Aziz Akhannouch, Head of Morocco’s Government, Expands Business Holdings to Include Water!

BY: Hana Saada

ALGIERS- Once again, Aziz Akhannouch, the head of Morocco’s government, exemplifies the clear intersection of wealth and power in the country. He has secured a major contract for the construction of the largest seawater desalination plant, dedicated to supplying the Casablanca-Settat region with drinking water and irrigating extensive agricultural areas. This deal highlights Akhannouch’s influence not only as a competitor but also as part of the ruling elite.

According to Moroccan newspaper Zaiocity, this project, although the latest manifestation of Akhannouch’s financial interests through his companies affiliated with the AKWA Holding Group, is just one facet of his control over Moroccans’ needs. His dominance extends to various aspects of their lives in a time when rising costs have become synonymous with the government he leads.

Monopolizing Water for Casablanca Residents

Akhannouch’s involvement in the Casablanca desalination plant is not new or surprising. Previous reports revealed that he was not merely a competitor but a key player in deciding its fate, given his position as the head of the government representing the region involved. He was present during the initial selection phase of the three alliances out of six contenders.

The project was presented through the Spanish company “Acciona,” with Akhannouch’s financial interests represented by “Afriquia Gaz,” a subsidiary of the AKWA Holding owned by his family. Additionally, “Green of Africa,” a company with shared ownership between “AKWA” and Moroccan businessman Othman Benjelloun’s “FinanceCom,” and “Sofinam” were part of the alliance. The total cost of the project, as indicated in the proposal, is $989 million for construction work alone.

In practical terms, this project places the drinking water for seven million Moroccans directly under Akhannouch’s control. The plant is set to produce 548,000 cubic meters of water in the first phase starting in 2026, with production increasing to 822,000 cubic meters in the second phase by 2030. The plant, to be located in Sidi Rahal, 40 kilometers from the economic capital, will be the primary source of water for the cities of Casablanca, Settat, Berrechid, El Jadida, and Azemmour. It will also ensure the irrigation of 5,000 hectares of agricultural land.

Controlling the Air Before the Water

Before venturing into the water sector, Akhannouch had already established a monopoly on “air” through AKWA Holding’s subsidiary, “Morocco Oxygene.” This company exclusively distributes medical oxygen to Moroccan hospitals, profiting significantly from the health needs of Moroccans. The financial results for 2022 indicate substantial profits, with transactions amounting to MAD 291 million, a 6.2% increase from 2021. The company also invested MAD 19.5 million, primarily in oxygen cylinders, cooling equipment, manufacturing units, and spare parts.

It’s noteworthy to examine the company’s performance in 2020, a year marked by the peak of the COVID-19 pandemic, resulting in economic downturns for many businesses. However, Morocco Oxygene seemed to benefit from the health crisis and associated lockdowns. The company achieved MAD 248.4 million in transactions, a 3.34% increase from the previous year. Its investments rose from MAD 18.5 million in 2019 to MAD 31.7 million in 2020.

Given these circumstances, the parliamentary group of the Moroccan Justice and Development Party requested an opinion from the Competition Council in mid-2022 regarding the adherence of actors in the oxygen and medical gas sector to the conditions of fair competition. The group called for an investigation into suspicions of Morocco Oxygene’s involvement in “dominance and collusion to raise prices.” However, the House of Representatives rejected the referral of this request to the Competition Council.

Akhannouch’s Control Over the Fuel Sector Raises Concerns About Conflict of Interest

While Aziz Akhannouch continues to extend his influence over various sectors in Morocco, his grip on the fuel industry remains a significant concern for Moroccans. As the head of the government and through his family company “Afriquia,” he is a major player in the fuel sector, directly impacting fuel prices—the most crucial aspect of Moroccans’ daily lives. According to a report by the Competition Council on petrol and gasoline prices in September 2022, Africa was responsible for 21.2% of imports from 2018 to 2021. Together with “Vivo Energy,” which owns “Shell” and “Total Energy Morocco” stations, they monopolize 52.7% of total imports.

Moroccans are far from satisfied with “Afriquia,” accusing the company of dramatically raising prices since the liberalization of fuel prices in 2015. The company gained particular attention when a parliamentary committee’s 2018 report revealed that companies made an extra profit of MAD 17 billion beyond their natural profits from late 2015 to May 2018.

The Moroccan Competition Council’s findings on “Afriquia” also raise questions about the dual role of Akhannouch as both a businessman seeking maximum profits and a prime minister expected to prioritize public interest and the welfare of Moroccan citizens. The 2022 report indicated that the company’s net profits were MAD 416 million in 2020, during the global oil price collapse due to the COVID-19 pandemic, and increased to MAD 497 million in 2021. In response, the Council recommended imposing an exceptional tax on excessive profits of companies involved in importing, storing, and distributing gasoline and petrol. However, the recommendation was not implemented.

Conflicting Interests Haunt Akhannouch

The issue of the Casablanca desalination plant raises legal, political, and ethical questions about Akhannouch’s assumption of the prime minister’s position. While this question has been raised since his entry into the government in 2007 as the Minister of Agriculture and Fisheries, it has gained more urgency now since his current position makes him responsible for all sectors. The Moroccan parliamentary session on the past Monday witnessed a heated debate between members of the opposition Justice and Development Party and the ruling National Rally of Independents, which Akhannouch himself leads, regarding “conflict of interest.”

Supporters of Akhannouch refer to a statement issued on September 13, 2021, following his appointment as the prime minister, stating his intention to “completely withdraw from all management positions within the family holding.” The statement claimed that, since his first term as minister, he had halted all professional or commercial activities, particularly involvement in managing facilities belonging to the family holding.

However, critics argue that Akhannouch is embroiled in a “conflict of interest.” The head of the parliamentary group of the Justice and Development Party, Abdoullah Bouano, stated that while the constitution guarantees property rights, freedom of initiative, and entrepreneurship, it also punishes violations related to conflicts of interest, abuse of power, and monopolies. He referred to the Casablanca desalination plant deal as a “political scandal and a dangerous development in the field of finance and business in Morocco,” suggesting a blatant conflict of interest that violates constitutional provisions.