Economic integration in the Maghreb

african institute for economic development and planning

dakar

economic integration in the maghreb

by

k.h. khalil

à

november, 1970

s4

IDEP/ET/2340

Page 1.

Contents

INTRODUCTION:

I Economie Characteristics of the Maghreb:

1 - Primary production and, exports:

a - Agriculture : - Place of Agriculture in the Maghreb Economies ^-

- Main agricultural and. related products :

- Similarity of agricultural products.

b - Mineral resources :

phosphates-Iron ore - Zinc and Lead - Energy.

2 - Low level of Industrialization -

3 ^- Small Inter-Maghreb Trade.

a - Trade in agricultural Products

b ^- Export of Minerals

c - Exports of manufactures

II - Approach to Economic Integration in the Maghreb

III - Maghreb Industrial Integration

1 - Integration Industries Based on Natural Resources : Fertilizer Industries - Zinc and Lead - Clay - Energy

2 - Integration Industries Based on Maghreb Local Demand.

a - National Industries : Food Industries - Textile Industry b - Integration Industries : Paper Industry - Iron and

Steel

Industry

Intermediate goods and metal products - metal, mechanical and engineering industries - Electronic industries.

3 - Unused "or underused" Industrial capacities.

IV - Some Guiding Principles in the Allocation of Industries

Between the Maghreb countries :

1 - A good understanding of the role of economic intégration»

2 - The distribution of gains, and losses. ^{.. .. .}

4

3 ^- Some other investment Policy issues.

4 ^- The Strategy of the development plans and the distribution of

industries between the Maghreb countries.

5 - Policies in olhei; sectors. ,

6 — The investments codes and fiscal and social policies,

V - The Development of Economic Co-operation between the Maghreb countries

1 - Economic co-operation before the proposed convention.

a - General principles of co-operation,

b ^- Co-operation of Transport

c - Trade arrangements.

2 - Proposed Convention for Maghreb Economic Co-operation 3 ^- Institutional Framework.

VI - Summary and conclusions Appendix I s Economic Data

Appendix II ; Industries in the National Development Plans of the Maghreb countries.

B - Bibliography : French English.

idep/et/2340

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INTRODUCTION

In this study an attempt is made to work out a scheme of integration

for the Maghreh countries. These include the traditional three countries

of the Maghreh i.e. Algeria, Morocco and Tunisia, as well as Lihya.

Although Libya failed to attend the last meetings of the council of

ministers in which the proposed convention was supposed to be discussed

and approved by the council, this study includes Libya as a member of the

group, because there is a possibility that she may join it. Moreover, Libya is a very interesting case in this scheme of integration. On the

one hand it is the least developed country of the group and on the other hand, it is a typical petroleum economy with a considerable amount of capital and with abundant oil and natural gas resources necessary for

industrialization and economic development in general.

In the first section of the study we find a review of the economic

characteristics and resources of the Maghreb countries. In the second

section the conventional economic theory of customs union is tested to

find out if that theory and the conventional forms of integration based

upon it,

(customs

-union, free trade area

etc)

^are relevant to the Maghreb

conditions. This section ends with an emphasis on industrial cooperation

as the most effective approach to integration in the Maghreb.

The third section deals with the industrial integration of the area, and selects some of the main industries where cooperation would be profit¬

able. The industries selected are divided into three categories: integra¬

tion industries based on natural resources those based on local demand and the cor-operation of industries to avoid idle capacity.

The fourth section discusses some guiding principles in the alloca¬

tion of industries between the Maghreb countries.

In the fifth and last section we expose the steps taken so far to establish the Maghreb Economic Community. These include economic co¬

operation before the proposed convention for integration, then analysis

of the convention, and finally, discussion of the institutional frame¬

work.

Economie Characteristics of the Maghreb

To work out a suitable scheme for economic integration in the Maghreb .a- review of the economic characteristics and resources of the Maghreb countries would be necessary. Conventional economics of integra¬

tion would be tested to find out if the theoretical analysis as well as the conventional forms of economic integration, such as the free trade

area, customs union, common market, etc are relevant to the Maghreb con¬

ditions.

The'Maghreb, in this scheme of integration, includes the three

traditional Maghreb countries, i.e., Morocco, Algeria, Tunisia, as well

as Libya.

1/

_1J

There ^{are some}

favourable conditions for the economic integration of

the Maghreb countries %

i ^- The Maghreb consists of four contiguous countries with the highest density in Africa

(except

South

Africa),

^and relatively well

developed road net-work.

Its natural resources are better known, and well studied than

any where else in the African continent. It is endowed with well

distributed mineral resources including natural gas, a necessary factor in industrial and agricultural development.

Close relations

(political,

economic and

geographical)

between

the Maghreb countries and Europe and the middle East.

iv - The historical, cultural, geographical and climatic similarities

between the four countries, and the determination to co-operate.

v - The Location of energy resources and mineral deposits near the

borders.

