Companies that set up in dedicated special economic zones (SEZs) are afforded a host of advantages including incentives and services to support their operating needs. But with more than 5000 SEZs across the globe, competition for investment is fierce, heightened further by the economic fallout from Covid-19.
“Attracting international companies can be challenging for all world free zones, and to lead this challenge, we had to come up with an attractive financial regime for companies, along with other services provided by the law,” says Jaafar Mrhardy, general director of Tanger Med Zones (TMZ), the network of activity zones in Morocco’s northernmost region (see interview on page 106).
TMZ offers a host of incentives to investing companies, including exemptions on registration and stamp duties during the acquisition of land, and exemptions on both business and patent taxes for 15 years. TMZ also provides exemptions on corporate income tax for five years and a reduced rate of 8.75% for 20 years thereafter.
TMZ acts as a ‘one-stop-shop' which investors can approach to obtain the necessary permits, authorisations and licenses to be based in one of the Tanger Med activity zones
Marc Nassif, CEO of Renault’s Moroccan operations, says that TMZ is an agency that is “fully empowered” to provide investing companies all the support they need (see interview on page 110).
Since its inception in 2007, a total of Dh98bn ($10.74bn) has been invested in Tanger Med’s port and industrial platform, more than 37% of which came from the public sector, according to TMSA figures.
On top of these investments, the Moroccan state offers subsidies for industrial operators through the Hassan II Fund. This provides investment grants of up to 20% on a project’s total costs, for the acquisition of land and construction of production units. Other funds, such as the fund for automotive operations and FDI fund, can also offer support.
Services and support
TMZ has multilingual support teams that directly engage and assist investors, with an additional team of more than 100 engineers coming from Tanger Med Engineering, another subsidiary of TMSA, on site to support companies in specialised technical areas. This includes aftersales follow-up and a gate access platform, which enables convenient logistics access for companies hoping to export through Tanger Med port.
The one-stop shop offered by TMZ, with the option to have either ready-built facilities or greenfield sites, makes it particularly attractive given the mountainous terrain of northern Morocco.
“It would be difficult to find ready prepared sites, with the relevant infrastructure, site boundaries and right topography outside special economic zones in Morocco,” says Alex Ash, a global director of location strategy and incentives at site selection consultancy Hickey and Associates.
“Tanger Med Zones fully supports its investors,” says Mr Mrhardy, adding that assistance is also provided to companies in their search for talent to run their operations, through educational institutions.
Serge Giannitrapani, general manager of auto part manufacturer Marelli’s operations in Tanger Med Automotive City, says that TMZ has been a reliable partner and provided “many valuable contributions, such as advice about the local regulations, support in the field on specific subjects, interface on road blocks in case of possible difficult situations and mutual exchanges on best practices”.
Beyond the standard services and support that TMZ offers its tenants and clients across the industrial platform, it has stepped up to absorb the economic shock of the pandemic.
It contributed Ä30m to the National Moroccan Covid-19 Fund, whose purpose is to support companies directly affected by the pandemic, specifically tailored to start-ups and small and medium-sized enterprises.
This article first appeared in the December/January print edition of fDi Intelligence. View a digital edition of the magazine here.