Morocco to lease agricultural estates to private investors

23/04/2007

Morocco recently announced plans to lease 116 farms to private investors, in a bid to increase efficiency and productivity in key agricultural sectors.

By Mawassi Lahcen for Magharebia in Casablanca – 23/04/2007

[Mawassi Lahcen] Mohand Laenser during Friday's conference

Mohand Laenser, Morocco’s Minister of Farming, Rural Development and Fishing announced Friday (April 20th) on the sidelines of the International Farming Conference in Marrakech that the government will offer 116 state-owned farms to private investors. Laenser said the Moroccan government chose to lease these estates since Moroccan law does not currently permit the sale of the state’s agricultural holdings.

This new offer comes after the success of the country's first agricultural joint venture two years ago. That process made possible the leasing of 164 estates totalling 41,000 hectares. The portion of foreign investors leasing land in the first venture was 14%.

Laenser said that the government’s aim with the new leaseholds is to boost efficiency on estates were state companies have failed to manage them effectively. Many such farms accumulated considerable debt as a result of poor planning and declining profitability. Lessees will operate the farms under contract for periods ranging from 17 to 40 years in duration.

The process, according to Laenser, will differ based on the size of the plot. For the large, strategically significant estates, negotiations will be conducted directly with prospective investors. The smaller parcels of land will be offered up for competition in an international call for bids.

Laenser noted that the area subject to direct negotiations covers 25,800 hectares, encompassing 10 estates specialising in the production of citrus fruits, 9 estates specialising in the production of olives and 5 estates specialising in the production of select seeds. Laenser added that the government is endeavouring to keep the production specialities of these estates due to strategic considerations, especially in the case of estates that produce select seeds, pointing out that the production of these five estates meets 20% of Morocco’s needs for wheat seeds.

Laenser said the Moroccan government decided to leave the choice up to investors concerning the type of agricultural production they will undertake on the 92 estates of non-specialized land. "It’s true that the area of these estates, which amounts to 40,000 hectares, represents but a small portion of Morocco’s total agricultural areas, estimated at around 9 million hectares. But we want these estates to play a driving role in the Moroccan farming sector and to be exemplary and pioneering leaseholds on the technical level and the planning level," Laenser said. The official announcement of the call for bids took place on April 16th, and the government set September 12th as the deadline for receiving bids from investors interested in the venture.