub for the EFTA countries, including Switzerland.
Modernisation of customs procedures
Also, there is enormous potential in the EFTA-Morocco agreement that remains unexplored. The authorities of both countries have made efforts to enable economic operators to better benefit from these advantages.
Among the measures taken, the reduction of deadlines, the digitalisation of procedures relating to certificates of origin and the relaxation of specific rules applicable to certain products. In an effort to reduce bureaucracy, the customs administrations of both countries have strengthened their coordination.
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