See : The opening statement by the executive Secretary of the ECA, in the Sub-Regional meeting on economic co-operation in Worth Africa,

E/CN. 14/HA/ECOP/l.

1 June

1966?

and see also,

e/cs. 14/NA/ECOI

May 1966.

ii -

iii -

idep/et/2340

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Total population of the area was about 33«7 million in 1967? of

which 13 million in Algeria; 14 million in Morocco;

4«8

million in

Tunisia and about 1.8 million in Libya. The rate of population growth

differs from one country to another: in Morocco, it was

2.6$

between 1958-66, but it was reported to be about 15 million in 1969 with a rate

of growth of

3.2$;

and it was

2.3$

for Tunisia in the same period. But

while it was somewhat low in Algeria:

2$,

it was as high•as

3.7$

in Libya between 1960 and 1967» A projection for the population shows that

the total population of the Maghreb will be about 35-7 million in 1970;

52 million in 1958 and 72.8 million in the year 2000

The Maghreb covers an area of 4?750,000

k2,

and thus accounts for

1/6

of Africa's area, and

1/10

of its population.

The Maghreb population is predominantly rural. lion-urban popula¬

tion varies from

63$

in Tunisia to

68$

in Algeria and

70$

in Morocco and Libya.

Other estimates for 1965 show that the rural population in Algeria

is

60$

of total population while it is

34$

in Libya,

72$

in Morocco and

57$

in Tunisia: see table 3 in the appendix.

3/

The main Economic Characteristics of Maghreb countries are that they are primary producers and exporters; that they produce and expor¬

ters; that they produce and export more or less the same primary products;

they have a low level of industrialization; and hence there is a very small amount of inter-Maghreb trade.

j/

These

figures

are taken

from Summary of Economic Data, EAC

2/ See

Le Grand

Maghreb Arabe, Committee Permanent Consultatif du Maghreb,

Tunis, March 1967 p12-13. The rate of growth according to this ^pro¬

jection is estimated at

3-1$

during the period

1965-70? 2.7$

during

the period 1970-75

(3$

for the period

1965-1975).

3/

ECA Sub-regional office,

Economic Survey of North Africa, part 1,

Tangier 1965.

I - Primary production and exports

We will be mainly concerned with agriculture and other related ^{^} primary products, then we shall discuss mineral resources.

A. Agriculture :

First we will look at the place of agriculture in the Maghreb

economies:

Land and Land use, GDP and value added by agriculture5 the relation

between agriculture and other sectors. Secondly, the main agricultural

and related items will be exposed. Thirdly, Trade in agricultural pro¬

ducts by the Maghreb countries either with the outside world or between each other will be examined.

1 - Place of agriculture in the Maghreb Economies

a. Land and Land Use :

The total area of the Maghreb countries is about 470 million hectar

I/

of which 384 million is non-arable land.—7 _Algeria-s area is about 238

million hectares, and Libya is about 1J6 million, while Morocco and Tunisia have an area of 41 and 1° million hectares respectively.

The pattern of land ^use in Morocco and Tunisia seems to favour a

higher proportion of agricultural land and land occupied by meadows and pastures than Algeria and Libya. Hon arable land accounts for about 981 80s ^{42 and}

31%

of the total area in Libya, Algeria, Morocco and

Tunisia respectively - agricultural land amounts to about 23.3$ 19*1s 3-4 and

1.4$

of total ^area in Tunisia, Morocco, Algeria and Libya respectively.

Algeria and Morocco rank at the top in terms of the areas occupied

with Alfa which covers an area of about 3 million in Algeria and 2.8

million hectares in Morocco, while it is 0.7 million hectares in Tunisia

iy

It is said to be about equal to that of Europe with area of about 493

million hectares of which about 174 million hectares of non arable land. See, EGA, Sub-regio'ol office, Tangier, Preliminary report,

"a comparative study of food production," by A.Z. SHEIEA, May I966.

idep/et/2340

Page 7.

and. 0.1 million hectares in Libya. Morocco has also the largest area of forested land which amounts to about 5*3 million hectares. Algeria

comes second with 2.4 million hectares and then Tunisia with 0.6 million hectares. Libya's forests are insignificant.

Total Agricultural land amounts to about 22.4 million hectares in all the Maghreb, of which

57«7$

for annual crops,

11.1$

for permanent

crops

(vineyard

and

orchards)

and

32.2$

for fallow. There are 8,7s8,4s7s

2.4 million hectares of agricultural land in Algeria, Morocco, Tunisia

and Libya respectively. The percentage of land occupied by annual crops to total agricultural land represents

4.1$

in Libya,

35*5$

in Algeria,

60.6$

in Morocco and

64.8$

in Tunisia. Land allocated to permanent crops is largest in Tunisia. It amounts to about 1.1 million hectares of 27.6.1

of total agricultural area. The percentage for Algeria, Morocco and Libya is

7-7$j 7.4$

and 6

respectively.^-/

b - GDP and value added in agriculture

In 1965? the total GDP was $2.716 million or $228 per capita in Algeria. In Libya it was $1.460 million or 912 per capita, while it was 2554 million and $960 million for Morocco and Tunisia respectively. The

per capita gross domestic product for these last two countries was 192 and 213 respectively. Gross domestic product for the whole Maghreb was

$7.690 million and in per capita terms it was $246.1 five exclude Libya

the capita GDP would drop to $210

(table ï)

Value added in agriculture in 1965 was

26$

of the GDP or $46 ^per

head of rural population in Algeria, and

5$

of GDP or $110 for Libya,

while it was

30$

or $43 in Morocco, and

20$

of the GDP or $67 for Tunisia.

