The Maghreb region: an emerging area with promosing prospects

With more than 90 million inhabitants and significant natural resources, the economy of the Maghreb region offers a promising dynamism in the current global economic situation. The GDP growth in Morocco is expected to be around 4.9% in 2015 and 3.7% in 2016, while it is estimated at 3% in 2016 against 1% in 2015 in Tunisia and at 4% in 2016 against 3% in 2015 in Algeria. The growing automotive industry is adding potential to the industrial opportunities in the region. The area’s geography, between the Mediterranean Sea in the North and the Atlantic Ocean in the West, makes it an increasingly strategic axis for the freight forwarding of industrial goods.

Morocco and the Tanger Med port at the forefront of the global trade

Morocco, the 5th most powerful African economy, wants to attract industrial companies by further developing its infrastructure. Several initiatives demonstrate this ambition. The Tanger Med port, inaugurated in 2007, is an example of this modernization. It has become one of the major players of industrial logistics worldwide. With a total capacity of more than 8 million containers among which 40% cover the African continent, Tanger Med has become a logistic hub with a major regional influence, if not global. Tanger Med is connected to 30 other ports and 20 countries around the world which allowed it to reach a $4 Billion turnover in 2014 in export and to attract over $2 Billion in private investment. The flow of consumption goods containers transiting through its waters is estimated at $30 Billion per year, and 650 companies from many different sectors are operating in the port.

Tanger Med offers a dedicated tariff-free zone which aims to facilitate, progressively and on a long-term basis, the creation of industrial, logistics and tertiary activity zones in Morocco’s hinterland and in the broader Gibraltar Strait area. For instance, the TFZ (Tanger Free Zone) has developed a new industrial offer dedicated to automotive industry and offshoring services*, providing entrepreneurs with ready-to-use workspace and a single counter to simplify the administrative paperwork and providing a customized assistance to investors.

More than 30,000 direct jobs were created thanks to this industrial area, the opening of a Renault plant accounting for 6,000 of them. Using its new infrastructure as a launching pad, Morocco has also achieved a remarkable progress in the high technology and aeronautic sectors. The latter area of activity, which emerged in the country at the beginning of the 2000s with the arrival of Safran, counts to date more than a hundred companies generating 10,000 jobs.

* Offshoring refers to delocalisation of companies’ service or production activities.

Algeria attracts automotive manufacturers and becomes a key market in the development of GEFCO

After the inauguration of a new Renault plant in Oued Tletat near Oran in 2014, it is now the turn of PSA-Peugeot Citroën to settle in the region. The Algerian government approved on December 17, 2015 the project of creation of a PSA plant for a total investment of €100 Million. The PSA factory will be situated near the Renault plant, on a 60 to 70 hectare area. This plant will produce 3 car models:  Peugeot 301, Peugeot 208, and Citröen C Elysée. The production is due to start at the end of 2018 – beginning of 2019. The plant’s capacity will grow from 25,000 to 75,000 cars produced per year, to reach 150,000 cars produced per year later on. Besides the production and assembly plant, the Peugeot site will integrate automotive equipment manufacturers and replacement parts manufacturers.

With a GDP growth of 3% in 2015 and exports reaching over €60 Billion, Algeria is a dynamic market increasingly requiring a presence of logistics providers offering complex supply chain solutions: with industry accounting for 47% of Algeria’s GDP, GEFCO is the ideal partner for industrial companies to develop their domestic and international activities. Algeria is notably the second automotive market on the African continent, therefore the settlement of GEFCO in this region in 2014 was a natural choice.
Just one year after the opening of its subsidiary in Algeria in 2014, GEFCO already became a major actor of national logistics on the market. The turnover is expected to reach €10 Million in 2015.

A rapid success on the Algerian market

As soon as GEFCO arrived on the Algerian market, the company took in charge the supply chain of finished vehicles for PSA and rapidly developed a partnership with SAIDA to manage the import of its cars to the Algerian market. After a year of activity, more than 55,000 finished cars have been transported by GEFCO on the Algerian soil. GEFCO has developed the first workshop of preparation of finished cars in Algeria, in Mostaganem, and rapidly opened another one in Bourafik. The latter offers warehousing and logistics management solutions as well, which allowed GEFCO to become the first multi-business platform in Algeria. This success was possible thanks to GEFCO’s expertise in the automotive logistics, as well as due to the growth of its freight forwarding activities.

A player of the local development offering freight forwarding solutions

With the support of its international network throughout 150 countries, GEFCO Algeria offers completely integrated freight forwarding solutions to successfully manage their intercontinental flows. These solutions include operations of logistics and customs, preparation of orders, cross-docking management, transit and gathering of the goods, quality control and final distribution. “As the only logistics expert to manage complex and global supply chains, we are happy to assist Algeria in its plans of industrialization and development of foreign trade”, said Luc Nadal, Chairman of the Board of GEFCO.

In line with the Group’s development strategy, GEFCO Algeria wants to develop its portfolio of clients in sectors such as textile, single parts and appliances.

The Maghreb highway, a strong axis of development for international trade
 

Trade within the region is still limited and is set to be facilitated with the creation of the Maghreb highway, a road going from Mauritania through Morocco, Algeria, Libya and Tunisia.

It will connect 55 cities, 22 international airports, the main ports and rail terminals, as well as key industrial areas in the region.

This highway will intensify the trade within the Maghreb in every sector, establish a better link between the region and Europe and facilitate the trade between the Northern and Southern coasts of the Mediterranean Sea. However, the political instability of the region could be a brake to this ambition. The last piece of the Maghreb highway, which is 22 km long and linking Oujda (Morocco) to the Algerian border, should be operational in 2019. The growth of trade will eventually depend on the reopening of the land border between Morocco and Algeria.

FIGURE OF THE MONTH

54… jobs were created by GEFCO Algeria during its first year of activity. To support the
projected growth, GEFCO will continue recruiting new talents in.