Middle East Sovereign Funds Invest in Moroccan Tourism Industry
It seems that Middle Eastern based sovereign funds are more keen on investing in hospitality and resort developments compared to their Asian and European peers. This is good news for the Kingdom of Morocco. Tourism is a key source of diversifiable revenue for the North African Kingdom of Morocco. The tourism industry in Morocco employs just below 500,000 people. Cash-strapped Morocco still suffers from high unemployment, a reliance on material exports, and has a young demographic profile.
In December 2010, Gulf sovereign investors parked money into the region. Last week, the Qatar Investment Authority (QIA) and Morocco agreed to create a 50-50 joint venture worth US$ 2 billion that targets major development projects in Rabat.
Rabat is the capital and third largest city in Morocco.
In another deal, Qatar Holdings, the Kuwait Investment Authority’s Al Ajial Investments and Aabar Investments agreed with Morocco’s Fund for the Development of Tourism to inject US$ 2.5 billion into a newly-created vehicle called Wessal Capital. Wessal Capital will focus on developing new resorts in Morocco.
Proposed Equity Capital Structure of Wessal Capital
- 25% Qatar Holdings
- 25% Al Ajial Investments
- 25% Aabar Investments
- 25% Morocco’s Fund for the Development of Tourism