Frequently Asked Questions

Basics by Free Trade Agreement: Morocco

Why Morocco?

The U.S. private sector supports the Agreement because it:

1. evens the playing field with European competitors;

2. expands market access;

3. bolsters economic reforms already underway in Morocco;

4. builds on a long history of close U.S.-Moroccan relations;

5. promotes jobs, democracy, and stability; and

6. furthers President Bush's goal of a broader United States-Middle East Free Trade Agreement.

The Agreement reinforces many of the economic reforms undertaken by Morocco in the past five years. King Mohamed VI has moved his country away from economic central planning. Morocco has already begun to liberalize its telecommunications sector, reform its audio/visual industry, modernize its financial sector, and enact strong legislation to protect intellectual property rights ("IPR"). The Agreement helps solidify and expand these benefits, enhancing prospects for US companies. Other countries in the Middle East, also interested in free trade agreements with the United States, are looking at this Agreement as an example for their own economic restructuring and development. The Agreement will promote job growth, stability, and democracy in Morocco, a close Arab ally of the United States, as well as here at home. Job creation is one of the United States and Morocco's highest priorities. The Agreement creates opportunities for new U.S.-Moroccan business partnerships that can, in turn, spur employment gains in both our countries. Finally, increased trade will support Morocco's move toward greater democracy. Morocco's October 2002 parliamentary elections were widely hailed as free and fair. In those elections, Morocco permanently reserved more than 10 percent of Parliament's seats for female lawmakers. Morocco has been a steadfast ally in the war against terror. The United States and Morocco have maintained a long, cooperative relationship. Morocco was the first country to recognize the independent United States and the country with which we have the longest treaty relationship. The Agreement is the capstone of a bilateral relationship that dates back more than two centuries.

Parity with the European Union:

The European Union and Morocco implemented a free trade agreement ("Association Agreement") in March 2000. Over the last 10 years, EU exports to Morocco have doubled. Between 1999 and 2001, European goods accounted for nearly 60 percent of Moroccan imports, while U.S. goods accounted for less than 6 percent. The Agreement levels the playing field for U.S. companies vis-à-vis their European competitors and helps increase U.S. market share in the North African market. In short, the Agreement provides parity for U.S. export priorities with the European Union. In addition, the design of the Agreement is comprehensive; it includes services and investments, as well as goods and commodities. For U.S. service providers, this means that existing barriers to services trade (i.e., capital requirements and regulatory frameworks have been made more transparent, been decreased, or will be phased-out completely). By contrast, the EU-Morocco Association Agreement contains more limited, less comprehensive services commitments and does not contain the high-standard investment protections available to U.S. investors under the Agreement.

Middle East Free Trade Area:

Morocco is the North African pillar in a U.S.-Middle East Free Trade Agreement (MEFTA), as announced by President Bush in May 2003. MEFTA reflects the U.S. government's long-term commitment to promoting economic growth, expanding opportunities, and ensuring stability in the region. The region-wide free trade agreement, to be completed by 2013, will provide new export opportunities to U.S. farmers, ranchers, and manufacturers. Jordan and Israel are already FTA partners; negotiations with Bahrain were recently concluded.

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