MOROCCO,S MIDDLE CLASS PART I: A STATE OF MIND

UNCLAS CASABLANCA 000036 SENSITIVE SIPDIS STATE FOR NEA/MAG STATE PLS PASS TO COMMERCE FOR NATHANIEL MASON E.O. 12958: N/A TAGS: ECON MO PGOV PREL SUBJECT: MOROCCO,S MIDDLE CLASS PART I: A STATE OF MIND -------------- Summary and Introduction -------------- ¶1. (SBU) King Mohammed VI's August 2008 directive that all public policies should seek to develop Morocco's middle class has prompted a spirited debate and discussion on the makeup of that middle class in Morocco today. For now, there is no consensus on the definition, even within the government. What constitutes the middle class is relative, not easily defined, and in Morocco today mostly a state of mind. The government,s inability to reach a common definition has impaired and will likely continue to impair the country's efforts to strengthen this sector of the population. ¶2. (SBU) This cable, the first in a three-part series, looks at what, exactly, constitutes the middle class in Morocco today. The second cable will examine the factors contributing to the stagnation of Morocco's middle class, and the third cable will look at public and private initiatives to develop that middle class. This series is based on observations drawn from our discussions with government interlocutors, civic society, academia, and the business community. End Summary and Introduction. -------------- The Royal Decree -------------- ¶3. (SBU) Late last summer, King Mohammed VI expressed his "firm wish to ensure that all public policies are strategically devoted to developing the middle class, so that it can be the foundation of the social structure, the basis of stability, and a powerful catalyst for production and creativity." With the King's mandate in hand, a plethora of government agencies ranging from the Ministry of Finance, to the Ministry of Education, to the Ministry of Economic Affairs scrambled to formulate a unified action plan to strengthen the middle class. This effort has run up against a lack of agreement about who, exactly, is the middle class in Morocco today. To address this impasse, Prime Minister Abbas El Fassi last fall created a special committee charged with developing policies to bolster the middle class, beginning first and foremost with defining this segment of the population. Five months since its inception, the committee has yet to reach a consensus on that definition. -------------- -------------- What constitutes the Middle Class in Morocco Today? -------------- -------------- ¶4. (SBU) The lack of a universally accepted definition is largely due to the fact that the middle class is relative and not easily defined. Our discussions with government officials, the private sector, and civic society highlight the wide range of criteria used to define this group: income level, purchasing power, access to world culture, aspirations, and education. "The definition of Morocco's middle class has been stretched to the point of irrelevancy," says Professor Bekouchi of Hassan II University. ¶5. (SBU) According to sociologist Michel Peraldi, the middle class may constitute anywhere from 5 percent to 25 percent of the population depending on the definition used. Economists in Morocco generally divide the middle class into two sub-categories, according to Bekouchi. About one-third are the upper professional middle class families consisting of highly educated and salaried professionals. The remaining two-thirds are lower middle class families compromising mostly of semi-professionals and skilled craftsmen. ¶6. (SBU) In its effort to grapple with the concept of middle class, the Moroccan government has put forward a range of definitions. In December 2008, Finance Minister Mezouar defined the middle class as a household (defined as a family of four) generating between USD 1100 to 1700 per month. Others, including the Ministry of Housing and the Ministry of Health, however, argue the middle class falls below this level, questioning how a family earning USD 20,000 per year can be considered "middle class" in a country where per capita income is just over USD 2500 per year. This inability to reach a common government definition has serious consequences, according to a senior official of Attijariwafa Bank, who believes it will hinder any progress on GOM plans to bolster the middle class. ¶7. (SBU) Outside of the government, the private sector has been equally unsuccessful in formulating a single definition that is narrow enough to be meaningful. A recent market study by Procter and Gamble very loosely indentifies the middle class as a household earning between USD 350 to 2100 per month. According to Procter and Gamble, the middle class represents about 23 percent of Morocco,s population. In a similarly broad fashion, a senior official at one of Morocco,s largest banks defines the middle class as a household earning between USD 625 to 2125 a month, noting that this group represents 70 percent of his bank,s customer base. Civil society, however, provides a more specific concept. The Center for Social, Economic, and Managerial Studies (CESEM) recently conducted an extensive nationwide survey and more narrowly defined the middle class as earning between USD 1350 to 1700 per month per household. -------------- Middle Class is a State of Mind -------------- ¶8. (SBU) Data aside, being "middle class" in Morocco today appears to be less a question of income and more a social label with cultural connotations. "Everyone wants to believe they are middle class", says Professor Bekouchi. Surveys have shown that, while Moroccans consider USD 1,100 per month to be at the low end of what it takes to live the middle class life, some families who make as much as USD 2,5000 per month still consider themselves middle class, says Michel Peraldi. For Peraldi, this demonstrates that "income tells only part of the story. Middle class is all relative". ¶9. (SBU) Our contacts in business and academia do agree on one thing: those who define themselves as members of Morocco,s middle class share a certain set of values - values that emphasize independence, modernity, innovation, non-conformity, and disaffection for the political process. Their self-perception is one of an emerging yet influential part of society. Another agreed upon characteristic is that women are seen as the key enabler to middle class status. One financial analyst jokingly told Econoff, "The one sure way to obtain middle class status is to marry a professional Moroccan woman." MILLARD