Agriculture's value for the whole Maghreb was

23$

of the GDP

or'49$

Per head of rural population. With the exclusion of Libya the figures would be

27$

^{and $47.}

(Table 1).

JJ

Fallow land occupies more than one half of total agricultural land in Libya compared with 38.8 and

32$

in Algeria and Morocco respectively

while it is only J.6 in Tunisia. See Sheira op.cit. p.7

In 1967^s GDP was 13s620 million

dirham!/in

^{Morocco. In} the develop¬

ment plan 1968 ^- 1972 an increase of

4»3$

per annum in

GDP^/

^was aimed

at for bringing the total at 1964 prices to 14.489 million dirham in 1973 compared with an estimated 119770 million for 1968, at 1966 prices,

GDP in Tunisia has been accessed at 509,7 million

dinars^/for 1967» In

1969 a growth of

8%

in GDP ^was expected and the planned growth rate in

the third four _year plan was

6.5%

per annum. The Algerian GDP was about 15,760 million

dinars^/in

1967. In Libya GDP was 658.9 million Libyan

Pounds^/in

1967, at 1964 factor cost it increased by

16.9%

in 19665

'12.5$

in 1967 and was expected to increase by

16%

in

1968.

c - The relation between agriculture and other sectors

In 1965 "the other sectors of the Algerian economy supplied the agri¬

cultural sector with intermediate products to the value of $51m. of which

$7m. worth of fertilizers, or only $7 per head of rural population, while

in Libya the figures were 12, 1.5» 20 respectively. In Morocco the. total

intermediate supplies were $60m of which $7m worth of fertilizers, or as low as $6 per head of rural, population. The figures for Tunisia were

$27®, $4 and $11 respectively.

1/

These figures show the weak of inter¬

course between the other sectors of the Maghreb economies and the agri¬

cultural sector, especially the very low contribution of the fertilizers industry to agriculture in a region considered to be the third richest producer of phosphates in the world. The poor contribution of the other

sectors to agriculture can be seen from the very low figure concerning

the per head of rural population with an average of $8, and $7 if Libya

is excluded.

\] 5-06

dirham = 1 US dollar

2/ (La

production intérieur

brute).

3J

0.525 dinars = 1 US dollar

4J

4.937 Algerian dinars ⁼ 1 US dollar

5/

1 Libyan pound ⁼

2.80

US

6/

Total for the Maghreb is $150m, $20,

8

respectively.

IDEP/ET/2340

Page 9

Table 1 shows us also how the economy depends on the foreign market

for the intermediate products needed by agriculture. It represents

63^

of the total for each of Morocco and Tunisia, 66^o for Libya and

39%

i"0**

Algeria.

il

e - Low -productivity of agriculture

This weak contribution of the other sectors to the agricultural

sector so far as the latter's intermediate needs are concerned, has resulted in a very low productivity in agriculture. The industrial

sector has not developed sufficiently to supply agriculture, with the

necessary intermediate goods; i.e., fertilizer insecticides, agricultural machinery and equipment, although the Maghreb is considered to be one of the world's richest region in phosphates, and most of it is exported

in raw conditions.

Agricultural productivity in the Maghreb countries, measured in

terms of area, is relatively low compared with other North African

countries especially with U.A.E. Table 2 throws some light on the agricultural yields of some cereals compared with U.A.R.-

2/

2 - Main agricultural and related products

Por the _purpose of our study we shall deal with the items which

are important for the consumption of the people, and those that occupy a

special place in the exports of these countries, either at the present

time or in the foreseeable future. Thus we exclude products such as

dairy products, bananas, coffee, tea, pepper

(black

or

white)

animal oil, meat preparations, tobacco, as these products constitute the main imports of the area, and there is no prospect to produce them on a largo

scale to meet the local Maghreb needs in the near future. We will, therefore, deal with some selected items as cereals, vegetables, fruit,

t■

with special emphasis on grapes and wines citrus fruits dates and olive oil, livestock and fish.

j/

See appendix

for all tables.

