From Dependency to Decarbonization: Morocco’s Energy Transition as a Strategy for National Autonomy and Economic Diplomacy

This thesis examines the phenomenon of Morocco's energy transition from multiple angles – macroeconomic, developmental and diplomatic – and proposes a tripartite analytical framework based on which Morocco's energy transition may be viewed simultaneously as: a) Macro Stabilization Strategy: A response to the problem of structural economic vulnerability resulting from extreme dependency on foreign fossil fuel imports b) Green Industrial Policy: Structural economic transformation facilitated by domestic renewable energy industry; and c) Economic Diplomacy Strategy: An asset to increase Morocco's geopolitical clout and facilitate entry into international energy markets. Throughout much of its post independence period of development Morocco has been affected by serious structural vulnerabilities, specifically relating to the problem of excessive fossil fuel importation. Due to importing 90% of its energy demand from abroad, Morocco had faced permanent exposure to global price fluctuations, periodically erupting into full-blown macro-economic crises. As illustrated by the notorious example of 2012 when Morocco's current account deficit reached 9.5 percent of GDP, foreign currency reserves fell to less than four months of import coverages and subsidies amounted to 6.6 percent of GDP, Morocco has faced a cumulative structural vulnerability accumulated throughout several decades. It was precisely the launching of Morocco's National Energy Strategy in 2009 by his majesty the king Mohammed 6 that marked the beginning of Morocco's comprehensive response to its historical vulnerability: the establishment of alternative renewable energy production capacities and institutions as well as the development of the relevant domestic industry and the usage of renewable energy transition for economic diplomacy purposes in order to strengthen Morocco's standing. As can be seen, such a framework enables one to address all aspects, advantages and weaknesses of Morocco's energy transition. Thereby, this research consists of five chapters. In chapter one I will present the theoretical framework followed by literature review. Chapter two will consist of diagnostic analysis of energy vulnerability based on evidence from Moroccan history. Specifically three mechanisms through which fossil fuel import dependency led to macroeconomic instability: exhaustion of foreign currency reserves; costly subsidy burden related to Caisse de Compensation subsidy program, and direct pass-through effects on domestic inflation and growth caused by fluctuations on world market. In chapter three Morocco's transition strategy will be addressed along with evaluation of the transition outcomes and remaining challenges, while chapter four deals with Morocco's energy diplomacy in three main directions – Morocco-EU renewable energy partnerships; Moroccan ambitions to become an energy supplier to the rest of Africa, and finally Morocco's climate policy advocacy on international scene. Lastly chapter five presents a concluding discussion based on the critical assessment of findings and conclusions drawn above. Morocco's energy transition cannot be described either as completely successful undertaking or simply greenwashed project. To comprehend achievements and limits of this process we should adopt an analytically rigorous and theoretically sound approach that combines perspectives from different disciplines.