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Monday, February 11, 2013

The benefits of USMFTA

The US-Morocco Free Trade Agreement (USMFTA) is a bilateral  trade agreement between the United States and Morocco. The agreement was signed on June 15, 2004, followed by U.S. President George W. Bush's signing of the USMFTA Implementation Act on June 17, 2004. 
This FTA is believed to have many benefits for both partners. I chose to represent some of them.

First, as a result of the U.S.-Morocco Free Trade Agreement (FTA), 95% of U.S. consumer and industrial goods exported to Morocco no longer need to pay a tariff. Tariffs on U.S. goods export to Morocco will be phased out entirely by 2024. Since the agreement entered into force on January 1, 2006, the value of U.S. exports have risen from $481 million in 2005 to $1.95 billion in 2010. This translated into a trade surplus with Morocco of $1.26 billion in 2010, a 3,505% increase over the $35 million trade surplus of 200. In the same year, 92 US comapanies, 12 franchises, 9 liaison offices, and 22 NGO's schools, and USAID contractors have opened for business in Morocco. Most of the companies are large ones such as 3M, BF Goodrich, Amirecan Express, Caterpillar, just to name a few.
Second, the FTA also expands the significant protections already afforded U.S. investors under a Bilateral Investment Treaty (BIT) signed in 1985. All forms of investment are protected under the FTA, including enterprises, debt, concessions, contracts and intellectual property. U.S. investors will enjoy in almost all circumstances the right to establish, acquire and operate investments in Morocco on an equal footing with Moroccan investors, and with investors of other countries. U.S. investment in Morocco stood at $233 million in 2009.
Third, U.S. companies that build production facilities in Morocco today will have an added advantage of exporting industrial products duty free to Europe by way of the Moroccan-E.U. Association Agreement signed in 2000. In addition, once the EU's Euro-Mediterranean Free Trade Area (EMFTA) is complete in 2010, additional duty free access will flow down to U.S. companies. This duty free access to the European market is of commercial and financial interest to U.S. businesses.

Finally, FTA with Morocco also has value for the US as a tool for stabilization and devvelopment and as a carrot in foreign-policy negotiations. An FTA with Morocco could aid the development of this poor country. 

Sources:

Bruce Arnold (July 31, 2003), The pros and cons of pursuing free trade agreements, Almanac of Policy Issues. Retrieved from: http://www.policyalmanac.org/economic/archive/free_trade_agreements.shtml

http://export.gov/fta/morocco/index.asp

http://en.wikipedia.org/wiki/Morocco%E2%80%93United_States_Free_Trade_Agreement#Benefits_of_the_USMFTA

Brain drain issue in Morocco

Today's blog subject is going to be about Moroccan brain migration; a phenomenon that has a great effect on the economy and prosperity of Morocco. In doing my research on the topic, I came across a video and an article that covered all the aspects that are related to this phenomenon, and that reflect my opinion about it. So, I’ve chosen to translate the content of the article from Arabic to English.

Short description of the phenomenon of Moroccan brain migration

In 1986, Dr. Mehdi ElMandjra- the Moroccan futurist who used to work as Deputy Director of UNESCO in human and social sciences- warned about the dangers and impacts of brain migration. Dr. ElMandjra had the chance of participating to the study that was realized by UNITAR and that was about brain migration and its economic impacts. In his book “Premiere Guerre Civilisationnelle" (1991), Dr. ElMandjra mentioned that more than 700 Moroccan researchers at the doctoral level and above work on the French National Center of research, and that the cost of forming each of these experts for Morocco was about 1.000.000 Dhs (120.550$).
Professor Abdelaziz Rebbah -IT official at the Moroccan Ministry of Industry and Trade- says: "Today the subject is raised again, especially in the domain of IT. In fact, the EU, Canada, and the U.S.A attract experts from abroad by all means because these countries need hundreds of thousands of experts to build what is called the new economy, an economy that is based on high-tech.
Professor Khalid ElHariry –The president of the Moroccan Federation of Information Technology, Telecommunications and Offshoring (Apebi) - says that: "since 1999, the number of Moroccan immigrants abroad noticeably increased, especially computer engineers. For example, 60% of the students who graduated from The Moroccan National Institute of Posts and Telecommunications in 2000 left Morocco, and there are others that are ready to join their colleagues. The phenomenon is not less dangerous among the students who graduated from National School of Computer Science and Systems Analysis… Recently, during our seminar about the subject in Mohammadia Engineering School, an opinion poll that we made inside the hall revealed that 80% of the engineering students expressed their desire of migrating immediately after graduating". Pr. ElHariry noticed that "this phenomenon does not only include the jobless engineers, but also specialists from different fields who work in the private and public sector.”
Some statistics show that each year the Moroccan educational system does not produce more than 200 engineers, while the needs of Moroccan business are of 800 engineers. In other words, the Moroccan schools of engineering have difficulties covering the internal need of our country. So, how could Morocco handle that if European and American countries adopt the graduated students once they get their diplomas?
On the international level, the need of IT engineers is more persistent. EU needs 1.2 million engineers in the five coming years, while the U.S. needs 750,000 engineers every year. This urgent need of IT engineers pushed the countries in need (especially France, Germany, Canada and the U.S.) to facilitate the immigration procedures for the targeted one. According to unofficial statistics these facilities led to a weekly departure of 200 engineers to abroad. Pr. Rebbah emphasizes: “these migration facilities made public institutions, banks, construction and even specialized companies, lose their experts every days…And by the end of the year 2000, Morocco may have had lost half of its experts.”

