Israel-Morocco economic ties warming up

Morocco's King Mohammed VI Photo: Reuters
Morocco's King Mohammed VI Photo: Reuters

Foreign Minister Yair Lapid visits Rabat later this week with more bilateral agreements to be added to last month's cybersecurity agreement.

Morocco and Israel have signed a cybersecurity cooperation agreement. This is the first cooperation agreement signed by the two countries since they established diplomatic relations last year. The agreement was signed last month with the foundations laid during a visit by Ministry of Foreign Affairs director general Alon Ushpiz ahead of Israeli Minister of Foreign Affairs Yair Lapid to Morocco later this week.

In addition to the agreement, Ushpiz mapped out the steps required to promote economic and trade cooperation. Minister of Economy Orna Barbivay is also expected to visit Morocco in the coming weeks at the head of a delegation of businesspeople and industrialists.

The cybersecurity agreement was signed in Rabat between Israel National Cyber Directorate head Yigal Unna and his Moroccan counterpart General Mostafa Elrabii and Moroccan National Defense Administration Minister Abdellatif Loudiyi. The agreement puts in place cooperation in operations, R&D, data sharing and protection, and more. The agreement was reached with the close participation of Israel's Ministry of Defense.

The agreement comes in the wake of allegations that the Moroccan security services used the Pegasus spyware of Israeli company NSO for breaching mobile phones and surveillance of opponents of the regime and even French President Emmanuel Macron. Morocco denies the charges and the agreement just signed, a senior source said, has no connection and deal with completely other areas of activity.

Last week Moroccan Prime Minister Saad-Eddine El Othmani, head of the Islamic Justice and Development Party, and a supporter of the Palestinian struggle, said that he would not be meeting with Lapid during his visit to Morocco. Israel's Minister of Foreign Affairs will have to make do with meeting his Moroccan counterpart Nasser Bourita.

Lapid's visit is part of the major momentum in economic and trade relations between the two countries. Trade has not taken off to the same extent as between Israel and the UAE but after the establishment of Israel's new government, the two countries plan to promote a trade infrastructure and more agreements will be signed.

According to an Israeli diplomatic source, Morocco expects, if there are no obstacles or surprises, to announce the raising of its diplomatic representation in Israel, with the opening of an embassy, probably in December to mark one year since the signing of the normalization agreement.

According to Steve O'Hana, a businessman and industrialist and President of the Morocco-Israel Business council, the biggest obstacles to trade are in the areas of taxation and banking. He says an agreement to prevent double taxation is needed, and agreements that will allow the transfer of business information, banking between the countries and direct money transfers will speed up trade.

Annual export potential of $250 million

The normalization agreement signed as part of the Abraham Accords was signed by former Prime Minister Benjamin Netanyahu has led despite the Covid pandemic and the political crisis in Israel to a real rise in exports to Morocco. According to the Federation of Israeli Chambers of Commerce, Israel's exports of good to Morocco in the first half of 2021 amounted to $13.2 million, compared with $8.1 million in the first half of 2020.

In 2020, exports totaled $12.4 million, compared with $3.9 million in 2019. Imports of goods from Morocco amounted to $6 million in the first half of 2021, similar to $5.9 million in the first half of 2020. Total imports of good from Morocco in 2020 was $10.2 million, up from $9.8 million in 2019. These figures do not include services including tourism.

These are not big amounts in Israeli terms but according to the Israel Export Institute the potential of annual exports to Morocco is about $250 million, mainly in agricultural inputs, water treatment, digitalization and smart tech industries including cybersecurity, homeland defense, digital health systems, and smart cities as well as renewable and clean energy, mainly solar energy.

Tourism also offers major potential. According to O'Hana, even before Covid 50,000 Israeli tourists visited Morocco each year and the inauguration of direct flights and relaxations in granting visa will cause this number to rise sharply.

This week the Israel-Morocco Chamber of Commerce will open with former MK and Israeli Ambassador to the UN Yehuda Lancry likely to head it. Lancry told "Globes" that tourism is very important for both countries not only for economic reasons but in bringing Israelis and Moroccans closer together.

Among agreements expected to be signed in the coming few days is one between the Federation of Israeli Chambers of Commerce and the Moroccan Investment and Trade Agency, a government body responsible for national and foreign investments as well as exports of goods and services. The agreement will promote exports to Israel and encourage investments and the entry of Israeli companies into Morocco.

Published by Globes, Israel business news - - on August 10, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Morocco's King Mohammed VI Photo: Reuters
Morocco's King Mohammed VI Photo: Reuters
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