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Improved economic ties between Spain and Morocco: an example to follow

  According to the Belgian historian Henri Pirenne, the cause of the economic slide that took place in Europe following the fall of the Roman Empire is not to be found in the invasions of the Germanic barbarians but rather in the fact that, with the invasion of part of Europe by the Arabs, the Mediterranean Sea was no longer a sea of trade, one of the desirable results of the Pax Romana. Today, trade between the northern and southern shores of the sea remains meagre compared with that of other geographical blocs. Will the Mare Nostrum someday recover the mercantile splendour of those ancient times? This is precisely one of the objectives of the Euro-Mediterranean Association (or Barcelona Process), an attempt to bring about recovery of the Mediterranean area as a pacific area of free trade between Europe and Africa launched in November 1995. Its threefold aim was to establish an area of security, set up a free-trade area and improve social and cultural links between the European Union (EU) and 10 Mediterranean countries: Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Palestine Authority, Syria, Tunisia and Turkey.

  The results of the Barcelona Process have indeed been few and far between for a number of reasons. First of all, because of armed conflicts affecting some areas which generally have grown worse. Secondly, the limited advances by countries on the African side of the Mediterranean in terms of democratic mechanisms, institutional development and the growth of business and production. Thirdly, by no means less important, in recent years the European Union has gone out of its way in giving priority to the integration of the countries of Eastern Europe while partly neglecting the process of Euro-Mediterranean integration.

  All of these factors mean that from an overall point of view the result has brought more dark than light. It is true that all of the states, except Algeria and Syria, have signed their respective free-trade agreements with the EU. Nevertheless, in all cases these agreements have included long transition periods for trade liberalization. In general terms, the reduction and removal of customs barriers for industrial products is broad but a lot more limited on agricultural products. Some liberalization of trade in services and freedom to establish companies is also envisaged. Nevertheless, a glance at the trend in direct investment and trade between Europe (EU-15) and Mediterranean Africa reveals a rather poor result.

  Between, 2001 and 2007 inflows of direct investment into the 10 non-European Mediterranean countries amounted to 187 billion dollars, of which one-third went to Turkey. By comparison, largely as a result of their joining the EU, the 12 new member states were recipients of 281 billion dollars in investment. In the same period, exports of goods of the five Mediterranean African countries to the EU-15 amounted to 406 billion dollars, an improvement over the 161 billion dollars in the period 1989-1995 which, however, pales in comparison with exports of the 12 new EU member states that went from 234 billion dollars to 1.7 trillion (USD). It is not surprising that following its first decade, the Barcelona Process is now subject to profound revision. In any case, in this situation of limited progress, it is worth pointing out the specific relationship of Spain and Morocco in which the indicators of economic and trade integration have moved ahead considerably.

  For Morocco, trade with the EU-15 represents somewhat more than 60% of the total, both in exports and imports. It main trading partners are Spain and France which in 2007 were the destinations of 23.5% and 21.1% respectively of all goods exports from Morocco. On the other hand, Germany, Europe’s biggest economy, represents only 3.4%. In imports, the percentages for Spain, France and Germany were 12.7%, 15.9% and 5.5% respectively. The leading position of Spain in this trade increased between 1995 and 2007, a period when trade between Morocco and Spain grew at much faster rate.

  The improved trade relations between both countries also carries weight in computing overall trade if we look at the five North African Countries and the EU-15. France is the main trading partner in the area but between 1995 and 2007 Morocco’s sales to Spain contributed 20% to the growth of goods exports to the EU-15 from Morocco, Algeria, Tunisia, Libya and Egypt, whereas exports to France represented 15%.

  In the bilateral relationship between Spain and Morocco, the breakdown by economic sectors shows that Spanish imports from Morocco were those undergoing the most significant change. Commodities represented 25% of those imports in 1995 whereas in 2007 that share had been reduced to 5%. In marked contrast, Spain’s imports of capital goods went from 1% to 23% and consumer manufactures rose from 23% to 40%. In terms of Spain’s exports, the profile has held more stable with manufactures and capital goods in the lead, along with the relative replacement of food by goods from the motor vehicle sector. With regard to direct investment from Spain, between 2001 and 2007 Morocco was the destination of 2.25 billion euros, four times more than that received by the other four countries of Mediterranean Africa. The tobacco industry and manufactures of non-metallic minerals made up three-quarters of the total.

  In recent years, Spain and Morocco have overcome many of their old differences and have been developing closer and closer commercial and economic ties although there still exists some considerable margin for improvement. Spain has obtained a supplier of manufactures and capital goods offering good price while the Moroccan kingdom, which has fewer energy resources than its neighbours, has seen its per capita income almost double in terms of purchasing power parity since the mid-Nineties. Is this an example to be followed for the EU as a whole? European Union leaders and those from Mediterranean Africa are to meet in Paris on July 13 in order to give a boost to the Barcelona Process. Let us hope that for once the EU decides to cast its eyes southward and that it will begin to understand the potential offered by that side of the Mediterranean, which geographically is so close yet politically so remote for many European meeting rooms.

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