What about Morocco?

Morocco is in many ways a country apart. It is situated on the extreme northwestern corner of Africa and is bordered by Mauritania to the south and Algeria to the east. The country is ruled by King Mohammed VI, who appears to be leading Morocco toward both long-term stability and a greater degree of economic prosperity. The political climate, a greater focus on human rights, and economic growth all make the Moroccan model stand out. Sika Morocco has been in business for 33 years, driven forward by General Manager Claude Juillard for the past 16 of these. The main facility is based in Casablanca, comprising a showroom and two production plants. The company also has an office in Tangier. Sika Morocco with its 109 fully committed employees is expecting to see production rise to 20,000 tons by the end of the year. The smell of the Atlantic Ocean was in the air when we met Claude Juillard, General Manager, and Marouane Zohry, Director of Concrete & Waterproofing, in Casablanca.

The whole world knows Casablanca – at the very latest when they get to see Humphrey Bogart look into Ingrid Bergman’s eyes. The city has changed a lot over the last few decades and is now the largest in Morocco. Is there anything you miss from the olden days that you would like to bring back?

When the French seized Casablanca in the early 1900s, they turned the historic Moroccan port into a classic of colonial architecture that was to be immortalized in the 1942 namesake film. In the decades since the release of "Casablanca", real estate development and property speculation have reshaped the city into one bearing little resemblance to its movie depiction, and preservationists are increasingly fretting about what will become of the crumbling French colonial facades, neo-Moorish details and Art Deco hotels. Indeed in this fast moving economic environment, real estate developers are often looking to buy historic properties, tear them down and build more modern apartment buildings. The present population of Casablanca is estimated at a little over 3,299,400, making it the largest city in Morocco. Thanks to the tramway and the entire modernization process, the city is entering a new phase. That being said, urbanization is tending to be more and more authentic and protective of the old style while still embracing the modern way of life. Casablanca is one of Africa's four largest cities. The rapid commercial progress witnessed by Casablanca, especially the growth of its port, has established it as the economic capital of Morocco. We cannot fail to mention the beautiful Hassan II Mosque, one of the biggest in the world. Over 6000 traditional Moroccan artisans worked on this phenomenal building over the course of its construction. The project cost more than half a billion dollars and was paid for largely by public subscription. As Morocco’s principal center for recreation, Casablanca boasts a number of pleasant beaches, parks, and attractive promenades along the seafront. Casablanca is a sprawling, vibrant metropolis which is resolutely turned toward the future.

Is it true that Casablanca derived its name from the many white houses, just as Marrakech has numerous red houses? Or is there something else behind the name?

An Amazigh (Berber) village called Anfa stood on the present-day site in the 12th century; it became a pirates’ base for attacking Christian ships and was destroyed by the Portuguese in 1468. The Portuguese returned to the area in 1515 and built a new town called Casa Branca (“White House”). It was abandoned in 1755 after a devastating earthquake, but the ʿAlawī sultan Sīdī Muhammad ibn ʿAbd Allāh rebuilt the town in the late 18th century. Spanish merchants were the ones who named it Casablanca, and other European traders began to settle there.

Speaking of business, Morocco and the surrounding Maghreb States offer a very versatile and challenging environment for multinational companies. Where do you see the opportunities?

Morocco has witnessed an economic boom, with the construction sector playing a major role in this dynamic evolution. The government consistently invested in major projects and supported initiatives to establish several free zones in Morocco. Instituted by law in 1994, export processing zones are designated authorized areas within the customs territory that are exempted from customs regulations, foreign trade and exchange control, all industrial and commercial export levies as well as associated service levies.

