Morocco: Morocco Tourism Profile 2012
Morocco Tourism Profile
Travel and Tourism in Morocco
According to the majority recent data available from the Ministry of Tourism, for H111, a total of 4,202,241 tourists visited Morocco in the first months of 2011, an increase of 6.3% y-o-y. This increase occurred even against a backdrop of unrest across the Middle East and North African, marked by regime change in Tunisia, Libya and Egypt, and with Morocco as well experiencing a short-lived outbreak of violence in February 2011. Tourists were as well seemingly not been deterred by the suicide bomb attack on a popular tourist café in Marrakech in April 2011 that killed 16 people.
Given the strong H111 figures, our base-case scenario is for another positive year for inbound tourism in 2011, with an increase of 8% in arrivals likely, although we stress that this is dependent on the November 25 2011 elections passing relatively peacefully. Tourist arrivals should surpass the 10mn mark for 2011 as a whole.
Supporting Moroccan tourism in the years ahead are the national Vision 2020 strategy (see below) and the ongoing Plan Azur resort development programme. By the end of our newly extended estimate period in 2016, we believe Morocco will be welcoming over 14mn tourists and earning about US$8.8bn in annual tourism revenue. However, another attack in Marrakech or an increase in domestic political unrest could act as a downside risk to these figures.
A Country With Long-Term Tourism Potential
Foreign investment continues to flood into Morocco’s tourism sector. A lot of international hotel chains continue to build new resorts across the country and the development of the Mediterranean coast should prove a particular draw to investors wishing to gain exposure to the tourism and property sectors. Foreign airlines are adding new routes to the country and the strong priority given to tourism by the government is another supportive factor.
Some golf and beach properties under construction in Morocco rival those in nearby Spain but cost much less to purchase. Morocco’s proximity to Europe - with flight times from the UK to the Mediterranean coast of about three hours on low-cost carriers - and its reputation as a fairly progressive and democratic Islamic country are pluses for investors considering Moroccan tourism.
Taking into account the country’s high level of literacy and the government’s commitment to improving training standards across the hospitality industry, BMI believes amount the ingredients are there for Morocco’s tourism industry to continue to make great strides in the years approaching.
Royal Air Maroc Looking To Cut Costs Despite the upbeat outlook for the wider tourism sector, Moroccan flag carrier Royal Air Maroc remains in fairly dire financial straits at the time of writing, with media reports indicating that the airline is losing about MAD80mn per month because of high staff and fuel costs and the political uncertainty across North Africa.
The airline is carrying out a rationalisation programme to cut costs and boost profitability. In August 2011, union workers approved a wide package of measures, which included refocusing the company’s operations at its Casablanca hub, the sale of 10 aircraft and reducing staff by about 1,560 people between 2011 and 2013. In early September 2011, the airline said 535 people had already applied for voluntary redundancy.
Morocco is at a crossroads between the East and the West, both culturally and geographically. Historically, its proximity to Europe has meant that a lot of nations in Europe are key source markets for Morocco’s tourism, starting with France, which has had a longstanding political presence in Morocco. From now on during the economic downturn in 2009, having Europe as a source market proved detrimental to tourism receipts and spending. Morocco has since then, and even somewhat before the crisis, started looking at additional lucrative source markets such as Gulf Cooperation Council (GCC) nations, and this may prove beneficial during the estimate period. And currently, new challenges stemming from Morocco’s location in the Middle East and North Africa (MENA) amidst a tormented region are as well arising.
Fast-moving air transportation
Since 2006, Morocco has liberalised its air transportation, which led to the market entry of several low cost carriers including easyJet, Ryanair, Jet4U and Atlas Blue – not to mention Air Arabia, which established a hub in Morocco. This has meant new opportunities to expand the tourism industry, but as well introduced a key challenge to major Moroccan corporation, Royal Air Maroc. The company bought Atlas Blue in a failed attempt to have its own LCC arm, and is now planning to purchase Jet4U in order to make things right and compete entirely in this market.
Targeting luxury, from now on serving budget
Morocco is being targeted by a myriad of world investors for the development of its travel accommodation. A vast majority of the new and upcoming supply of hotels is expected to be in the 4- and 5-star category, thus boosting the country’s luxury infrastructure. Nonetheless, with the expansion of low cost airlines and hence the potentially growing budget market, there are opportunities for amount to take chance of the increase that is taking place. Whilst luxury operators may start to look at a new clientele, budget operators may want to target European tourists – still suffering from the impact of the slowdown.
