Morocco and Saudi Arabia work towards a strong investment and trade partnership

Morocco and Saudi Arabia, two leading Arab countries in North Africa and the Middle East respectively, are seeking to further deepen their economic relationship. Both nations are working on the establishment of a joint fund aimed at investment and the development of trade links and exports. 

Efforts in this direction could provide a great opportunity to boost Morocco's economic growth and further establish the Saudi kingdom as the largest economy in the Middle East by volume.  

Morocco is working along these lines with a view to strengthening economic ties with the Saudi kingdom, mainly in the areas of investment and trade, and it seems that the Saudis are also well attuned to this, according to economic sources in the North African country consulted by the Al-Arab media. 

Rabat and Riyadh plan to implement a joint entity aimed at promoting investment and exports, as part of an ambitious plan for economic relations that has been in the pipeline since 2021. Khaled Ben Jelloun, head of the Moroccan-Saudi Business Council, told Bloomberg that the two countries are studying the creation of a joint fund to support medium and small businesses for export and investment in the two countries, with the aim of increasing the volume of trade between the two nations. Thus, the Moroccan-Saudi Business Council is considering the creation of this joint fund to support medium and small businesses for export and investment and Khaled Benjelloun said that the objective behind the creation of such a fund would be to increase internal trade between the two countries. 

The public and private sectors of both nations are expected to participate in the establishment of the fund, including major Moroccan banks, led by Attijariwafa Bank, Banque Populaire, Crédit Agricole du Maroc and Bank of Africa. On the Saudi side, the Saudi Investment Bank and the Islamic Corporation for Private Sector Development, an affiliate of the Islamic Development Bank Group, will contribute to the new entity's capital, according to Al-Arab. However, there is still no definite date for the launch of the shared investment fund.  

Contacts were made last week in this regard in the Moroccan city of Casablanca and Ben Jelloun explained that the fund "will serve as a unified window to facilitate financing and logistical procedures to support the orientation of companies for export and investment between the two countries". Thus, during a recent meeting of the Moroccan-Saudi Business Council in Casablanca, council members highlighted several Moroccan products that have the potential to increase the volume of Morocco's exports to Saudi Arabia, including textiles, handicrafts, auto parts, food products and technological products. 

Trade between the two Arab countries is still largely dominated by oil, where there is strong Saudi dominance, and agricultural products, where Morocco is also a major player. However, the two countries are currently working to diversify their trade and boost it in other sectors. 

The pandemic affected world trade, including, of course, Morocco and Saudi Arabia. And now this investment and trade tool to be implemented aims to revive trade between the two countries as much as possible. According to figures from Morocco's Ministry of Trade and Industry, trade exchanges between the two countries in 2021 amounted to some 17.2 billion dirhams ($1.7 billion), of which 10 billion dirhams (about $1 billion) was for the import of oil and its derivatives from the Saudi kingdom.  

Morocco's Minister of Industry and Trade, Ryad Mezzour, said the kingdom wants to increase exports to the Saudi market from the current $70 million to $500 million, as reported by Morocco World News. These values show that there is work to be done in this regard. 

Khaled Ben Jelloun believes that the possibilities for increasing trade between the two countries are "very great", and at the same time, he called for overcoming all administrative and logistical obstacles in order to take the trade relationship to a much higher level.  

Morocco ranks 54th among countries exporting to Saudi Arabia, and its exports include inorganic chemicals, automobiles, spare parts, fruit and clothing, and it is the oil-producing country's number one partner among countries in the Arab region.