MOROCCO: CURRENT POLICIES AND PROBLEMS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP06T00412R000200550001-8
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• Document Creation Date: December 21, 2016
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• Content Type: REPORT

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Foreign
Assessment
Center
Morocco: Current Policies
and Problems
State Dept. review completed
Secret
NESA 81-10029
November 1981
283
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25X1
Morocco: Current Policies
and Problems
Summary King Hassan, who plans to visit Washington before the end of the year, is a
close friend of the United States and represents one of the strongest
leaderships in the Arab world. He has gradually adapted the monarchy,
which commands widespread respect, to a more democratic form of
governance and recently has generally outmaneuvered rather than re-
pressed his critics. Economic difficulties, made worse by this year's drought
and uncertainty over the outcome of the King's efforts to gain sovereignty
over Western Sahara, have developed into a major challenge for the
King-one that has already engendered disaffection with his policies even
among those traditionally most supportive of him. Nevertheless, he faces
these difficulties with the backing of loyal and fairly effective security and
military establishments, which are the only institutions capable of threat-
ening his rule.
The King will be looking for financial and diplomatic support from the
United States, with which he believes he has established a special
relationship. The moderation Morocco has espoused in international and
Arab forums has benefited the United States, particularly on Arab-Israeli
issues in which Morocco has acted as an intermediary between other Arab
and Israeli officials. The King believes his longstanding warnings about
Soviet machinations in Africa-too often ignored in Washington in his
opinion-should earn him a special hearing in his appeals for US support
of Morocco and other Arab moderates.
This memorandum was prepared by the Maghreb Branch, Office of Near Eastern and
South Asian Analysis. It was coordinated with the Office of Global Issues, the Office of
European Analysis, the Directorate of Operations, and the National Intelligence Officer for
the Near East and South Asia. Information available as of 23 October 1981 was used in its
preparation.
Secret
NESA 81-10029
November 1981
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 Figure 1
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Morocco: Current Policies
and Problems 25X1
The Domestic Political King Hassan dominates Morocco's secular and religious life, despite his
Scene sponsorship of what official spokesmen like to call Morocco's "democratic
minor ones. There is, moreover, widespread respect for the monarchy as an
institution symbolizin continuity and legitimacy, even though Hassan is
groups. But none has developed enough legitimacy or popular following to
restrict his ability to make virtually all major policy decisions and many
experiment." Under his tutelage the country has developed a largely free
press, a cabinet-style government with a parliament, and a variety of
political parties and interest groups that are always vocal and often
troublesome. Hassan is now obliged to consult more frequently with these
personally unpopular.
In his 20 years on the throne, Hassan has maintained his political
preeminence largely through his skill at balancing competing factions and
a interest groups. He rewards his supporters with patronage; he conciliates
Figure 2
25X1 King Hassan II of Morocco.
his critics when possible but does not hesitate to crack down when he deems
it necessary. Efficient and well-equipped security forces back up Hassan's
.authority, and the monarchy has the support of the armed forces, the only
element capable of unseating the King. 25X1
Despite Hassan's professed commitment to political evolution, many
Moroccans are worried about the future of the "democratic experiment."
Serious rioting in Casablanca last June was triggered by substantial cuts in
government subsidies for basic foodstuffs. Those riots and mounting
criticism from the socialists of his government's policies-especially in
Western Sahara-have led Hassan to deal harshly with dissent. Arrests
and trials of opposition socialist political and trade union leaders along with
increased harassment of rank-and-file members have fragmented the
socialist opposition. Beset by conflicts between cautious leaders and more
radical younger members, the socialists are demoralized and lack a clear
strategy for the future. They are also isolated from the other political
leaders, who have not joined in criticizing the King's initiative to settle the
Western Sahara dispute. The socialists are betting that they can capitalize
on Hassan's resort to repression to rebuild the popular support they lost
over the summer. 25X1
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Tension is likely to rise this fall as students return to school and as seasonal
food shortages, aggravated by a long and severe drought, peak. The
confrontation with the socialists is also likely to continue. All but one of the
15-member socialist delegation withdrew from parliament in early October
to protest the King's extension of the parliamentary term, but most have
since returned.
Disnuall Economic This year's drought-the worst in 35 years--along with continued high
Performance levels of defense spending and a heavy foreign debt burden have led to a
sharp economic downturn since the spring. Over half the grain crop has
been destroyed, and Morocco will have to import nearly 3 million tons of
cereals this year-almost twice last year's amount. Adverse weather will
probably drive up the bill for foodstuff imports in 1981 by over $350
million. The cost of government food subsidies will exceed budgeted levels
by over 40 percent and will account for 7 percent of expenditures despite
the substantial subsidy cuts made in May.