Becoming a spa destination
In recent years, Morocco has moved towards a positioning as a spa destination, having added a number of new resort and hotel spas amongst which is the world-famous Senses, which came to Baglioni in Marrakech. Morocco as well has an Angsana spa and a large number of international hotel chains amount having their own spas as well. This country has a history of therapeutic know-how, notably with thalassotherapy, and this has facilitated the task of positioning Morocco as a spa destination. There are a large number of projects in the pipeline including spas and it is likely that Morocco will succeed in this arena as it is as well competitively priced compared to other notable spa destinations such as Dubai in the Arab world or the Czech Republic in Europe.
Defying expectations in tourism
The Moroccan tourism industry posted strong increase in 2010, and figures for early 2011 point to another bumper year. Confidence remains high despite the April bombing of a café in Marrakech – the effect of which appears to have been limited – and ongoing regional instability, and the government continues to roll out ambitious plans for the decade ahead.
Visitor numbers have increased each year in the past decade, and tourist arrivals to Morocco reached 9.3m for the year as a whole in 2010, up a strong 11.5% on 2009 figures of 8.34m, according to the Ministry of Tourism. Nights spent in the country were as well well up, by 11% year-on-time(y-o-y), as were room occupation rates, from 41% in 2009 to 44% last year. The bottom-line indicator for the sector, tourism receipts, grew by a healthy 6% on the previous year, to Dh56.2bn (€4.96bn), although it is worth pointing out that revenues declined in 2009 amidst the lingering effects of the world economic slowdown.
This year is as well off to a strong start, with amount major indicators again showing healthy increase. Despite a dip in March, tourist arrivals increased 6% y-o-y in the first quarter of 2011, to 1.83m. Arrivals in April were up 18% y-o-y, to 784,000. Nights spent in hotels in the first quarter as well grew, from 3.76m in first-quarter 2010 to 4.01m in first-quarter 2011, a y-o-y rise of 7%, which helped boost occupancy rates by %age points, to 41%. Total tourism receipts for January, February and March increased by 6.7% y-o-y, to Dh11.1bn (€980.2m).
Although the April 28th bombing in Marrakech, Morocco’s biggest destination in terms of room nights, happened relatively recently, as of late May only 22,000 nights worth of bookings in Marrakech for May, June and July, or 5% of the total for the three-month period, had been cancelled, local media reported. French tour operators as well reported little in the way of cancellations following the bombing. Local business representatives regard this number as relatively small and encouraging, having feared a significantly worse effect.
Furthermore, the Moroccan tourism sector recovered quickly after the only previous major terrorist attack in the country, the May 2003 Casablanca bombings – arrival numbers for 2003 as a whole increased 15% on 2002. It was the same in other regional markets in the mid-2000s such as Turkey and Egypt, despite the sustained campaigns of attacks against the industry, giving cause for optimism that any effect in Morocco will similarly be short-lived. Tourism minister Yassir Znagui in May told media he believed that a strong 8% increase on tourism receipts for the year as a whole is possible based on results registered to date.
This optimism is bolstered by the increasing diversity in the sector’s offering. While Morocco in the past may have been better associated with budget travellers and backpacking, the luxury and golf tourism market in the country continues to expand. For example, French hospitality company Accor opened its 147-room Sofitel Essaouira Mogador Golf and Spa property near Essaouira on the Atlantic coast in March, bringing its total number of hotels in the kingdom to 30. The resort as well contains 28 villas and is part of the Mogador eco-resort, which will feature 18-hole golf courses designed by Gary Player. At the other end of the market, Accor as well opened a second Ibis-brand property in Tangier in January.
Similarly, Spanish hotel chain RIU opened properties in the country in May, comprising a 462-room resort in Agadir and a 54-room boutique golf hotel in Marrakech that is part of the company’s RIU Grand Palace range of luxury properties. The openings bring the number of RIU hotels in Morocco to, with plans to open an additional – the RIU Palace Agadir – towards the end of the year.
Despite ongoing success and expansion in the market, the government is leaving nothing to luck and is continuing with its Tourism 2020 plan, following on from the success of the previous Tourism 2010 initiative. The plan envisages Dh177bn (€15.62bn) worth of investment in the sector between now and 2020, of which the government will provide Dh32bn (€2.8bn), including a Dh15bn (€1.32bn) national-backed tourism development fund.
The initiative includes plans to open facilities in each region of the country in order to train 132,000 young people to work in the sector, to construct at least new major museums, to renovate numerous historical monuments, to open several new beach resorts – notably at Aghroud, north of the established resort town of Agadir – and to provide at least another 200,000 tourism beds in the sector, doubling current capacity. Through these measures the government aims to additional than double arrivals numbers, to 20m, and to raise annual tourism receipts to Dh140bn (€12.36bn), generating an additional 470,000 jobs in the industry by 2020.
The number of arrivals grows in 2009 despite the worldwide slowdown
Government to launch Vision 2020 in 2010
French visitors still dominate but the tourist profile is slowly changing
Low cost flights taking-off
Moroccan hotels ready for tougher competition
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