A new Moroccan government plan targets 90,000 new jobs in the sector

A new Moroccan government plan targets 90,000 new jobs in the sector

Although Morocco’s garment manufacturing industry is well established, supplying giants such as Zara-owner Inditex, it is continuing to invest in capacity to compete with Asian rivals and new African competition.

As part of its 2014-2020 Accelerated Industrial Plan, the Moroccan government has assigned MAD3bn (US$304m) as grants for industrial small-and-medium sized enterprises (SMEs) with established supply chains and sales networks.

This new fund has been live since January 2015 and augments work being carried out by government development programmes Imtiaz and Moussanada.

Regarding the new fund, a government note says: "It is designed to help companies who have ecosystems in place to achieve their ambitions. Aid is granted in return for commitments on employment, value creation and exports."

Within the textile and garment sector, the government plan includes targets of "creating 90,000 new jobs, generating additional sales of MAD6.3bn [US$637m] in the sector."

Funding is available for registered medium-sized companies with a turnover of MAD100m (US$10.1m) or more, via Imtiaz and Moussanada, notably part-funding schemes for buying hardware, whereby Imtiaz gives 20% of the investment, up to MAD5m (USD505,000). To help boost competitiveness, Moussanada offers grants for buying software systems of up to 60% of the overall investment of up to MAD600,000 (US$60,600).

Tangier-based weaving company Codersa Sarl, which started working with Moussanada in 2012, has reported a 10% improvement in yields as a result. Human resources director Fouad Hadri Chouki said that before, production was "170,000 pieces per month and it is now 185,000 average per month". Other benefits have been a company restructure and improvement of production quality and modernised cutting practices.

Meanwhile, Tangier-based women’s wear and kids’ wear manufacturer Yara Confection, whivh received MAD250,000 (US$25,200) and invested MAD170,000 (US$17,100) of its own funds into developing final products, modernising cutting, other performance improvements and retouching, reported a 7.5% capacity increase since 2012. Its ambitions now are to improve strategy, development and logistics.

There is a clear understanding in the sector that Morocco must expand beyond trading with Europe to achieve sustainable growth.

Redouane Lachgar, commercial and development director at Tangier garment manufacturer Salsabile, says: "We will increase the capacity to develop the American market by adding six lines in production. For the equipment, we will invest mainly in sewing machines."

Innovation will also be key to Moroccan suppliers staying relevant. Casablanca-based denim company Crossing has introduced a creative research and development studio called ‘Love & Hate’ that is both a design lab to create new products but is also a very inspiring environment where buyers experience not only the product but the creative ideas behind them. "This is our R&D space where our creative team, staff members and our customers come together as a starting point for new inspirations, businesses and partnerships," the company says.

Access to finance underpins all this growth, of course. Government strategies for growth apart from grants include: "Support for investment, [creating] easier access to financing through the development of appropriate mechanisms in partnership with banks," according to a note from the Morocco ministry of commerce and industry.

The government also wants to encourage strategic partnerships, bringing industry companies closer together. "The goal is to promote the establishment of strategic alliances between large companies and SMEs and weave together relationships that go well beyond a mere payer of over subcontractor."

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