The 25 percent safeguard duty for hot rolled products and steel pipes and tubes recently introduced by Morocco’s government are to the benefit of the sole local flats producer Maghreb Steel. However, there are concerns that the trade restriction will diminish fair competition in the market.
In particular, the local Federation of Metallurgical, Mechanical and Electromechanical Industries (FIMME) has underlined that limiting imports will have a negative impact on domestic pricing, which will be eventually transferred to the finished product and be borne by local metal workers and contractors. "The impact on the final product will be at least 15 percent," said Chafiq Essakalli, CEO of CAM, a local company operating in the shipbuilding sector. In the tube sector, the situation is similar as the safeguard is seen as a measure protecting pipe makers and Maghreb Steel, which sells from 30 to 40 percent of its products for pipe manufacturing purposes. However, users of pipe products will be hit, including furniture and household appliance producers and also consuming projects (structural works, bridges, etc.).
As a result, FIMME stresses the harmfulness of the protective measures for the local economy and consumers, which will carry the additional costs. “It all will hurt the economy which is already slow. Morocco is a developing country and is still investing in the infrastructure. With this 25 percent, the bridges, dams, etc., will cost more,” a trader told SteelOrbis.