2j

See appendix. ^{.... ...}

Cereals ;

The weather plays ^a role in the fluctuations of the cereal produc¬

tion in the Maghreh as may he shown from table

The production of hard wheat is 20 to 25 million quintals, of which Algeria produces about 10 million quintals. The Maghreb countries as

a whole import between 4 and 12 million quintals. Morocco and Tunisia export some hard wheat estimated in some years at 10,000 quintals each,

but the imports of soft wheat ^were higher than the export of hard wheat.

Barley production ranges from 12 to 18 million quintals, a great proportion of which is produced in Morocco. There has been ^a decrease

in barley production between 1952-56 when the barley cultivated area decreased from 4.6 million hectares to 3.8 million hectares in 1965?

half of which was in Morocco.

The trade balance in barley shows deficit up to 1.5 million quin¬

tals in some years and surplus of 3 million quintals in other years.

Morocco particularly, and also Algeria and Tunisia had some exports,

but the last years showed a need to import barley.

Other cereals are produced mainly in Morocco, such as maize and

rice. Its exports of maize reach 1 million quintals in some years, and

between 20,000 and 50,000 quintals in others.

Livestock; _^

There are about 565,000 horses in the Maghreb, of which 325,000

in Morocco. This number is nearly constant since 1951» Morocco and

Tunisia export some horses in some years. For instance, both countries exported horses of a value of 1 million American dollars in 1965» The number of horses exported to Algeria and Libya is very limited, although Algeria exempted Tunisia and the Maghreb exports form tariffs,

Tunisia exports a considerable number of camels to Libya

(no tariffs).

The number of cows in the Maghreb is about 4»A-million of

_l/

See annex for all tables. 1 1 .4

idep/et/2340

Page 11.

which 3 million in Morocco. There is no trade "between the Maghreb

countries, in cows. Libya and Algeria import considerable amounts of cow

meat, while it seems that Morocco and Tunisia do not have any significant

external trade in this item.

Sheep and goats are estimated at 26,213 million

(15

million sheep and 7 million goats in

Morocco).

^{Trade in} this item in the Maghreb is

insignificant although Tunisia had some exports and imports in some years.

Fish;

Most of the fish production takes place in Morocco where

80%

of the

whole fish production in the Maghreb is produced. Tunisia and Algeria produce

10%

each. Algeria has a small surplus for export, while Libya is

an importer

(131,000

sterling

1966).

Morocco has a considerable surplus

to export

(20

million Dollars in 196o, 12 million dollars in

1965)*

Tunisia also has some fish exports

(400,000 dollars).

In the Maghreb as

a whole there is a surplus for export in this item.

Vegetables:

Vegetables are produced on a considerable scale in the Maghreb.

(Table 5)»

Production has been rising, particularly, potatoes, tomatoes

and dry vegetables. In i960, for instance the whole Maghreb imported 143,000 tons of potatoes, but it had a surplus of 12,000 tons in 1965»

Algeria used to import big quantities of potatoes; its needs decreased

three times in recent years. Libya imports small amounts while Tunisia,

has some little export.

(Table 5)»

Production of tomatoes is also important, and it has doubled between 1955-56 and 1965» This increase happened mainly in Morocco and Tunisia,

while production in Algeria remains the same.

(Tables

6 &

7)«

Dry vegetables ^are less important, although there is a surplus for export, especially in Morocco. Libya imports those products while Tunisia has. ^a surplus which fluctuates considerably

(no

figures for

Algeria).

Onions are needed in Algeria and Libya while Morocco has a surplus for export. Tunisia sometimes has a deficit and sometimes has a surplus.

Fruit:

Production of different fruit is increasing in the whole Maghreb, especially the citrus fruit which doubled between 1952-56 and 1965

(Tabl^8

^&

9).

^{In Morocco} the increase of production was particularly high, and it produces half of the Maghreb production of oranges and mandarines. Lemons- increased by

5%

in the same period. Algeria and

Tunisia are the most important producers of lemons in the Maghreb

(See

tables 8 &

9)«

Date production increased between 1952-1965 ^y

30^,

Morocco and Algeria are the important producers of dates.

Without going into further details about the other fruits it can be said that each Maghreb country has a considerable surplus in fruit,

with the exception of bananas of which Algeria imports half of the whole Maghreb imports, and also apples and pears of which Morocco sometimes

has a small surplus for export. There was a small increase in the total export of citrus fruit

(oranges

and

mandarines)

from the whole, Maghreb

between i96o-65. There was a decrease in production in Algeria, from 230,000 tons to 155s000 tons, while there was an increase in Morocco

from 320,000 tons to 410,000 tons. Lemons surplus for exports was

decreasing.

There were considerable exports of dates from Algeria and Tunisia

(see

Table 10 for production

figures).

From the present situation of production and exports, and from the plans and programmes of the different Maghreb countries it seemsthat

there will be a growing surplus of fruit especially citrus fruits dates

and grapes ready for exportation, while the imports of such products

will be decreasing between the Maghreb countries.

Oil seeds;

The most important product here is the groundnut, where it is pro¬

duced in Libya. Its production is increasing.