The existence of these zones is a real chance for Sika Morocco since it stimulates the construction of infrastructure for businesses located here. The country has many strengths that suggest that growth will not be restricted to the coming years only. Indeed, Morocco has a stable political environment that enables implementation of a real economic strategy over the long term. Worthy of mention in this regard is the National Pact for Industrial Emergence, the goal of which is the revitalization of certain sectors of industry. In the face of the challenges of an evolving global economy, the pact aims to build a strong industrial sector and create a virtuous circle of growth. The state and the private sector have sealed this covenant by signing a contract program covering the period 2009-2015. By consolidating their mutual commitments into one document, partners bring to investors the necessary visibility on the changes of the future Moroccan industry. The emergence pact sets specific target in terms of contribution to GDP, export and employment for six sectors considered to have high growth potential: aeronautics, offshoring, food, textiles, electronics and automotive.

The slowdown in activity in Europe, Morocco’s chief economic partner, and below-average agricultural production resulted in a distinct slowdown in the growth of Morocco’s economy. What is the outlook in your opinion?

According to the Haut Commissariat au Plan, the Moroccan GDP grew 4.30 percent year-on-year in the second quarter of 2013. However, Morocco will have to deal with different challenges going forward.

There is not much evidence of modernization and refurbishment work being carried out on buildings. In fact, the construction sector in Morocco is largely dominated by small poorly regulated sites. The players in Morocco’s construction market are, however, still relatively heterogeneous. In the majority of cases, the mix of workers and methods testify to differing levels of technological competence. Parallel market and unscrupulous practices are commonplace.

In this challenging environment, Sika Morocco has strengthened its quality commitments, its enterprise value and its unwavering ethical standards to remain the leader in this market. The person-based relationship established with customers and partners, small retailers and hardware stores, craftsmen and small businesses is the cornerstone of this success. The next challenge ahead for Morocco is to ensure a transition to a more standardized and regulated market. Sika Morocco is working every day in this direction.

How about the construction market? Where does Morocco need Sika?

Beyond public investment, the construction sector attracts a large number of private investors. In 2011, foreign direct investment (FDI) to the construction industry accounted for 32% of total FDI in Morocco. The construction industry is still the biggest hiring sector in the kingdom in spite of the difficulties it is currently facing. Large construction projects are abundant: the highway network grew from 1000 km in 2000 to 1,500 km in 2012; the Tangier-Casablanca high-speed rail (HSR) link, scheduled to start operating in 2015, will be the first of its kind in Africa; Tanger-Med (more than 4 million containers in 2013, 7 million expected in 2017) is the major African harbor in terms of transshipment. In addition, integrated industrial platforms and technology centers are still under development. The OCP (the Moroccan global leader in phosphates extraction and transformation) has also launched a huge investment program. The tourist and housing sectors are likewise contributing to the growth. Notable development projects are underway in the hydraulic infrastructure (including a dam and hydro power station) and energy sectors (new thermal power plant in Safi for instance), all of which spell good prospects for our industry and other construction markets.

However, Morocco’s years as an “open site” seem to be over. Cement consumption has plummeted since 2012. In late August 2013, the cumulative sales of cement continued their downward trend with a decline of 10.16% compared to the same period last year. This sharp decrease is due to the economic recession in Europe and to the political climate in the Maghreb countries, which is slowing down the FDI.

Previously, the main challenge facing Sika Morocco was to stay competitive in a local market where the majority of competitors were offering much cheaper products, but at much lower quality. In recent years, construction strategy in Morocco has moved more towards the development of infrastructure and buildings in collaboration with global actors.

Among the different governmental construction projects in place is the "Cities Without Slums" program, which promotes the construction of homes of lower quality. The Finance Act 2013 also represents genuine opportunities since it provides a series of incentives to encourage the construction of new housing for the middle classes.

In addition, the government is currently working on a new draft construction code including increased quality control of recycled materials. This is a new direction that is certain to strengthen Sika’s position in Morocco’s construction market.

The automotive and bus industry is growing and the distribution network for our industry’s specialized products is undergoing a major modernization program. The outlook is encouraging for the industrial market, the double glazing industry is expanding and promises a bright future, as do the sustainable energy plants scheduled for construction in southern Morocco.

