EU trade relations with Morocco. Facts, figures and latest developments.
Trade and investment relations between the EU and Morocco are important: the EU is Morocco’s leading trade partner, and alongside Algeria, Morocco is the EU’s biggest trade partner among the Southern Neighbourhood countries (which also include Egypt, Israel, Jordan, Lebanon, Libya, Palestine*, Syria and Tunisia). The EU is also the biggest foreign investor in Morocco.
The EU and Morocco established a Free Trade Area as part of the EU-Morocco Association Agreement, signed in 1996, which entered into force on 1 March 2000. The EU and Morocco also signed an Agreement on additional liberalisation of trade in agricultural products, processed agricultural products, and fish and fisheries products, which entered into force in October 2012.
Trade in industrial products is entirely liberalised, while market opening for agricultural products is also substantial. Both parties agreed upon a protocol establishing a Dispute Settlement Mechanism, which entered into force in 2012.
Negotiations for a Deep and Comprehensive Free Trade Area (DCFTA) started in 2013. A Sustainability Impact Assessment carried out by an independent contractor accompanied the launch of negotiations. The last negotiating round was held in April 2014, after which negotiations were put on hold at Morocco’s request.
An Amendment of the protocols of the EU-Morocco Association Agreement, which extended the tariff preferences laid down in the Association Agreement to products originating in Western Sahara, entered into force on 19 July 2019. In December 2020, the European Commission published a Staff Working Document on the implementation of the agreement. The report demonstrated that the agreement is being implemented smoothly and that it is delivering benefits for Western Sahara and its population in terms of exports, economic activity and employment.
In 2021, under the new EU Trade Policy Review, the EU has offered to discuss modernising trade and investment relations with Morocco, to better adapt them to today’s challenges.
The impact of the trade component of the EU's Euro-Mediterranean Association Agreement with Morocco was assessed by the ex-post evaluation of the trade chapters of the six Euro-Mediterranean Association Agreements (Algeria, Egypt, Jordan, Lebanon, Morocco and Tunisia), which was published by the European Commission in 2021.
The EU established its privileged partnership with the Eastern and Southern shores of the Mediterranean back in 1995 with the launch of the Euro-Mediterranean Partnership at the Barcelona Conference, aiming to establish an area of peace, stability and economic prosperity that upholds democratic values and human rights.
The 25 th anniversary of the Barcelona Process in November 2020 was an opportunity to reflect on the strategic partnership with the region in light of the political, socioeconomic, financial and environmental challenges exacerbated by the Covid-19 pandemic, and to reassess the EU’s partnership with Morocco and the other Southern Neighbourhood partner countries. Following consultations with partners, this reflection resulted in a Joint Communication by the European Commission and the High Representative of the Union for Foreign Affairs and Security Policy on ‘A renewed partnership with the Southern Neighbourhood – A new Agenda for the Mediterranean’ and the annexed ‘Economic and Investment Plan for the Southern Neighbours’ in February 2021.
In addition to the Euro-Mediterranean Partnership, in 2004 Morocco signed the Agadir Agreement with Jordan, Egypt and Tunisia. The agreement committed all parties to removing all tariffs on trade between them and to harmonise their legislation with regard to standards and customs procedures. The Agadir Agreement entered into force in July 2006, and an Agadir Technical Unit in Amman ensures its implementation. Lebanon and Palestine joined the agreement in 2020.
The pan-Euro-Mediterranean cumulation system of origin was created in 2005. It brings together the EU, Morocco, and other partners in Europe and the Mediterranean to support regional integration by creating a common system of rules of origin. Rules of origin are technical criteria which determine whether a specific product qualifies for duty-free or other preferential access under a given trade agreement.
Cumulation of origin means a product coming from one partner country can be processed or added to a product of a second partner country and still be considered an ‘originating product’ of that second partner country for the purposes of a particular trade agreement.
The pan-Euro-Mediterranean system allows for diagonal cumulation (i.e. cumulation between two or more countries) between the EU, EFTA countries, Turkey, the Western Balkans, the Faroe Islands, Ukraine, Moldova, Georgia and any country that signed the Barcelona Declaration of 1995. The system was originally based on a network of Free Trade Agreements with identical origin protocols.
These individual origin protocols are being progressively replaced by a reference to the Regional Convention on pan-Euro-Mediterranean preferential rules of origin (PEM Convention), which was established in 2011 to provide a more unified framework for origin protocols. Morocco acceded to the Regional Convention on 18 April 2012.
The EU and Morocco meet regularly to discuss issues and best practices and oversee the proper functioning of the Agreement.
* This designation shall not be construed as recognition of a State of Palestine and is without prejudice to the individual positions of the Member States on this issue.
