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Morocco: Cultivating new crops

In a bid to spur greater domestic production and hedge against further price volatility, the Moroccan government has implemented a number of initiatives in recent months to strengthen the cultivation, distribution and sale of agricultural commodities.

Given the impact rising commodity prices have had elsewhere in North Africa, Morocco has taken a number of steps to ensure that basic living costs are kept within reach of the most vulnerable segments of the population, including an innovative portal that seeks to provide some transparency on bulk and retail prices.

Asaar, which is Arabic for "prices", is an online database that aims to limit speculation on local food prices. The initiative was implemented by the Ministry of Agriculture and allows public access to the prices for a wide range of products, ranging from fruits to vegetables to cereals and meat. The project covers price points for dozens of outlets, including nine bulk markets, 20 retail markets and 25 souks across the country.

Some 220 people have been tasked with ensuring the research is up-to-date, including 60 inspectors who send in new prices via PDAs directly to the site and provide information on any recent price variations or new products.

The internet portal marks only one of a number of moves in recent months by the government to limit fallout from commodity volatility. In September 2010, for example, the government suspended Customs duties on soft wheat to ensure regular supply after Russia cancelled most of its exports following inclement weather conditions that dramatically curtailed its crop production.

Given the prominent place Morocco's agricultural sector occupies in the country's economy, boosting production has also been a focus for the government. Currently, agricultural cultivation, husbandry, fishing and processing contributes up to 19% of GDP and is a major job creator, employing approximately 42% of the general working population, and as many as 80% of people in rural areas.

However, the limited amount of arable land, which comprises only 13.5% of Moroccan territory, combined with unstable climate conditions, constrains the sector's performance and has led to significant swings in output in past years. The small size of most plots, which average 5 ha or less, and the lack of irrigation also conspire to drag down performance.

As a result, the country has sought to dramatically revitalise the sector with a comprehensive overhaul, spearheaded by the Ministry of Agriculture's Green Morocco Plan (Plan Maroc Vert, PMV). Launched in 2008, the plan is targeting a significant increase in production volumes as well as an improvement in the sector's socioeconomic returns, particularly in terms of poverty reduction, employment and GDP contribution.

The programme consists of two phases and should attract Dh150bn (€13.43bn) in investment and create 1.5m jobs by the time it is completed. In late September, Morocco received Dh565m (€50.6m) in aid from the French Development Agency (Agence Française de Développement, AFD) to support the plan's second phase. The AFD's contribution, which seeks to boost revenue for small producers in marginalised areas, will target development in Tanger-Tétouan, Taza-Al Hoceima-Taounate and Fez-Boulemane over the next four years.

Several initiatives under the aegis of the PMV have already been launched, which encompass a range of efforts to improve efficiency and quality along the entirety of the value chain. Sefrou province, in the Fez-Boulemane region, for example, was granted Dh31.8m (€2.8m) in 2011 to develop projects to improve the quality and production of crops such as apples, olives and cereals.

In Oued Ifrane, the PMV programme is providing training to 75 farmers to improve revenues from local cereal and olive farms, while a separate project in Timhdit, worth some Dh19.5m (€1.75m), aims to develop a 500-ha plum plantation which would provide 261 farming jobs. Another four projects are planned for the Ifrane province in 2012 to produce crops such as cherries, peaches, plums and apples, all which have higher added value and are less vulnerable to climate change than the production of cereals, for example.

More immediate forms of production support have also been unveiled. Aziz Akhannouch, the minister of agriculture, announced in September that some 130m kg of seeds will be made available to farmers to plant next year's crops, following an increase in the amount of funding for subsidy increases to Dh200m (€17.9m), up from Dh170m (€15.2m) in 2010-2011.

© Oxford Business Group 2011