Morocco Develops Automobile Industry Despite Global Trade Slowdown

Employees work at the assembly line of Dacia Sandero cars at a factory operated by Somaca in Tangiers (file photo: Reuters)
Employees work at the assembly line of Dacia Sandero cars at a factory operated by Somaca in Tangiers (file photo: Reuters)
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Morocco Develops Automobile Industry Despite Global Trade Slowdown

Employees work at the assembly line of Dacia Sandero cars at a factory operated by Somaca in Tangiers (file photo: Reuters)
Employees work at the assembly line of Dacia Sandero cars at a factory operated by Somaca in Tangiers (file photo: Reuters)

Morocco’s recent involvement in global value chains for automobiles is an example of a country’s ability to expand its own trade despite global trade slowdown, according to the Arab Sustainable Development report.

The report, issued by the United Nations bodies operating in the region, headed by the Economic and Social Commission for Western Asia (ESCWA), said that Morocco sought to diversify its sources of growth through the development of the automotive industry by launching its Renault-Nissan Tangier plant in 2012.

The report noted that the automobile manufacturing saw a 20 percent annual growth in Morocco, and became a major driver for the country’s exports, adding that it is supposed to help launch the Peugeot-Citroen plant in Kenitra, further consolidating its position.

It also indicates the untapped potential for Arab countries to participate in the international economy.

The report noted that “improved investment is a policy choice” calling upon Arab countries to support innovation and entrepreneurship, absorb the potential and capacities of youth, create a conducive environment for the development of new industries, and integrate countries further into global value chains.

“Make greater efforts to forge agreements between countries to foster full regional integration and increased access to global value chains.”

In the field of adopting modern technology as a mechanism for implementation in the Arab region, the report sees that Morocco, along with a few other countries, has adopted noteworthy initiatives. It pointed out that educational systems, political structures, and social norms in most countries do not focus on critical thinking and creativity, which prevented the emergence of a critical mass of people effectively using, innovating, and producing technology.

The weak absorptive capacity in many countries has resulted in the widespread consumerist approach where people use technologies and products, without producing or adapting them according to their local needs.

Morocco is one of the few Arab countries that have adopted guaranteeing access to information as a fundamental right, according to the report.

Also, the document highlighted that some countries have made great strides in reducing maternal mortality, including Morocco, especially in rural areas.

It called for greater equality in health care provided especially maternal health care and during childbirth, however, it criticized the absence of social protection systems that mitigate marginalization and exclusion in the region.

The report warned that in the Arab region, the poor, refugees, and displaced people are at the risk of being left behind when it comes to social development goals. It cautioned that the impact of the situation is borne disproportionately by groups that face multiple layers of social, economic, or political marginalization including women, persons with disabilities, migrant workers, refugees, and displaced persons.



Iran's Rial Hits a Record Low, Battered by Regional Tensions and Energy Crisis

An Iranian trader counts money in Tehran's Grand Bazaar. (Reuters)
An Iranian trader counts money in Tehran's Grand Bazaar. (Reuters)
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Iran's Rial Hits a Record Low, Battered by Regional Tensions and Energy Crisis

An Iranian trader counts money in Tehran's Grand Bazaar. (Reuters)
An Iranian trader counts money in Tehran's Grand Bazaar. (Reuters)

The Iranian rial on Wednesday fell to its lowest level in history, losing more than 10% of value since Donald Trump won the US presidential election in November and signaling new challenges for Tehran as it remains locked in the wars raging in the Middle East.

The rial traded at 777,000 rials to the dollar, traders in Tehran said, down from 703,000 rials on the day Trump won.

Iran’s Central Bank has in the past flooded the market with more hard currencies in an attempt to improve the rate.

In an interview with state television Tuesday night, Central Bank Gov. Mohammad Reza Farzin said that the supply of foreign currency would increase and the exchange rate would be stabilized. He said that $220 million had been injected into the currency market, The AP reported.

The currency plunged as Iran ordered the closure of schools, universities, and government offices on Wednesday due to a worsening energy crisis exacerbated by harsh winter conditions. The crisis follows a summer of blackouts and is now compounded by severe cold, snow and air pollution.

Despite Iran’s vast natural gas and oil reserves, years of underinvestment and sanctions have left the energy sector ill-prepared for seasonal surges, leading to rolling blackouts and gas shortages.

In 2015, during Iran’s nuclear deal with world powers, the rial was at 32,000 to $1. On July 30, the day that Iran’s reformist President Masoud Pezeshkian was sworn in and began his term, the rate was 584,000 to $1.

Trump unilaterally withdrew America from the accord in 2018, sparking years of tensions between the countries that persist today.

Iran’s economy has struggled for years under crippling international sanctions over its rapidly advancing nuclear program, which now enriches uranium at near weapons-grade levels.

Pezeshkian, elected after a helicopter crash killed hard-line President Ebrahim Raisi in May, came to power on a promise to reach a deal to ease Western sanctions.

Tensions still remain high between the nations, 45 years after the 1979 US Embassy takeover and the 444-day hostage crisis that followed. Before the revolution, the rial traded at 70 for $1.