Morocco's economy is still suffering from the effects of the three-year
austerity program that the government introduced in 1978 after excessive
spending during 1973-77 and the collapse of the phosphate market in 1976.
Although restrictive measures helped reduce trade and budget deficits,
they hit the modern sector of the economy especially hard and contributed
to a slowdown in construction and manufacturing. Slow economic growth
also boosted unemployment-already :high--to 20 percent in major indus-
trial areas, while the wages of those employed failed to keep up with
inflation.
The nation's foreign payments position is again deteriorating sharply. Food
imports have already consumed a large portion of the special funding that
Morocco received from the IMF this year, and foreign exchange reserves
cover only two weeks of imports. Morocco's soaring debt-service burden
and IMF-imposed limits on nonconcessionary borrowing will force the
government to cut nonfood and nonfuel imports by 10 percent this year.
Even so, the current account deficit will grow to about $2.2 billion in 1981,
up by about half over last year.
Rabat's serious foreign payments position and escalating budget deficit
have jeopardized the nation's continued access to special IMF funding,
compromised Morocco's ability to meet debt-service obligations, and
intensified inflation-which will probably exceed 20 percent this year. The
IMF recently told Morocco that it had. not complied with the terms of its
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Morocco: Indicators of Economic Activity
A
alncluding wheat, barley, and corn products.
b Esti mated.
Phosphate Rock Production
Real GDP Growth
special funding arrangement, and the IMF plans to withhold further
financing until there is agreement on new targets. Morocco probably will
also need to reschedule its $7.4 billion external debt.
25X1
Concessionary loans and grants from Arab benefactors-particularly
Saudi Arabia-have accounted for about one-fourth of Morocco's foreign
financial assistance since 1974. Under the guise of aiding Morocco in the
Western Sahara dispute, the Saudis have paid for a large percentage of the
military equipment that Morocco has acquired from the United States and
France over the past two years. Riyadh has been reluctant to extend direct
financial support for Morocco's military modernization program, however,
and it is unclear how much military aid the Saudis will continue to give
now that Morocco's position in the Sahara has improved. Saudi economic
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aid will probably continue at or near the present level because of Riyadh's
concern about Morocco's internal situation and the close ties between the
two royal houses.
This was to be the year Morocco launched its ambitious $22.7 billion five-
year plan aimed at returning the economy to the 7-percent annual real
growth rate achieved during the phosphate boom in the early 1970s.
Instead, implementation of the plan has lagged, and real GDP growth
probably will fall well below the 3-percent level achieved during the
austerity years of 1978 and 1979.
25X1
Although the country has considerable potential for growth over the long
term, Morocco's financial squeeze will be especially acute through 1983.
Barring a heavy influx of new concessionary financing, limits on govern-
ment spending and domestic credit will have to continue. This will preclude
the implementation of many aspects of Rabat's ambitious development
plan or the recording of significant increases in the standard of living.F__~ 25X1
Attitudes of the In the unsettled atmosphere at home, the attitude of the armed forces-
Military which twice spawned coup attempts against the King in the early 1970s-
has become increasingly important. Military morale has been high since
the middle of last year, largely because of the results of the counter-
insurgency campaign waged against the Polisario Front. A long overdue
relaxation of Hassan's personal supervision of the armed forces along with
greater royal attention to other longstanding military grievances also
contributed to the improved attitude
Rabat continues to prepare for more fighting, despite the military's
dominance over the Polisario Front and the talk of a peaceful settlement in
Western Sahara. Morocco is planning major sweeps later this fall which
are intended to weaken the guerrilla forces through destruction of supply
caches and disruption of lines of communication. The Moroccans are using
the current lull in the fighting to refit, resupply, and rotate units in the
south and Western Sahara, where nearly two-thirds of the ground forces
are stationed.
Even if the costly war in the Sahara should end soon, overall Moroccan de-
fense expenditures will continue to burden the economy. In its efforts both
to bolster combat capabilities in Western Sahara and to modernize its
forces, Morocco has recently obtained sophisticated equipment from the
West. It purchased Alpha jet trainers and VAB armored personnel carriers
mounted with various cannons and missile systems from France and OV-10
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reconnaissance aircraft and C-130 aircraft from the United States. In
addition, Morocco activated a new air defense radar network in September.
