Unlike some of its North African neighbors, Morocco is not known for its petroleum reserves. But here, there is another type of oil that seems to have attracted the world’s attention these days. Deep inside the country’s southwestern desert lies a herbal oil extracted from the seed of a thorny tree. Argan oil, which gets its name from the Arganier tree, is said to work wonders on thirsty dry skin, and now is being sought after by the beauty-conscious men and women across far-flung continents. This beauty potion has given a total makeover to the lives of rural Moroccan women who harvest the oil in a labor-intensive process. In a way, the story is symbolic of a resurgent nation, which is slowly emerging on the radar screens of foreign investors.
From ancient times, the people of Morocco have prized this delicate oil, which sprinkled liberally has added a touch of taste to their daily bread or couscous or pasta. Locals have also valued the medicinal and health benefits of this magic oil, and the French got a whiff of it, thanks to the close ties between the two nations.
A Wall Street Journal report points out that it was perfume maker Fragonard who first spotted the potential of Argan oil, now known to be nutrient-rich in vitamin E and omega-6 fatty acids, both coveted anti-inflammatory agents. Close on the heels of Fragonard, French cosmetics behemoth L’Oreal soon followed suit by blending the nice light oil to make its wide array of beauty products. Now, the aroma of the golden-colored oil has literally emanated throughout the globe, riding the wave of its beauty-enhancing and therapeutic properties. The WSJ further explains that companies in the beauty business were smart enough to cash in on the prospects of this miracle oil, so much so that Argan oil is an ingredient in not less than 111 personal-care products launched in the United States alone last year, leapfrogging from just two in 2007. Both L’Oreal and Miami-based Amal Oils LLC procure the oil from cooperatives run by the tribal Moroccan women, which in turn helps their impoverished families get better education and healthcare.
Like the indigenous oil it produces, Morocco is seemingly casting its magic spell on investors in sectors as diverse as hospitality, pharma, banking, dairy, and fertilizer manufacturing. The tourism hot spot of Marrakech is witnessing a boom in the construction of luxury hotel buildings by the likes of India’s Tata Group, the Hyatt group, and Italy’s Baglioni Hotels. The country’s pharmaceutical sector — the fourth-largest in the MENA region – got a shot in the arm as Jordanian drug manufacturer Hikma Pharmaceuticals snapped up the home-grown Promopharm. In banking, AWB, the largest Moroccan bank by assets, has been on a buying spree for more than a year now, acquiring a majority stake in Cameroon’s Societe Camerounaise de Banque as well as the assets of Credit Agricole in western Africa.
The dairy products industry also seems to be boiling over with lots of interest pouring in from across the borders. While French food company Danone upped its stake in its Moroccan partner, Swiss group Nestle has said it will invest about $5.7 million in the sector, in partnership with the agriculture department. The deals notwithstanding, Morocco has always been known for its rich reserves of phosphates. The vital ingredient used in manufacturing fertilizers accounts for one-third of the country’s exports. The phosphate mining sector recently received a $250 million loan from the African Development Bank, a timely boost for the country’s flagship industry.
The Moroccan economy managed to weather the turbulent Arab Spring, which overthrew many oppressive regimes in its neighborhood, thanks to some largesse doled out by the King and amendments made to the country’s Constitution. And the country’s geographical proximity to both the Gulf countries and Europe has made Morocco a favorite tourist destination for backpackers, especially from France. Still, the Euro-zone crisis seems to have caught the country off guard, prompting the premier Abdelilah Benkirane to warm up to the Gulf Cooperation Council.
Rooted in tradition, yet modern in outlook, that is Morocco’s economy in a nutshell. Exuding an old-world charm, Morocco has revealed the time-honored secrets of a tiny Argan kernel, and the potential of yet another emerging marketplace.
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