US embassy cable - 05RABAT1144

UNCLAS SECTION 01 OF 02 RABAT 001144 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR H, NEA/MAG AND NEA/PI 
PASS USTR FOR D. BELL 
USDOC FOR ITA/MAC - D. ROTH 
USDOC ALSO FOR USPTO 
 
E.O. 12958: N/A 
TAGS: ECON, ETRD, ELAB, KIPR, OREP, PGOV, MO 
SUBJECT:  CODEL SMITH MEETS WITH COMMERCE MINISTER MEZOUAR 
 
 
(U)  This message is sensitive but unclassified.  Please 
protect accordingly. 
 
1.  (SBU)  Summary:  In a very friendly June 2 meeting with 
Moroccan Minister of Commerce and Industry Mezouar, CODEL 
Smith discussed FTA implementation, Moroccan economic 
reform, support for small businesses as an engine for growth 
and job creation, and the importance of judicial reform to 
attract investment.  After congratulating Morocco for 
pursuing the right track on reforms, CODEL Smith raised WTO 
Doha Round market access and intellectual property rights 
concerns.  Specifically, Senator Smith (R-OR) relayed Nike's 
interest in including tariff reduction on sporting goods in 
the WTO market access negotiations.  They also discussed 
efforts to combat counterfeiting and trademark infringement. 
End summary. 
 
2.  (U)  On June 2, Senators Gordon Smith (R-OR), Patrick 
Leahy (D-VT), Jeff Sessions (R-AL), and Mike Enzi (R-WY) met 
with Moroccan Minister of Commerce and Industry Salaheddine 
Mezouar.  The Senators were accompanied by staffers 
Elizabeth Stewart, Kevin MacDonald, and Col. Art White. 
Mezouar's Chief of Staff Karim Taghi, Patent and Trademark 
Office (OMPIC) Director Aziz Bouazzaoui and Director of 
Industrial Production Jamal Jamali joined the the Minister. 
The Ambassador and EconCouns also attended. 
 
3.  (SBU) Underscoring the importance of the bilateral 
relationship, Senator Smith welcomed imminent implementation 
of the bilateral FTA - a sign of the U.S.-Morocco 
partnership.  Smith said that as a member of the Senate 
Finance Committee he hears from a large number of countries 
seeking FTAs, but Morocco got one, because it has embraced 
reform, transparency, and economic growth.  Agreeing that 
the FTA reinforces strong bilateral ties, Mezouar called the 
FTA a "real window of opportunity" to adopt a new Anglo- 
Saxon approach to economic management.  He reported that 
Moroccan officials were working day and night to complete 
the necessary legal and regulatory changes necessary to 
fulfill all the FTA's obligations, especially with regard to 
intellectual property rights (IPR) protection.  The Minister 
insisted that IPR protection was itself an important 
component of Morocco's development.  The Government of 
Morocco (GOM) was defending these property rights not only 
due to FTA considerations, but also out of conviction and 
because these efforts will benefit Moroccan economic and 
cultural development.  Mezouar proudly noted that Customs 
will now be empowered to seize counterfeit goods at 
Morocco's borders, and changes to commercial laws will 
accelerate court cases.  As a former businessman, Mezouar 
added, he understands the importance of investing in a brand 
and reaping a return on a trademark's use.  Smith thanked 
Mezouar saying he hoped Morocco would be the "shining star" 
seen in its national flag for the Middle East region. 
 
4.  (SBU)  Expressing hope that the WTO Doha Round would end 
successfully, Senator Smith noted Nike - an Oregon company - 
was anxious to secure the reduction and elimination of 
tariffs on sporting goods in the non-agricultural market 
access (NAMA) talks.  Such reductions could result in 
increased investment in sporting goods production in 
Morocco, he argued.  Mezouar warmed the atmosphere by 
recalling that Nike had sponsored the Moroccan national 
basketball team on which he played, adding that he had also 
played summer league basketball in Minnesota. 
 
5. (U)  Senator Enzi told Mezouar he was impressed not only 
with Morocco's microcredit programs and efforts to promote 
small businesses, but with the private sector's obvious 
commitment to good labor practices.  Mezouar agreed that 
promoting SMEs was central to the King's commitment and GOM 
efforts to bridge the gap between current reality and the 
global situation in 2005.  Mezouar said the GOM is 
concentrating its efforts on new SMEs which are at the most 
vulnerable in the first few years.  Enzi noted that small 
businesses create jobs and added that simplified rules and 
regulations help businesses big and small.  Mezouar agreed, 
adding that new businesses in Morocco are being created in 
an environment of free markets and competition, not in 
"sheltered waters."  Senator Enzi congratulated Mezouar on 
the GOM's SME efforts, noting that today's small business is 
tomorrow's Nike. 
 
6. (SBU) Minister Mezouar explained the challenges facing 
Morocco.  The GOM is nurturing economic opportunity and 
freedom because together they will accelerate needed 
reforms.  Mezouar noted that the GOM lacks adequate 
resources, capacities, and personnel to realize the full 
range of needed reforms now.  "We know that our friends who 
want us to succeed will want to support us," so that Morocco 
will be a positive example to the region, not a negative 
one.  That said, Morocco remains committed to economic 
reforms, he added.  Mezouar said that economic reforms and 
job creation would take precedence over democratic reforms, 
however.  Senator Enzi, responding to Mezouar's comments, 
agreed that job creation is a more immediate need: "People 
need to have work before they can concentrate on democracy." 
Senator Enzi added that judicial reform was critical to 
attracting foreign investment.  Noting that in his judgment 
Morocco was on the right trend for democracy, freedom, rule 
of law, and economic growth, Senator Sessions conceded that 
Morocco is obviously "taking some chances."  Senator Enzi 
agreed that change is never simple, but it can be done 
without disruption. 
 
7.  (U)  Finally, Mezouar's Chief of Staff Karim Taghi 
shared information on a German shoe company's investment in 
Larache, a city in Morocco's interior.  The investment 
employs 1500 - 400 in a factory and nearly eleven hundred 
who work out of their homes and village community centers. 
There is incredible flexibility in wages, work hours, and 
personnel management, he said.  Taghi suggested that the 
senators might know of interested U.S. investors (not so 
subtly mentioning Nike in Senator Smith's home state). 
 
8.  CODEL Smith cleared this cable.