Month: August 2012

Samsung sees smartphones leading Africa growth

Growing African smartphone market becoming important for South Korean electronics giant Samsung.

The Korean maker of televisions and white goods is aggressively courting African consumers with its “Built for Africa” line, which features energy-saving electrical appliances purpose built to withstand high temperatures and erratic power supply.

But the company sees some of its biggest opportunities on the continent from rising demand for cheaper smartphones, Kwang Kee Park, Samsung’s president and chief operating officer for Africa, told Reuters in an interview.

“We intend to grow the smartphone market up to 20% for the next one year’s time with the Galaxy Pocket,” he said, referring to a stripped-down version of its Galaxy smartphone.

Africa is the fastest growing mobile market in the world and will be home to 738-million handsets by the end of this year, according to a survey by industry body GSMA.

The rise of smartphones has also given millions of African internet access for the first time.

Samsung estimates the total African market for handset devices shipped was around 97-million, with smartphone penetration currently around 6% to 8%. Samsung’s share of the smartphone market in Africa stands at about 10%.

Samsung, which had assembly plants in South Africa, Nigeria, Ethiopia, Senegal, Mali and north Sudan, is aiming reach the $3-billion sales mark this year, up $1-billion on last year.

The company has said it aims to boost its revenue from Africa to $10-billion by 2015.

But Park said that would depend on Samsung being able to develop more locally relevant products at cheaper prices. “Every year we can come up with another $1-billion in business,” he said. “But it really depends on how we develop more locally relevant products and make the products more affordable.”

Investing in Africa is sure to pay off for Samsung given that the continent has a growing and expanding middle class.

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Australia-Africa trade rebounds.

Trade between Australia and Africa rebounded according to report by Australian government.

Australian trade with Africa rebounded in 2010, increasing nearly a third over the year to total $8.5 billion. Education services exports to Africa were up over 80 per cent since 2005, to $449 million in 2010. Education is now Australia’s second largest export to Africa, behind only aluminium ores and concentrates.

Australia’s top trading partners in Africa in 2010 were South Africa and Nigeria.

These figures come from a new report, Australia’s Trade with Africa and the Middle East, produced by the Department of Foreign Affairs and Trade.

In the Middle East – where Australia’s merchandise trade is valued at $10.9 billion – education services are also an important contributor to Australia’s export performance, as the fourth highest export behind aluminium ore and concentrates, passenger motor vehicles and wheat.

Australia’s key trading partners in the Middle East in 2010 were the United Arab Emirates and Saudi Arabia. Manufactured products are a key component of Australia’s exports to both Africa and the Middle East.

Exports of manufactures to Africa totalled $1.1 billion in 2010, which is more than a third of all merchandise exports to Africa. These manufactures included pharmaceuticals, civil engineering equipment and specialised machinery.

Exports of manufactures to the Middle East were valued at $2.4 billion and comprised more than a third of the total merchandise exports in 2010. The majority of these manufactured exports were elaborately transformed manufactures (ETMs), underpinned by exports of motor vehicles and vehicle parts and accessories.

Australia is behind in trade volume compared to its Asian neighbors like China, South Korea, Japan and a few others. Australian resource companies are now spending tens of billions of dollars on exploration and development, and ngineering and service companies are clinching billions of dollars of contracts, across Africa. There are already strong mining and resource links between Australia and Africa. More than 150 Australian minerals and petroleum resources companies, around 40 percent have interests in more than 40 African countries, with current and prospective investment estimated at $20 billion. Australia’s minerals and resources companies have more projects in Africa than in any other region of the world.

Australian companies are active in delivering a wide range of world-class mining services – including engineering, consulting and analysis. They enjoy a well-earned reputation for excellent safety records and high environmental standards. They have experience working in diverse multicultural environments, and they apply that expertise all around the world. Australia is an example of how resource development used wisely can deliver wealth for the entire nation.

African nations have an important and growing influence in multilateral fora. They comprise more than a quarter of the membership of the World Trade Organization, the United Nations and the Commonwealth.  For Australia it makes strategic sense to engage with Africa bilaterally, regionally and through the African Union. Whether you look to Europe, the United States, India, Japan or China, the world sees opportunity in Africa and opportunities for Africa in the world.  Australia’s re-engagement is part of this long-term common sense, wider trend. Australia now has diplomatic relations with 51 of Africa’s 53 countries, excluding Guinea Bissau and the Democratic Republic of Congo.  This is compared with 41 in 2007.

Germany and South Africa conclude joint naval exercise in Cape Town

Naval exercises between Germany and South Africa have concluded.

South Africa and Germany yesterday wrapped up the joint naval exercise Good Hope V, which was commanded by South Africans for the first time.