IDBP/ET/2340

Page 13.

The total needs for the yearly import of groundnuts in the Maghreb

is estimated at 20,000 tons. Libya exports from 3,000 to 5,000 tons, part of it goes to Tunisia and Algeria. These as well as Morocco are

importers of groundnuts. It is expected that Libya will ha^e a ground¬

nut surplus for export, but it is difficult to foresee the situation of

the other oil seeds in the future. That depends on the demand for the

final products and the national production.—'1/

Olive oil

(and

other

oils)

Morocco, Algeria and to a smaller extent Libya import considerable quantities óf

(vegetables)

oils except olive oil. These seed oil imports

amounted to about 90,000 tons in 1965 for all the Maghreb countries.

Olive oil production was about 130,000 tons in the whole Maghreb,

of which Tunisia produces 70,000 tons

(table 11).

Exports of olive oil exceeds 50,000 tons, Tunisia represents 4-6,000

(table 12).

There is no trade in olive oil between the Maghreb countries.

Wines;

Total production of wines in the four countries of the Maghreb is

about 20 million hectolitres, three quarters of which is produced in Algeria

(see

table

13).

A great part of it is exported to Prance.

Exports of wines decreased in the recent years from 17 million hecto¬

litres in I960 ^- 15 million in 1963—65•

There is a tendency to reduce production of wines in the Maghreb

areas of vineyard decreased from 515,000 hectares in 1952-56 to 490,000

hectares in 1965* Import of wine is free in Libya, but subject to quantitative restructions in the other countries.

3 - Similarity of agricultural products

Prom this brief exposition of the main agricultural products in the Maghreb countries, it appears that they produce more or less the same products. Indeed there is emphasis in some territories on the production

_1_/

Morocco depends on

imports of oil seeds to produce 60)o of its total

oil

(vegetable)

production.

of certain goods, for example, in the citrus fruit group? Morocco produces more oranges and mandarines while Algeria and Tunisia

produce

more lemons. Wines is produced in the whole area, with a greater pro¬

portion of the total production taking place in Algeria.

But all these examples, and some others, would not change very much

'

the overall picture that all the four countries produce most of the main agricultural products.

That, in turn, affects the pattern of trade either

between the

countries of the Maghrob or between them and the outside world.

This similarity in agricultural products is the outcome of

certain

factors s the four countries have the same climate and other natural conditions? they are more or less in the same level of economic

develop¬

ment

(Libya

is a special

case)

^so they produce the ^same products.

Also,

the agricultural producers in Algeria, Morocco, and Tunisia,

before

independence, used to adopt their production to the French

market, and

supply it particularly with wines, fruit and vegetables. This

explains

the big surplus in those three countries of the same products, and they import more or less the same goods. This also explains why exchange

of

agricultural goods between the Maghreb countries is a very

small

propor¬

tion of their total international trade, as will be shown later. Another

factor can be added, that is transport costs were higher between

the

Maghreb countries than between them and France, and Southern Europe ^{^}

where it was more regular.

B - Mineral Resources

The Maghreb is well endowed with some important mineral resources.

We shall give some figures about these and a more

detailed

picture

is

given in the tables of the appendix.

1 - Phosphates^%

Measured by reserves and by production, the Maghreb occupies an important place in the world. In 1967, it produced 13,470,000 tons, and

hence came after the U.S.A. with 35,500,000 tons and the U.S.S.R. with 16,450,000 tons.

IDEP/ET/2340

Page 15. •

The Maghreb, however, is the biggest exporter of phosphates in the

world. In 1967s for instance, its phosphate exports were about

11,690,000

tons, which represented

36%

^of international trade in this item.

This is characteristic of primary producing underdeveloped countries

which export their mineral and agricultural products as raw as they leave

the farms or

mines.^

Morocco;

Morocco is the principal producer of phosphates and.has big reserves.

There are different layers, but two of them are important* The most important reserves are those in Korribga and Oum-Er-Rbia regions. These

reserves are of excellent quality. The

content-^/

^is

1%.

The second layer is in the South West of the country, to the South

of the Massif des .Biarnes. This layer

(of Youssifia)

is less important,

its content is less than the first one

(70-72%).

The phosphate rock is treated in the extraction zones; Khouribga

and Youssifia, and then transported by railways from Khouribga to

Casablanca

(140

km double

track),

and from Youssifia to Safi

(85

km.

single

track).

The Moroccan phosphates production increased from about 5«3 million

ton in 1955 to about 9.8 million tonsin 19^5 and 10.5 million tons in 1968. The reserves are estimated at 40 billion tons.

_1J

In the next chapter we will show some "integration industries" which

would process the phosphates and incorporate them in more complicated

manufactured chemical products, with the help of gas and petroleum in Algeria and Libya.

The complex of chemical products at Safi in Morocco, the complex of

Annaba in Algeria, and the complex of Gabes in.Tunisia, will certainly exploit and process this natural valuable resource.

