MOROCCO - Focusing On The Economy.

With Pax Americana spreading and altering the geo-political landscape of the Middle East, Morocco is now giving as much importance to free trade arrangements with the US as to its deals with the EU. Outgoing US ambassador Margaret Tutwiler - a former State Department spokeswoman - said in August that an FTA would be signed before the end of 2003. On Aug. 26 she told the Moroccan TV channel "TVM" the signing of the agreement would be "a historic event".

Earlier in the year, in July, Tutwiler had stated that Morocco would remain "a strategic partner" for the US, in an interview given to the magazine Le Matin du Sahara et Du Maghreb and Assahra Al Maghribya. She also pointed out to "considerable progress" in negotiations between the two countries on the FTA. She said Morocco would become a model to be followed for other countries. Tutwiler added that two weeks ahead of the fourth round of negotiations, in Washington, the two negotiating teams - divided into 11 working commissions - had already lowered several constraints. Later she acknowledged that the agriculture aspect was "sensitive and complex," and insisted that the agreement advantages will be more numerous than its handicaps.

On July 22, the US Congress announced the creation of a Congressional Morocco Caucus with the objective of promoting strategic relations binding Rabat and Washington. Representative Phil English, one of four co-chairmen of the caucus that was founded at the initiative of Congressman Lincoln Diaz-Balart, said the parliamentary group was a step forward toward the conclusion of an FTA and will reinforce Moroccan-US relations.

In addition to investment and business opportunities which the FTA will open to both countries, it was judged that the agreement could also transform Morocco into a hub for regional trade given its geo-strategic location. Taib Fassi Fihri, Moroccan delegate minister for foreign affairs and co-operation and chief negotiator for the FTA with the US, told the Congressmen that their adherence to the new caucus showed that they shared Morocco's approach, vision and determination to cement the bilateral partnership.

However, it is significant that the FTA will encroach into issues that have a political side. The 2003 Index of Economic Freedom characterizes Morocco as a "mostly free" country with a very high level of protectionism. The US negotiators are pointing out that for American investors to take advantage of the liberalisation expected under an FTA, a strong rule of law must be established in the kingdom. According to the US-Morocco FTA Coalition, an FTA would "provide an opportunity to ensure the full implementation of a new Moroccan law allowing for the 100% foreign ownership in the insurance sector".

Conservative US think-tanks assessing American relations with Morocco are supportive of the FTA. But they also argue that the FTA should only come into force when Morocco matches economic liberalisation with improvements in the judicial system, institution of a strong rule of law, and enforcement of intellectual property rights.