Moroccan hotels feel euro-zone chill factor

Risma, the Moroccan affiliate of the French hotelier Accor, is already suffering adversely from the European debt crisis.

About 90 per cent of Morocco's tourists are from Europe, most of them from France.

The hotelier, which owns rights to Novotel, Ibis and Sofitel in the country, has already suffered a share price decline of about 20 per cent this year on the Casablanca Stock Exchange. The company expected to go into profit this year after breaking even last year, following a loss of Dh148.9 million in 2009 after the launch of a hotel in the capital of Rabat hurt the company's bottom line.

But Morocco's tourism sector, which accounts for 10 per cent of the country's economy and employs 450,000 people, has already shown signs of weakness.

Hotel and restaurant activity recorded a 3.8 per cent drop in the second quarter, its worst quarterly performance since the first quarter of 2009, according to data published by the country's central bank last month.

Just 15km across the Mediterranean Sea from Spain, the North African country conducts about 60 per cent of its trade with the EU, but the region's sovereign debt crisis is clouding its outlook.

"The impact on Morocco has not just hit tourism, but exports and remittances," said Sebastien Henin, a fund manager at The National Investor in Abu Dhabi. Exports of goods and services to the euro zone account for 15 per cent of the Moroccan GDP.

Remittances from Europe to Morocco could also see some pressure due to the crisis, Mr Henin said. About €4 billion to €5bn per year are remitted by Moroccans living abroad in Europe, he added.

To help to safeguard Morocco's economy, they asked in May to join the GCC.

"Although a five-year development has been announced as part of this, details are still sketchy," Capital Economics, a research house in London, said yesterday.

halsayegh@thenational.ae

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