2J "Teneur".

Tunisia:

The phosphate layers in Tunisia are less numerous and less important

than those of Morocco. They are found in two zones. In the South West

near Gafsa, the mines of Metlaoui, Redeyef, Moulares, and Djebel M'Dilla.

The other zone is in the west-central zone of Kala Djerda.

There are two layers

(veins)

in the region stretching on both sides

of the Algerian-Tunisian borders. The Tunisian phosphates have a content

minor to the Moroccan. But with enriching methods

(ventillatitííT,

"Washing,

and calcinizeiLon

sometimes),

its content becomes:

65.5 $

in Redeyef,

Moulares, mdillaj

65$

in Metlaoui; and 68.5 -

70$

in Moulares and

Mdilla.j/

The phosphates whose

65-68$

constitute, however, the basis of production.

Tunisia is the second producer of phosphates in the Maghreb. Produc¬

tion increased from 2.2 million tons in 1955 to about 2.82 million tons

in 1967° It was expected to reach 4.6 million tons in 1968.

(real

figure

achieved 3.36 million

tons.)-^/

The reserves are important: known Reserves: 1.2 billion tons, and potential reserves from 12-15 billion tons.

The phosphate veins in Tunisia are far away from the ports. The production of Gafsa zone is transported towards Sfax port, and that of

Kalaa Dherda to Tunis Port. Both ports are far from the zones of extrac¬

tion by about 250km„

Algeria:

The phosphate layers at Mzoita near Sétif are exhausted, and those

of Kouif near the Tunisian frontiers are in the _way to becoming exhausted.

But the exploitation of the layers of Djebel Onk have begun. The. content

is .weak:

56$

^-

58$.

By enriching the content Algeria's phosphate can be improved to

75$»

Production of phosphate in Algeria was 94?000 tons in

1966.

_1J

After "Calcinization" and rewashing mdilla phosphates has a content

of

75 &

77$.

2/

ECA Summary of Data.

IDSP/ST/2340

Page 17.

In Libyas There is no phosphate production ^so far as we know? and certainly there is ^no data on any mineral production except petrolieun.

Iron Ores

The reserves of iron ^ore in the Maghreb are quite substantial, as

cam be seen

here.-^

52O million tons in Algeria, 150 million tons in Morocco, 50 million

tons in Tunisia.

Production is fluctuating from one year1 to another

(see

table

19)"^

Algeria's production was about 1„9 million tons in 1955 then increased

to 3«1 million tons in 1965 decreased to about 1.3 million tens in 1966 and reached about 3.1 million again in 1968.

Morocco produces less quantities, 71)000 tons in 1955? 95?000 in 1965 and 820,000 in 1968.

Tunisia's production was 630,000 tons in 1955? increased to about 1,117?000 tons in 1965? and 1,016,000 tons in 19&8.

('25$"'"metal).

Steel industries began in Annaba in Algeria and in Montel Bour¬

guiba in Tunisia.

Zinc concentrates;

Zinc concentrates production in Algeria was 37s300 tons in 1964

and 15s100 in 1964

(31

in 1955 and 1,6 in

1967)«In

Morocco produc¬

tion was 43,300 in 1955? 95,000 in 1965? and 70,000 in 1968. Por

/ /

Tunisia the figures were 4,700? 7,100 and 7,200^ for these three years

respectively.

_1/

Figures taken from lecture note's on the economic integration of the Maghreb. IDEP course, Tunis, 4-28 March 1969? "Inventoria des

Ressources du Maghreb

(also

the figures for

1955),

^{by Ezzedin} Makhlouf.

2/ Tables

in the index.

3/

Inventorie des ressources du Maghreb

(op.cit.)

4j/ 55$

metal.

Lead concentrates;

Production in Algeria was 10,200 tons in 19555 10,400 in

1965?

4,900 in i960, and 4,200 in 1967, while Morocco it was

89,300

in 1955»

113,000 in 1965 and 120,000 in 1968. In Tunisia the figures were

26,600

for 1955, 25,000 for 1965 and 24,100 in 1968.

Other Minerals;

There are some other minerals. In Morocco, for instance there is

manganese and manganese bioxide production was about 341,000 tons but

it decreased to 160,000 tons in 1968. Copper concentrates in Morocco

were 6,500 ^{tons in} 1964 and 11,500 in 1968 while its cobaltore production

was 15,300 tons and 15,500 tons respectively.

In Algeria salt production was 116,000 tons in

1966

and its gypsum

was 41,000 tons in 1965-

Tunisia has a production of mercury ore which increased from

5,298

tons in 1964 to 11,568 in 1968, and the expected production from flueros-

par is abowc 40,000 tons.

Energy;

Under this heading we would show the production of electricity,coal

Petroleum and natural _gas. Two items here are of special importances

Petroleum and natural gas. Lihya is considered now as one of the leading-

countries in oil production and export. Algeria's reserves of natural

gas are said to he inexhaustible.