The large-scale exercise between the South African Navy, Air Force and the German Navy takes place off the waters of South Africa on a biennial basis. It is the largest undertaken by the German Task Force Group outside of its NATO obligations.

This year, however, financial considerations and the counter piracy commitments of both navies have meant that Exercise Good Hope V was scaled down when compared to previous years. The aim of Exercise Good Hope V was to conduct exercises that would facilitate the sharing of expertise in general and anti-piracy operations in particular, thus enhancing the SA Navy’s capability in terms of anti-piracy operations within the Mozambican channel.

As Captain Micky Girsa, Commander Combined Maritime Task Group and Commanding Officer of SAS Amatola, explained, “although the global objective of Good Hope exercises between the German and South African forces has always been to conduct joint multi-national exercises focused on conventional warfare, this specific interaction has focused more on the asymmetric threat of anti-piracy.”

“This in itself is a first,” he continued. For Exercise Good Hope V, the German Navy was represented by FSG Lübeck, a frigate returning from Operation Atalanta, the European Union’s Naval Force counter-piracy operation in the Gulf of Aden and Somali Basin. The Lübeck is equipped with two Lynx Mk 88 helicopters and a Marine boarding team.

The Lübeck was to join SAS Isandlwana, the South African frigate involved with anti-piracy operations in the Mozambique Channel (Operation Copper), with the two vessels sailing south from Durban to Simon’s Town together. The Isandlwana is equipped with a Super Lynx maritime helicopter. However, Lübeck’s arrival in Durban was delayed by two days due to tropical cyclone Irene. The crew of the Lübeck had to endure wind speeds of up to 80 knots (150 km/h) with eight metre swells.

The two frigates eventually left Durban on 9 March and performed numerous sea exercises during their passage to the Simon’s Town naval base in Cape Town. These exercises included a strong emphasis on anti-piracy operations. The requirement for such exercises was brought home when, whilst on patrol off Somalia in January, the Lübeck forced Somali pirates to release an Indian dhow with 15 Indian mariners held as hostages.

Other exercises included boarding operations (from both boats and helicopters), Maritime Domain Awareness, simulated anti-ship missile firings and seamanship and manoeuvring exercises. Time was also spent on gunnery from the ships and helicopters.

Boarding teams consisting of Special Forces and Maritime Reaction Squadron personnel from South Africa as well as Marines from Germany. These units operated as mixed teams and according to both South African and German officers, no problems were experienced and all members worked well together.

However, conventional warfare was not ignored because, as Girsa clarified, “this would be foolish on both parts.”

Once they had reached Cape waters, the Task Group was joined by the South African frigate SAS Amatola and submarine SAS Queen Modjadji 1. Together with an Air Force C-47 TP Dakota maritime patrol aircraft, the Task Group undertook numerous anti-submarine warfare sorties for the benefit of the ships, helicopters and submarine. This included engagement of simulated hostile surface vessels found and identified by the Dakota.

“Amongst all the serials mentioned, one of the highlights was the inclusion of a Dipper [Lynx equipped with a dipping sonar],” Girsa espoused. “This profound ability proved to be advantageous and of great value to the combined force, especially the submarine who was tasked to evade detection and engage the force as best as possible.”

This was ably done by SAS Queen Modjadji 1, commanded by Cdr Neville Howell. Operating under home-town advantage, he was able to surprise the German participants by being extremely evasive.

“The submarine gave us a hard time trying to find them!” exclaimed Capt Eike Wetters, commander of the German Navy Task Group. This, he explained, was because the submarine took advantage of the deep water and varying temperatures at different depths.

Wetters said that it was not enough to perform anti-submarine training on simulators as live exercises were required for optimal experience. “From the German side, we are very happy to have…these anti-submarine warfare exercises. You need live exercises with a real submarine.”

Girsa concluded that as proud as he was of the South African forces that were placed under his operational control for this exercise, “I must state that it has been only a pleasure operating with the German ship Lubeck and all her affiliations. They are indeed professional in every aspect and an asset to the German Navy.”

To which Wetters added, “overall, Exercise Good Hope has been of great value, was planned and professionally led by the South African Navy and successfully conducted by all participants.”

Planning is already proceeding for Exercise Good Hope VI, which will be held in 2014.

“Despite financial pressure and training for several other operational commitments, it has been and still is the German Navy’s (commitment)…to maintain the momentum of this exercise series. I stress that because we have had to scale down the German contingent to a lone frigate here, this exercise…has been a success from our point of view, stressing that it is not always the number that counts, it’s the quality of the training,” concluded Wetters.

The South African armed forces continue to improve their capabilities with such interactions and exercises with foreign armed forces.  Such exercises build experience first hand that are hard to stimulate in a controlled environment.

MasterCard Worldwide opens regional headquarters in Nairobi, Kenya.

