Kellogg School of Management at Northwestern University

“Morocco is a country that would be described as an emerging market, even a frontier market,” says Russell Walker, a clinical associate professor of managerial economics and decision sciences at the Kellogg School. The nation’s GDP is relatively low—approximately $3,300 per capita according to the World Bank—but its economy is poised to grow. According to Walker, the business community should take note.

At the invitation of the US State Department, Walker recently traveled to Morocco to speak with various groups of business leaders. “Young, vibrant—it’s only been fifty or sixty years since they achieved their independence from France,” he says. He left the North African nation optimistic about where its economy is headed—so much so that he’s encouraging his students to partner up with Moroccan business leaders, particularly Moroccan entrepreneurs interested in thinking big.

Russell Walker speaking to business leaders in Morocco.

“There are still millions of people in Morocco whose GDP and personal affluence are low, and the ability to create a product or transform their lives is very high [for] entrepreneurs,” he says. “It’s in the spirit of what Kellogg establishes and what it aspires to. And here’s a tactical place where that can be done.”

There are, of course, risks to entering the Moroccan market or investing in Moroccan businesses. “Their business [and] banking climates in particular have not established the institutions that we rely upon for making lending decisions,” explains Walker. Credit bureaus and rating agencies are missing, as is transparency in the reporting of loan documents. “There’s maybe an element of apprehension to full disclosure of financials,” says Walker, citing the nation’s history as a potential cause. “And of course that is contradictory to the principles of economics. If we want to establish efficient markets for lending and risk management, we need flows of information.”

But, Walker believes, Morocco’s unique strengths should in the end outweigh its weaknesses:

1. Infrastructure and Resources
The country has made tremendous investments in infrastructure—“ports and airports and highways that are probably better than some of the ones here in Chicago,” says Walker. Morocco has also invested heavily in solar and other sustainable energies. Add these investments to Morocco’s natural resources (the nation is one of the largest producers of phosphates) and a government committed to further investments, and you have the groundwork for rapid economic expansion.

2. Location, Location, Location
“If you think about where the world is going to be in 50 or a 100 years, the largest population centers will be in west Africa,” says Walker. With one coast along the Atlantic Ocean and a second along the Mediterranean sea, Morocco bridges—culturally, logistically—west Africa and Europe.

3. Multilingualism
French and Arabic are spoken in Morocco, and a growing number of Moroccans are obtaining fluency in English as well. When it comes to outsourcing products, these language skills provide the nation with “an opportunity to service many parts of the world,” says Walker.

4. Tourism
Tourism is already an important industry in Morocco. The country “has a very interesting story to tell,” says Walker—and once it makes its story known, the tourism dollars could flow even more generously. “You know what you’d go see if you went to India,” he reasons. “You’d go see Taj Mahal—something iconic.” Morocco has similar cultural riches, but at least among most North Americans, they are far less well-known.

5. Entrepreneurial Spirit
Walker noted a “tremendous amount of creativity” among business leaders and entrepreneurs in Morocco. “This is in some ways typical of emerging markets. If there’s a lack of resources, then the mother of invention is creativity,” he says. One company, for instance, is making new luxury skincare products from cactus seed oil.

Editor's note: Top image courtesy of TreasuryTag at en.Wikipedia. Bottom image courtesy of Russell Walker.

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