25X1
The threat of a war with Algeria as well as the need for effective military
countermeasures against Polisario incursions in Western Sahara prompted
King Hassan to implement a military modernization program in 1974. As
part of this plan Morocco has sought to build a military force that has
strong antitank and air capabilities. In order to achieve a more flexible
defense the Moroccan Army has adopted a combined arms force structure,
mixing armor, artillery, and mechanized and motorized assets, and is
attempting to upgrade the entire force by replacing obsolete or worn-out
items. Even after the Sahara conflict ends, Morocco will be eager to
maintain a military balance with Algeria, which enjoys an advantage in
some categories of weaponry. 25X1
The Moroccan military is encountering serious difficulties in absorbing the
steady influx of new aircraft, armored vehicles, and other equipment. This
is likely to continue over the next few years. Trainable people to operate the
new weapons systems will be hard to find, and the accelerated pace of
modernization will further strain Morocco's cumbersome system for
providing spare parts. 25X1
criticism that this friendship with Cairo draws from hardline Arabs
Foreign Policy King Hassan of Morocco professes to follow a nonaligned foreign policy
Concerns but in fact has adopted a generally pro-Western, moderate stance.
Morocco cooperates closely with Western countries and like-minded Arab
states-especially Saudi Arabia and Tunisia-in international forums. The
King is deeply suspicious of Soviet intentions in the Middle East and
Africa, and he has repeatedly sought to persuade Western leaders that
Morocco is Moscow's prime target for destabilization in Africa.
25X1
The moderation of Moroccan policy is especially evident in Middle East
questions. Morocco has historically acted as a bridge between the Arab
states and the West. It also has more recently served as an intermediary
between the Arabs-especially Egypt-and Israel. Because of its generally
good treatment of its Jewish community and the large number of
Moroccan Jews permitted to emigrate to Israel in the late 1950s and early
1960s, Rabat has been able to sustain a behind-the-scenes relationship with
Tel Aviv. Morocco also discreetly maintains close ties with Egypt despite
25X1 Hassan's reluctant rejection of the Camp David peace process and the
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Western Sahara. King Hassan's domestic fortunes have been inextricably
linked to the Sahara question since the early 1970s. His stress on
"regaining" Spain's former colony-which he maintains was part of the
Moroccan realm for centuries and to which Morocco asserted formal claim
in 1976-has in the past helped rally support around the monarchy. Over
the past few years, however, popular attitudes toward Hassan's handling of
the conflict have been changing. The desire to retain the Sahara at all costs
is giving way to popular dissatisfaction with the heavy financial drain of
the war. Such dissatisfaction apparently exists at all levels of Moroccan
society, including the wealthy commercial and professional elite that has
traditionally supported the monarchy as well as some junior and middle-
level military officers, but it is apparently strongest among the poor in
Morocco's crowded urban slums.
Morocco's position on both the military and diplomatic fronts has improved
since the beginning of the year. Rabat gained the initiative on the
battlefield in mid-1980 after a series of reverses prompted long-delayed
reforms in command and control procedures. The defense perimeter in the
territory's northwest has largely frustrated the guerrillas' ability to stage
hit-and-run attacks. The Polisario can. still hit isolated outposts outside the
perimeter as they did in mid-October, when the guerrillas inflicted heavy
casualties on the Moroccan garrison at Guelta Zemmur. The incident at
Guelta Zemmur could indicate enhanced Polisario capabilities, most
notably in their reported use of SA-6 missiles. The Polisario, however,
probably will be unable to sustain this high level of activity or regain the
initiative.
Hassan's endorsement last June of the OAU's plan for a referendum on the
territory's future has enabled Morocco to reduce its diplomatic isolation
and opens the prospect for legitimizing Moroccan control. With the
ensuing talk of peace that has filled the Moroccan press there has come the
expectation-however unrealistic-that substantial funds will be freed for
shoring- up the economy. All of Morocco's political leaders have privately
questioned the King's strategy to bring peace; they fear that Morocco will
be unable to ensure a favorable vote. The socialist opposition, which is
particularly vocal in asserting Morocco's claims to Western Sahara, tried
unsuccessfully to challenge the King's authority to submit the issue to a
referendum. But the other parties did not join the challenge, and Hassan
probably will be able to keep dissent on the question within manageable
bounds.
The King needs a settled domestic situation and a broad popular consensus
to carry out a referendum on the Sahara. It remains unclear how the
flareup of dissent last September and the clash at Guelta Zemmur will
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affect his efforts. We have seen no firm indication that Hassan has become
less flexible in his approach to a peaceful solution. Much will depend on Al-
geria's willingness to cooperate and on Hassan's ability to minimize OAU
and UN involvement so that the referendum's results will be palatable at
home. Neither is by any means assured.