1 ^- Electricity;

Production of electrical power in Algeria was 1,128 million kwh in 1964 and it increased to 1,272 million kwh in the first nine months of 1968

(Jan-Sept)

and 1305 million kwh for the whole

years.-^

^{In Morocco}

it was 1,216 million kwh in 1964 and 1,538 kwh in 1968. In Tunisia the figures were 334 million kwh and 545 million kwh for the two mentioned

years. For Lihya production of electricity was 126.5 million kwh in 1964

and reached 212 million kwh in 1967-

_1J

Bulletin de Statistique General

1969

U°. 2

IDEP/ET/2340

Page 19.

2 - Goal;

Coal production in Algeria decreased from 46,800 tons in 1964 to 16,800 tons in 1967» In Morocco it was

418,300

tons in 1964 and 451*000

in 1968, while Tunisian production was 40,000 tons and

37,684-^respec-

tively.

3 ^- Petroleum products;

Crude Oil

In Algeria the crude oil produced in 1964 ^was 26,232,000 metric tons, increased to 42.5 million tons in

1968.-^

Morocco crude oil pro¬

duction was only 119,800 tons in 1964, and only 88,600 tons in 1968,

while in Tunisia production was 750,000 tons in 1965 and increased to 3,191,000 tons in 1968.

Since 1961, Libya has been one of the most important producer of

crude oil in the world. Production of crude oil was 6.6 million barrels, then, increased to 313.6 million barrels in 1964 and to 950.3 million

in 1968. There is a significant increase in production in 1968, that exports of 1000 million barrels a year is reported.

4 - Natural gas :

Natural gas production in Algeria is the highest in the Maghreb.

Production increased from 804 million cubic metre in 1964 to 2,315

million metre in

1968.^/

No natural production in Morocco, while produc¬

tion in Tunisia increased from

7,716,OOOm^

ⁱⁿ 1964 to

9,443,000ra^

ⁱⁿ

1968.

JJ

ECA Summary of Data.

2/ "Europe,

Prance Outremere, April

1969,

N°.471.

3/

2,342,

453,300m-^,

the production in

1968,

Europe Prance outremere op.cit.

Natural _gas is also produced in Libya, and at the end of 1-968 tests

were made at the _gas liquefaction plant at Marsa Berga. Liquid gas is expected to be exported

(in 1969)-

The capacity of the plant is 345

cubic feet of _gas in

1967.-^

1/ Refined oil products;

In Algeria the production of motor spirit was 326,000 in 1964 and 484,000 tons in 1967? and of kerosene 147,000 and 212,000 respectively

while distillete fuel oils production was 462,000 and 625,000. Resi¬

dual fuel oil production was 517,000 in 1964 and 614,000 in 1966.

Production in Morocco of petrol increased from

229•400m3

^to 339,600m

in 1967, gas oil from 352,600 to 438,000 to

m3

fuel oil from 361,600

to 412.8

n)3s

^{and Butane gas from} 25,800 to 39,600 tons.

Tunisia produced 68,000 tons of motor spirit and 82,200 million in 19685 Kerosene 62,000 tons in 1964 decreased to 55,000 tons in 1968,

Gas oil 2585ooo and 312,400 respectively, fuel oil increased from 192,000 tons to 371,500 tons in the previous two years.

In Libya, the refinery of Marsa Berga is producing and refining petrol, kerosene and diesel oils. At the end of 1967, 1000 barrels

of refined oil was produced daily. Increase of

25^

^was planned for 1968.

(Summary

of Data

op.cit.).

idep/et/2340

Page 21.

II - Low levei of Industrialization

The low level of industrialization in the Maghreb would be found in

the low figure of per capita indus trial product which was about

10,800

old French francs-7 in1/ 1966. It also can be found in the very low level of production and of consumption of some basic products.which are so essential in industrial development plans or programmes. If we examine

the production of pig iron and steel in the Maghreb we find it is about

2<?o

of that of countries which are still in their phase of development,

such as Maxico, Argentina, Spain and Yugoslavia, and about

3%

of that of

Poland.

Consumption of electricity per capita is 6 to 13 times less in the Maghreb. The situation is better in cement production as it varied

between

1/5

and

2/3

of the above-mentioned

countries-^

J

(See table

in

the appendix).

_1/

1 new French francs ⁼ 100 old French francs. 1

US$

= about 5 ^new-

French francs

(before

the devaluation of the

franc).

So this figure equals about 21.3 US dollars. Gross per capita product in 1966 w?s 120,000 old freneh francsaild the average percentage of the manufacture

industries in GDP in the Maghreb was

9Í°

^per capita GDP in the Maghreb

is about 120,000 old french francs, while it was 3,000,00 for

Argentina

26,0,000 for Spain, and 210,000 for Mexico.

