King Mohammed VI has always been well aware of his country’s tourist potential. The Plan Azur 2010 and it’s follow up Plan Azur 2020 is a clear exponent of his dedication to the cause. We have seen considerable success and a vast improvement in general infrastructure around the major macro projects planned for the Atlantic and Mediterranean Coast. One such project is “Mediterrania-Saïdia” all 7MM Square Kilometres of it. Unfortunately the Global Financial Crisis and the unsettling events in the Arab World have slowed down its development. Nevertheless the announced improvement in the economy coupled with Morocco’s solid stability within the Arab World should shed some light into such wonderful prospects. For this blogger, he would like to see some further movements around the Al Hoceima area where the beaches and the environments are ripe for development. We have already seen the building of an excellent road from Nador/Saïdia (part of the Plan Azur) and its port and airport are a stone’s throw from the Southern Coast of Spain and of course, the Costa del Sol.
The World Bank under its “Doing Business” heading publishes very interesting data as to the efficiency of Judicial Systems worldwide in terms of quality, cost and time. The report covers 185 countries.
Below are the figures for Morocco regarding the enforcement of commercial contracts that naturally also include Real Estate. The percentages include Rank (in comparison to other countries) and cost and time measured from the time the plaintiff files the law suit until payment is received. The most recent data was collected in June 2012.
I have also included figures for the UK to give readers a comparative idea.
Time (In Days):
- Filing & Service,
- Trial & Judgement,
- Enforcement of Judgement
Morocco: 510 Days
United Kingdom: 399 Days
Cost (% of Claim):
- Lawyer Cost
- Court Cost & Taxes
- Enforcement Cost
Morocco: 25.2 %
United Kingdom: 25.9 %
Morocco: Rank 88
United Kingdom: Rank 21
Mar Chica Med
The macro project to be developed around the shores of Mar Chica in the Nador Province of North East Morocco. It is expected for the project to be finished and operating by 2025. The question we all ask is… Is this going to be another Mediterrania Saïdia? In any case it is designed to raise the level of prosperity in the area and counterbalance the differences with the neighbouring Spanish Enclave of Melilla, just a few Kilometres to the north. At present, crisis notwithstanding, the Spanish city still provides a lifeline to it’s long suffering hinterland.
A few kilometres south of the Spanish enclave of Melilla is what locals call “La Mar Chica” (The little Sea) a salt water lagoon about 25 kilometres long and covering an area of 4000 hectares. It has a semicircular shape only 8 metres deep separated from the Mediterranean by a narrow sand strip of about the same length with an estuary in the middle of about 120 metres.
There are plans to develop the area around it including the sand strip culminating in 2025. It will create 7 cities with all the facilities and will no doubt rival Mediterrania-Saïdia the macro complex 80 Km to the east.
Watch this space.
Foreign buyers in Morocco react very timidly when they face a problem with their developer and their lost dream and investment. It’s also interesting how the different nationalities react. By far the least aggressive are British and Irish buyers who trust goodwill and think that by appealing to fairness they are going to get joy. Nothing furthest from the truth I am afraid. How many cancellation letters have been issued? And how many refunds have been made?
Experts say that one of the main components in explaining why rich countries are rich and poor ones poor is culture and I would agree. A famed Moroccan proverb says that “A Christian is a cow to be milked” and precisely this is one of the reasons why the country have been unable to consolidate their share on International Property Demand that promised considerably at first.
To cut a long story short and in a nutshell the only way people are going to get their money back from these sometimes unscrupulous developers whether foreign or Moroccan is to get a judge to force them to do so.
There are two types of potential cases against a developer:
1. If a developer has not yet gone bankrupt they can be sued for breach of contract and can be done due non delivery within a reasonable time or for poor finishing.
2. With bankrupted developers the only possibility is to place a lien (preventive embargo) on the assets of the company before they are unwound or confiscated. The private contracts are not robust enough to secure the owner protection if this is the case. These are the kind of developers that are eternally looking for finance to finish off building works but they may be sitting on a time bomb that threaten to destroy them and what’s worse, their clients.
In my experience many buyers are very reluctant to take a developer to court and I would understand this. They have already spent a lot of money in return for nothing; they don’t trust lawyers who are in many cases accused of scaremongering for their own gains; or maybe that taking people to court in their own countries is a very drastic act and something you would do in the last resort. But the most relevant is that they still believe in the goodwill on the part of the developer. Forget it.
The pattern repeats itself, unfinished developments or poor quality finish is sadly a common occurrence in many developments. In many cases the promoters and most of their clients were foreign. Some have disappeared outright and others are in the eternal path of seeking finance. Meanwhile the years go by a nothing happens leaving their long suffering buyers without their deposits and their property.
The web is full of stories of those foreign buyers telling of their unfinished Moroccan Property they bought off plan and paying a hefty deposit that are now seeking the possibility of organizing Group Action. A number of different groups have been set up and appeals constantly being made to embassies, consuls, government and even the King! Some British buyers have even written to their MP’s. Likewise, some lawyers have tried to persuade individuals to join up and take joint legal action.
This is very coherent in the west but in Morocco it simply doesn’t work, and those clever lawyers should know this. It is not only Moroccan Developers that are ignoring their buyers; some of the worst culprits are Foreign. Under the cover of a western professional approach they gain time by telling clients that they looking to raise funds by negotiating with a big fish developer or just at the point of a signing a deal with this or that Bank. At the end of the day reality is faced and building work remains as it is, unfinished.
I suppose that the difference between Moroccan and (some) Foreign developers is communication. It must be cultural thing but many Moroccan businesses will simply ignore you when they have to provide a service or fulfill their commitments. Not exactly take the money and run but the feeling is that once they get their proceeds they are just not interested. In Morocco you will get an excellent service if there is something in for them short term, however, things change when the gains are long term and specially if there is work involved. Again, I’m not generalizing but the tendency is there.
Also sensibilities are different too and the feedback of those that have appealed to embassies, etc, is that they will lend a sympathetic ear but that’s about it. It has always been my feeling that the King isn’t really being informed of the finer points of this public image exercise for his country. I’m sure that if he ever knew something would be definitely done about the problem with a few heads rolling in the process.