Relations With Libya. Rabat and Tripoli struck a temporary political truce
just before the OAU summit last June; a month later they restored
diplomatic ties that were cut in April 11980 when Libya recognized the
Polisario Front's self-proclaimed rule over Western Sahara. Tripoli's effort
to break its diplomatic isolation and Rabat's interest in discouraging
Libyan political and military support for the Polisario motivated the
reestablishment of formal relations.
Morocco, however, continues to harbor Libyan dissidents and is working
behind the scenes against Qadhafi's machinations in Africa and the Middle
East by offering military and security assistance to friendly regimes. Rabat
has no illusions about Qadhafi's intentions and considers the current
improvement in relations only tactical. Hassan has doubtless become more
concerned about Libyan intentions following, the assassination of Egyptian
President Sadat and probably doubts that the rapprochement with Tripoli
can continue much longer.
Relations With France. Hassan's interest in improving relations with the
United States stems from his concern that one of the underpinnings of his
foreign policy is eroding-close relations with France. The King fears that
the Mitterrand government places greater importance on relations with
socialist Algeria, Morocco's regional rival, than did the Giscard govern-
ment, which favored Morocco. Hassan's concerns were promoted by
several warm visits to Algeria by French Government authorities this year
and by the French Government's first official reception of a Polisario Front
delegation this summer.
Also at stake are Morocco's military links to France. Paris has long been
Rabat's primary source of military hardware, and large Moroccan arms
purchases and financial constraints in recent years have resulted in
arrearages. The Mitterrand government seems less tolerant of carrying
these debts than its predecessor, and France may slow military deliveries if
Morocco's bills are not paid. Although the bilateral military arms agree-
ment signed before the French elections last spring does not expire until
1985, Paris has refused-at least for the time being-to discuss new arms
contracts.
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Concern also is mounting in Rabat over economic links to France, its
largest trading partner. Paris appears less willing to make the substantial
investment in Morocco's phosphate and energy industries that Rabat
expected when it formulated its five-year plan in 1980. Morocco's access to
EC markets may also be in jeopardy because the Mitterrand government is
less likely to champion Rabat's cause in negotiations with EC members.
President Mitterrand is sympathetic toward Moroccan and other expatri-
ate workers in France, but slow economic growth could, over time, force
Paris to reduce the number of foreign laborers in the country. This would
intensify Rabat's growing unemployment burden and cut worker remit-
tances, which supplied almost $980 million in foreign exchange last year.
25X1
Specific Objectives A special relationship has long existed between Morocco and the United
During Hassan's Visit States because of Rabat's generally pro-Western stance and moderation on
to US Middle East issues. Rabat, nevertheless, has in the past upbraided
Washington for not standing up forcefully against Moscow's machinations
in the region and for failing adequately to back its friends. King Hassan
believes a different climate now prevails in the United States and during
his visit to Washington in December will promote closer bilateral ties. _ __, ,
King Hassan and President Reagan have never met, and Hassan will seek
to establish a warm personal relationship with the President. Hassan values
direct "private channels" to friendly heads of state and relies on this
method of communication to carry on his most sensitive dealings, bypass-
ing normal diplomatic channels. The cultivation of such a special relation-
ship will be particularly important to Hassan now that his good friend
Giscard is no longer in power in France.F_ -1 25X1
The King is sure to raise Morocco's economic plight during his visit to
Washington. He will probably request concessionary financial support and
greater aid to help him deal with Morocco's serious grain shortage, which
will persist through 1983. Although Morocco needs substantial assistance,
the US Embassy in Rabat believes that as little as $50 million in
immediate economic support would have a positive effect and demonstrate
US concern for Hassan's economic problems. In addition, the King may
seek US training and technical aid in support of Rabat's plans to develop
oil shale, fishing, and agriculture resources.
The King was greatly pleased when the United States decided to sel25X1
military equipment to Morocco last spring. He will probably ask for
additional arms and equipment, especially airborne surveillance and
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advanced ground radar systems to support the country's military modern-
ization program. Hassan will want concessionary financing in any arms
deal, and he may request a rescheduling of current payments for arms and
equipment. Hassan is also likely to push for more US training for
Morocco's military forces, especially its air force.
The King probably will also want to enlist US support for his plan to bring
peace to Western Sahara. He is likely to ask Washington to lobby in
Algiers for continued cooperation-especially in light of the clash at
Guelta Zemmur-and for Algeria to press the Polisario to cooperate.
Hassan may also ask the United States to define the conditions under
which it would recognize Morocco's claims to sovereignty over the
territory, fearing the planned referendum might collapse.
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