See Ben Amor, Sub-Regional Industrialization as the Foundation of the Maghreb Economic Integration, Lecturers notes, IDEP, Sub-regional

course on Economic Integration of the Maghreb

(2-28

March

1969)»

2/

The Maghreb production of castings, steel and electricity in

1965

a"d

its consumption for the same year of fertilizers and cement is far

behind those of Argentina, Mexico, Spain, Poland, Yugoslavia 15 years ago i.e. 195O.

We have seen "before the place of agriculture in the Maghreb

economies, the following figures would show the share of the different

sectors in GDP, It will be seen that the manufacturing industry represents an average low percentage of the GDP i.e.

9$«

1/

Share of industries in the _gross domestic product in 1964—'

Sectors Algeria Libya ^{Morocco Tunisia}

Agriculture ²⁰ 7 29 25

Mines 19 53 ^{6 2}

Manufacturing 9 3 12 12

Building 5 ³ 5 ⁸

Gas, Electricity and Water ^{2 - 2 2}

Transport, Communieations Trade, Services and Adminis¬

tration 11 11 11 __1£

- -

100 100 100 100

An idea of the size of enterprise, their number, and the number

of workers they employ could be grasped from the following figuress Ç /

Medium size Maghreb industrial enterprises-7

Dumber of Industries con-

considered

Dumber of persons

(in 1000)

Value added

(billion

^of

old French

francs)

Average number of employees Ijer enterprise

(unit)

Algeria 1964

Libya 1967

Morocco

jM

Tunisia

1966

"

,008

7I

1,316

.47

1,04*

147 17 213 82

65 41 97

_l/

Sources The Great Arab Maghreb.

2/

Ben Amor, op.cit.

p.6.

idep/et/2340

Page 23.

Enterprises employing more than 500 persons do not probably exceed 15 in any of the four countries. There were 15 in Morocco in

1967?

out

of total of about 2,000

enterprises-l/(or units).

"In Tunisia thef'e were

more than 15 enterprises employing over 500 persons in

1966.

Most of

them are in the mining sectors, electricity, water, and

gas..2/

JJ

The majority of industrial enterprises in Morocco employ between 10

and 49 wage earners. There are 1,457 of them representing

73.5%

of

the total. There are 246 enterprises, employing from 50 to 99 and represent

13.41%

and 243 enterprises employing from 100 ^- 499 workers

which represent

12.31%.

See "M. Noir," La Géographie de l'industrie

Marocaine" and La vie Economique" of 20th and 27th of December 1968.

2/

To compare with France, for instance, we find that in

1966

there were 1,557 enterprises employing more than 500 wage earners

(2,332,500 persons)

^{of which} 1265 were industrial enterprises

(59 transportation

140 trading and 83,

services).

111 ~ SMALL INTER-MAGHREB TRADE

a. Trade in agricultural products

Algeria's chief exports are cereals and Tobacco to Tunisia, Fruit

and Fruit juice to Morocco. Algeria imports vegetables from Morocco

(40^)5

^peppers, tinned fruit and vegetables from Tunisia, and fruit from

Morocco.

80$

of Libyan exports in the year 1960 were groundnuts to Algeria and Tunisia. Also tobacco and tomato paste

(purée)

^Libyan

imports from the other Maghreb countries between i960 and 1966, were camels from Tunisia and Algeria

(58$

of

imports),

barley, wheat, sugar, meat. Morocco's exports to the other countries are mainly vegetables:

tomatoes and chickpeas to Algeria and Libya

(20$)

between 1960-1966.

Vegetable exports to Algeria decreased to a great extent since 1985s

but some of it went to Libya.

(Melons

^{to Algeria:}

6$

1960-66 ^- wheat

to Algeria

(196o-62) 8$.

Moroccan imports of agricultural products from

the other three countries are very small. Moroccan imports from Algeria

are mainly dates

(60$)

in 196o-66, barley

13$

in 1961, and Tobacco, and

some fruits in some years.

The important exports from Tunisia, to the other Maghreb countries

in 196o-66 ares Camels to Libya, pepper to Algeria, hard wheat to Algeria and Libya, olive oil to Algeria

(196o-64).

These-represent half of total agricultural products of the Maghreb countries. In some years there are exports of livestock and meat to Libya, and to a lesser

extent to Algeria, fish, tinned fish, tinned vegetables especially

Algeria, Almonds and peppers to Algeria and Libya. The main Tunisian >

imports were: barley from Algeria

(1961,

1964 and.

1965) 3$

fat from

Morocco

(7.5$)

^from 60.to 1962 dates from Algeria

(5.2$).

There were also onions and Tobacco from Algeria.

One of the characteristics of trade between the Maghreb countries

is that the goods exchanged were not stable or continuous, few items only were continuously exchanged between those countries in the period 60-66. The rest were exchanged only for one or two years. Commodity

transactions between the Maghreb countries are exposed to fluctuations,

which demonstrates that these exchanges satisfy marginal needs only in

the importing countries. Slight changes in the production of the importing country would result in big fluctuations in imports.