Moreover, Sika Morocco´s commitment to developing its integrated management system is a key step in the way forward initiated by Morocco in recent years. Sika Morocco promotes the use of best quality materials and thus encourages the construction of more sustainable, eco-friendly infrastructures. In this context, Sika Morocco provides training to sensitize laboratories and lawmakers to the related problems.

Finally, in terms of social engagement, Sika Morocco employees receive training to help them to improve their professional skills and methods. Between 2011 and 2013, more than 100 employees attended training sessions, representing 88 hours of training per person on average over three years.

Are there any extraordinary Sika projects you would like to tell us about?

Our products are used on several major projects in Morocco and we want to highlight two of the most important:

1. The Tanger-Med project, one of the largest port complexes in the Mediterranean basin, is a key project of ours. We dedicated a lot of time and effort to becoming the main supplier for concrete admixtures, release agents, hardeners, mortars and other products. To ensure a better service, we have a new one-man office in Tangier dedicated almost completely to this key account. Our Tangier-based civil engineer specializes in concrete and waterproofing applications. This close customer strategy proved so successful that we plan to repeat it for other key account project management operations in different parts of the country.

2. The Morocco Mall is one of the 5 largest malls in the world. We provided our full range of products from concrete admixtures, through tile adhesives to coating resins for the construction of the 80,000 m2 parking facility.

3. Sika Morocco is named supplier for the famous Marina Casablanca project, the up-and-coming multi-purpose center of the city of Casablanca.

4. We are also working on other major projects such as the new port of Jorf Lasfar, new OCP industrial complexes, and the Tangier–Casablanca high-speed rail link.

What is Sika Morocco going from here?

The next steps are to continue to strengthen our leadership position in the Moroccan chemical building materials and industrial segments by maintaining our policy of research and development of innovative products and solutions, as well as to sharpen our business strategy of proximity through an enhanced regional presence.

Further to the acquisition of Axim Maroc by Sika Morocco in 2012, the main challenge has been to integrate the new team and to develop strong communications between the two entities. We have succeeded to date and now need to transform the trial into a winning shot. In the long term, our goal is to transfer the entire production of concrete products to the fully automated Ain Sebaa factory (former Axim). We have also started the quality certification process for the Ain Sebaa production site, which must be completed by mid-2014.

The Human Resources and Quality departments are also looking into obtaining social compliance certification. This will help us to improve our social policy through the application of guidelines and procedures. We should also like to mention that our main location based in Bouskoura (close to Casablanca) is currently undergoing redevelopment, entailing reorganization of the Pouder production site and extension of the existing plant. The objective behind the new storage zone here, which will raise storage capacity by 70%, is to increase mortar production capability. Last but not least, this construction project (due for completion end-2013) will also enable us to create recreation areas for employees. In 2014, we plan to extend the administration offices, which are also in the Bouskoura area. It should also be noted that we aim to attract even more visitors to our website in 2014 through the development of new web marketing tools.

What do you personally wish your country for the future?

Claude Juillard: I personally wish Morocco to keep moving on, to win market share in the global economy and to succeed in maintaining a sensitive balance between competition and social enforcement. We are living in troubled times, and Morocco has not only succeeded in defending its position, it is also becoming a key player, acting as a hub between Africa, above all with Mauritania, and other parts of the world. As General Manager, I am only too pleased to be able to work in such a winning environment.

Marouane Zohry: I am Director of Concrete & Waterproofing, and all purely Moroccan-manufactured products. I hold a degree in civil engineering from a renowned school of engineering in Morocco. I am directly involved in the modernization and development of several infrastructure systems in my country. While this is certainly good for business, it also represents a major step forward for Morocco, and I am proud to be able to contribute to it. For this reason, I really feel part of the effort to build the general environment for my fellow citizens and future generations to live in.