Morocco poised to become EV industry hub- Chatham House

Morocco is well-positioned to become a global hub for electric vehicle industries (EV) thanks to its control of the world’s largest phosphates reserves, its free trade deals with the EU and the US, availability of skilled labour and a growing automotive sector, London-based Chtaham House said.

Morocco has attracted Chinese EV battery giants looking to circumvent tariff barriers and tap into the country’s industrial potential, Chatham House MENA specialist Ahmed Aboudouh said in an analysis.

“The country controls 72 per cent of all phosphate-rock reserves worldwide – positioning it to become a global EV battery production hub as the world moves away from NMC lithium-ion batteries and adopts cheaper and safer lithium iron phosphate (LFP) batteries,” he said.

Morocco is also a member of China’s Belt and Road Initiative since 2017 after signing a strategic partnership agreement with China during King Mohamed VI’s 2016 visit to Beijing, he recalled

“This makes Morocco an ideal pick for offshoring China’s EV industry. Rabat’s biggest advantage is its free-trade agreements with the US and the EU and its membership in the African Continental Free Trade Area (AfCFTA),” he said.

“Its geographical proximity to the EU, African and US markets reduces shipping and insurance costs,” he said, adding that “Morocco also has some of Africa’s most advanced car industry infrastructure, rail and road systems, well-trained and cheap labour and a mature manufacturing governance framework. Its relative political and social stability and economic openness make it a magnet for foreign investors.”

However, as Chinese companies pick Morocco and Mexico as offshore hubs, the US and European are taking protectionist stands that could lead to further trade restrictions on goods originating from joint ventures involving third parties which could affect Moroccan EV battery exports, he said.