Morocco establishes itself as a critical link connecting China to both the United States and Europe, effectively reducing the risk for manufacturers, Financial Times argues.
A new report by the Financial Times argued that one of the leading global battery material producers has cautioned that Chinese firms are refraining from or postponing direct investments in the United States and Europe due to geopolitical concerns and protracted permit approval processes. This warning comes after China’s CNGR Advanced Material announced a $2 billion investment in Morocco.
CNGR Advanced Material of China recently announced its plans to construct a cathode materials facility in Morocco, with the aim of serving the battery markets in the United States and Europe. This unexpected development positions the North African nation as a beneficiary of tensions between the United States and China, as per the report.
Thorsten Lahrs, the CEO of CNGR Europe, Morocco presents an ideal position for Chinese manufacturers seeking to cater to the US and European markets, essentially hitting a strategic “sweet spot.”
Lahrs mentioned that the construction of plants in Morocco can be accomplished at a faster pace than in the intended markets, which entails prolonged permitting procedures. Additionally, investments in Morocco are regarded as lower-risk options, given their adaptability to switch to alternative export destinations in the event of the United States or Europe implementing new protectionist policies.
“Being Chinese means being flexible,” he said as quoted by the Financial Times.