MOROCCO ECONOMIC HIGHLIGHTS

UNCLAS SECTION 01 OF 02 RABAT 001111 SIPDIS SIPDIS DEPT FOR NEA/MAG, NEA/OFI AND INL/AAE DEPT ALSO FOR EB/TPP, EB/IFD AND DRL/IL STATE PASS USTR FOR DOUG BELL STATE PASS USAID FOR JENNIFER RAGLAND USDOC ITA/MAC/ANESA FOR NATE MASON USDOC FOR FSC/OIO AND CLDP USDOL FOR ILAB PARIS FOR ZEYA LONDON FOR TSOU ROME FOR ROSE E.O. 12958: N/A TAGS: ECON ETRD EAGR KNNP SOCI MO SUBJECT: MOROCCO ECONOMIC HIGHLIGHTS REF: 05 RABAT 1636 -------------- Big Growth Ahead? -------------- ¶1. Moroccan economic think tank Centre Marocain de Conjoncture (CMC) is forecasting that the economy will grow by 7.1 percent in 2006, outpacing GOM forecasts of 5.4 percent. The CMC said strong farming output will be the driver behind the growth. The GOM had predicted 5.4 percent growth on the assumption of a cereals harvest of six million tons, whereas the Ministry of Agriculture has more recently said Morocco is expecting a harvest of 8.6 million tons, the biggest crop in ten years. The projected 7.1 percent GDP rate would be the highest since 1998 when the economy grew by 7.7 percent. The economy is growing less dependent on agriculture, but the swing from an anemic 1.8 percent growth rate last year to an anticipated five to seven percent this year underlines the fact that the economy is still highly reliant on farming. -------------- U.S.-Morocco Phosphates Deal -------------- ¶2. Maroc Phosphore, an affiliate of Moroccan state-owned phosphates group OCP, signed a long term purchase agreement with Minneapolis-based Mosaic Company through which the Moroccan firm will supply Mosaic with 200,000 tons of granular triple superphosphate (GTSP) per year for distribution on the North American market. The deal runs through 2011 and is renewable upon mutual agreement at that time. State-owned OCP is the world's largest producer and exporter of phosphate rock and the world's largest exporter of phosphoric acid. The value of Morocco's phosphates and chemical fertilizers exports increased by 50 percent in the first four months of 2006 compared with the same period last year. -------------- Tender for U.S. Wheat -------------- ¶3. On May 30, the Moroccan cereals office (ONICL) accepted importer bids for the first time under the U.S.-Morocco Free Trade Agreement for licenses to import 40,000 tons of U.S. durum wheat at the preferential duty granted under the tariff rate quota (TRQ) of the agreement. Bids were accepted from three importers for the full 40,000 tons announced in ONICL's April 10 tender. Licenses to import under the preferential TRQ duty were sold for $17.88 per ton. This was the first tender enacted for U.S. wheat under the FTA. It drew a total of 22 bids for 140,000 tons and was attended by the largest players in the Moroccan durum wheat market. -------------- Nuclear Research Reactor Delayed -------------- ¶4. The start up of Morocco's much-delayed nuclear research reactor has been pushed back to July or August, after the arrival of damaged fuel rods from France. The two megawatt RABAT 00001111 002 OF 002 reactor, built by General Atomics (Ref A),will be the pride of Morocco's National Center for Energy, Sciences and Nuclear Techniques (CNESTEN). Department of Energy contractors and other visiting U.S. specialists routinely report that CNESTEN's staff extremely technically competent and that the center's directors go out of their way to remain transparent in their preparations for the reactor's commissioning. -------------- Coupe du Monde, Out of Bounds? -------------- ¶5. With kickoff just hours away, Moroccans are facing for the first time the dire possibility that national TV stations RTM and 2M will not show the World Cup soccer tournament. According to Moroccan government officials, Saudi broadcasting company ART, which owns the retransmission rights of all World Cup games for the Arab world, has refused to negotiate with Moroccan public TV stations to license viewing rights. ART offers the games by private subscription costing 1,200 dirhams, or about $140, far out of the range of most Moroccans. With their access to pirated satellite TV channels TF1 and M6 recently cut off, many Moroccans are in a state of panic. Cafes and bars that have purchased the ART package stand to reap a windfall from patrons who will pack these establishments for a glimpse of the world's largest sporting event. RILEY