Causes of the drain

Globalization
Globalization is considered as the most important cause of brain drain, and that’s because globalization encourages technological advances, open borders and reduced distances. According to Dr. Mostafa Zaoui –Research Professor at the Faculty of Sciences in Rabat and President of the Office of the State Secretary in scientific research- “Brain drain is not a national phenomenon as much as it is a universal one, and its effect grew since the collapse of the socialist camp and the large displacement of the human resources and competencies upper East Europe in the early nineties. The other factor that encouraged the fostering of brain drain is the increasing need of developed countries of experts in the new strategic disciplines, such as communication technologies and biotechnology.”
Dr. Abd Rahman Fouladi –a Moroccan expert that left the country to Canada to teach in a Canadian university- feels that: “Migration is a solution in a world where the geographical boundaries lost its meaning because of globalization.” He explains the phenomenon of brain migration by the fact “The young Moroccan population exceeds the real capacity of Morocco to accommodate it. For this reason, it is normal that Morocco has a surplus in cultural energies.”
Dr. Zaoui confirms: “the reason behind the outbreak of the phenomenon of migration among scientists and middle and higher technicians, is essentially the gap between the supply and demand on these strategic specialties in developed societies, which made occidental governments adopt strategies of attracting and bringing in these competencies. After all, brain migration is a reaction to the lack of appeal of the production systems of developing countries, and the competitive strength of their counterparts in Western countries.”

Discouraging working conditions
The followers and Activists of this phenomenon agree that the poor working conditions in Morocco don’t encourage scientists to create and shine, constrain their activities and prevent them from taking initiatives. In addition, the political and economic crises worsen the situation. According to Pr. Rebbah: “The weakness in the orientation and supervision, the absence of the appropriate conditions to embrace and encourage these competences, and the weak incentives and financial compensations are the main reasons why these future experts leave the country.”
Pr. Mohammed Chaoui –President of Moroccan National School of Computer Science and Systems Analysis – explains more clearly: “the reasons for brain drain are the non-response of working conditions in the field of communication and technology to the expectations of the youth who graduated in this field. These young engineers look forward to working in an environment that helps them create. However, the conditions of work in Morocco don’t encourage creativity, the means of working are old and the structure is poorly organized.”
Dr. Chaoui links this situation to “the absence of continuous training, especially that the field of communication and technology is constantly renewed.” He adds to that: “Loss of confidence in the country is the main reason. Many of those who immigrated, especially the ones who immigrated to Canada to get its nationality, have lost all hope of reform in Morocco. In addition, we have political problems in our country, especially what is in concern with individual freedom. The low salaries remain a secondary reason because the cost of life is so low as well.”
Nevertheless, Pr. Mohammed Ben Chaaboune, Director of department of information system in the Central Popular Bank, sees that the low salaries and compensations are the major causes of brain drains. He says: “The offered wages to our brains abroad are 2.5 times higher than the ones offered to them in Morocco. The encouraging and tempting conditions of life in Europe make our experts dream of living in Europe. These conditions are not just related to wages and compensations, but also with the encouraging working environment, the importance of the projects, the use of latest technologies, and the trainings that are offered.”
Pr. Abd Rahman Fouladi –Professor in a Canadian university- agrees with what was said by Pr. Mohammed Benchaaboun, and adds: “we should not forget that Moroccan experts don’t find positions in their country that take full advantage of their level of expertise. Add to that there are no investments in the field of technology that is need of the expertise and specialization of these experts.”
Pr. Khalid ElHariri summarizes the causes of brain drain in three points:
·        Financial reasons: they include wages and compensations compared to the cost of life in Morocco, because there is a set of necessities imposed by the nature of the job of an engineer. For example, adequate housing, convenient means of transportation, means of entertainment and smart phones.
·        Working conditions: the engineers and experts find themselves surrounded by restrictions and red tape. In addition, they are not treated appropriately, and the working conditions are not encouraging, which hinder and cripple their creative abilities. 
·        Social environment: Young people don’t trust their country anymore, and have lost any hope of change to occur. They no longer just think about their future, but also about the future of their kids, which make them prefer immigrating to countries that recognize human rights and respect the rules of life and work.

What can be done?

It is clear that the situation is so dangerous, especially given that Morocco’s capital is its human resources and its creative brains. We saw through the preceding that brain drain makes us move backwards despite exploring future prospects and following the path of the scientific progress.
So, what should the Moroccan government do in order to stop brain drain? And how can Morocco best use its energies and expertise no matter if they leave or stay in the country?
All the experts and activists in the field of technology and new economy agree about that the following actions are effective to overcome the crisis and get rid of the effect of brain drain.
·        Increase the number of graduating students by a rate that responds to the national and international demand. In fact, Morocco produces 200 to 240 engineers every year, while this number has to increase to 2000 each year. Morocco has to produce a total of 10,000 experts in different fields as well.
·        Rely on complementary and transformative trainings, and that’s by subjecting the recently graduated students and the youth that couldn’t find a job to trainings that turn their interest and energies to the fields of computer science.
·        Improve the existing institutes and create new ones.
·        Encourage institutes from the private sector.
·        Revise the system of wages and compensations and give priority to technology in public institutions.
·        Reconsider the working terms and conditions in our country, and make them more attractive and more convenient. 
·        Create channels of partnership between national and foreign countries.
·        Benefit from the Moroccan experts that are abroad by creating means of keeping in touch with them (networks, websites, annual forums in Morocco and the hosting countries…etc.)
·        Create in the Moroccan embassy new job opportunities that deal with the new economy and IT.
·        Encourage the Moroccan experts who invest abroad or have senior positions in multinationals to invest in Morocco.

Source of the article: 

http://www.angelfire.com/bc2/walid98/admira.html