Morocco is eager to lure more foreign investors from Europe and the Arab Gulf region to help it modernise its agriculture as it prepares to lease more state-owned farms, a farm official said on Friday. The government leased a first batch of state-owned farms to 173 investors, some of them foreigners, last year.
The first offer of 45,000 hectares attracted 4.7 billion Moroccan dirhams ($539.8 million). The success of the first tranche encouraged the government to expand the lease operation to a second batch of more than 50,000 hectares as it targets larger foreign investors, especially from southern Europe and the Arab Gulf.
"I think the tender to lease the farms in the second tranche will likely be launched next month," Ahmed Hajjaji, chairman of the state farm supervisor Sodea, told Reuters.
Government ministers, including Finance and Privatisation Minister Fathallah Oualalou, had repeatedly complained that agriculture was lagging behind other sectors of the $52 billion economy. Most Moroccan farms out of a total area of 8 million hectares are divided into small lots of 5 hectares on average.
Less than 12 percent of farms are irrigated, with few equipped with tractors or receiving fertiliser. Morocco's agriculture is dependent on the weather and output swings sharply because of cyclical drought. "The offer of the second tranche involves a wide range of options, including big farms of 2,000 hectares," said Hajjaji, adding that the holdings included crops ranging from wheat to olives and citrus.
The farms to be leased and those already leased were scattered across the country and the presence of foreign investors with new technology and modern management was expected to inspire other farmers to modernise. Hajjaji said interested investors included French, Spaniards, Portuguese as well as some from the Arab Gulf region, alongside Moroccans.
Hajjaji said the newly created investment fund Olea was interested in leasing farms. A banking consortium, including two subsidiaries of French Societe Generale, has set up the Olea investment fund to grow olive trees and produce high quality olive oil in Morocco.
The fund plans to invest 1.8 billion dirhams to create 10 olive farming units of 1,000 hectares each to produce 30,000 tonnes of high quality extra-virgin olive oil per year.
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