MasterCard has opened a regional headquarters in Nairobi, Kenya

MasterCard Worldwide, today launched its official East African regional headquarters in Nairobi, Kenya. This development brings the number of MasterCard offices across the African continent to five, with other offices operational in Cairo, Casablanca, Lagos, Johannesburg and now Nairobi.

Prime Minister Raila Odinga of Kenya welcomed MasterCard’s announcement. “We are pleased to welcome MasterCard to East Africa and in particular to Kenya, as we see the region’s growth path continue. MasterCard’s products will see the benefits of inclusion into the financial system extend to many more East Africans, giving them the opportunity to transact electronically with people and companies and so keep their precious money safe and secure, helping to build prosperity for their future.”

“Nairobi’s reputation as an African commerce, trade and development hub made it a strategically sound location for MasterCard to establish its regional headquarters. We believe it is a natural recognition of Kenya’s role as the financial heart of the East Africa region,” says Daniel Monehin, Area Head, East & West Africa and Indian Ocean Islands, MasterCard Worldwide.

The Nairobi office will act as MasterCard’s liaison office for customer banks, business associates and consumers in its main markets of Kenya, Tanzania, Mauritius, Ethiopia and Uganda, as well as across the rest of the East African region, bringing the organisation’s knowledge of electronic payments best practice to these markets.

This will include a significant emphasis in the areas of card knowledge and skills development, advising on development of card acceptance infrastructure, new products, and developing partnerships with ‘technology enablers,’ as well as retailer education and best acceptance practice.

“We are establishing the new Nairobi office as a gateway through which MasterCard will liaise with its existing customers across the East African region. It will also be a launch pad for further expansion across the region, by providing advice to support MasterCard’s ongoing quest to shift consumers from traditional cash payments to non-cash payment systems, so that they can avoid the costs, risks and inefficiencies associated with cash,” comments Monehin.

Bringing the benefits of electronic payments to people across the African continent is a primary focus for MasterCard. “East Africa, and indeed Africa as a whole, has always been heavily reliant on cash – both in the consumer and corporate sectors,” says Charlton Goredema, Vice President and Market Manager for East Africa and Indian Ocean Islands for MasterCard Worldwide. “This dependence is costly – the costs of printing notes and keeping them secure are significant – and cash payments restrict an individual or company’s economic activity to their immediate geographic area.”

MasterCard has already been active in the Kenyan market working with banks and other business organisations to advise on developing payment solutions that are best suited for Kenyans. Most recently, in collaboration with Airtel & Standard Chartered Bank, the world’s first virtual card that operates off a mobile wallet was launched in Kenya.

“PayOnline is a unique virtual card payment solution, developed specifically to address the needs of consumers in Kenya. At the Mobile World Congress 2011 this product was awarded top honours as the Best Mobile Money Product or Solution. PayOnline makes it possible for Kenyan Airtel clients to shop online, even if they do not have a bank account,” says Goredema. “This is just one way that MasterCard products are working to extend financial inclusion to all through the development of solutions that take into account the unique attributes of each local market.”

“MasterCard products make it simple and safe to process electronic payments anywhere in the world,” Goredema points out. “Consumers using electronic payment systems don’t have to worry whether the cash they are carrying is sufficient for their intended purchase, and they do not have to fear for their security, as is common when carrying a large amount of cash on their person.”

In addition, the electronic payments solutions brought to market by MasterCard facilitate transparency in banking, through innovation and security that provide clear transaction records at every step, allowing protection from fraudulent activities. Goredema believes that these solutions are key to the continued success of East Africa’s rapid economic growth.

“MasterCard’s products include debit, prepaid, mobile and credit card payment solutions, which can be used to avoid the pitfalls of cash,” says Goredema. “We have already used these products in a variety of revolutionary applications on the African continent, including prepaid solutions for transport, and the secure disbursement of citizens’ social security payments.”

MasterCard’s global payments expertise will be very relevant across East Africa and particularly in Kenya, as the country evolves to implement the National Payments Systems Bill, passed by the country’s government during 2011.

“We believe that the Bill is a recognition that efficient payment mechanisms are essential to the development of the Kenyan economy, and we look forward to working with policymakers to bring electronic payment solutions to this market,” says Goredema. “We have worked on similar projects across the globe, where we have responded to local needs with products that offer the best of MasterCard’s global experience.”

MasterCard will also be offering the services of MasterCard Advisors into the East African region, helping to ensure that best-practice principles are implemented across the payments network. MasterCard Advisors is the professional services arm of MasterCard that provides payments consulting, information, analytics, and customised services to financial institutions, governments and retailers worldwide.

“We have invested significant resources into understanding East Africa, its business dynamics, how its consumers operate and the unique conditions that make this region one of the most exciting places to do business,” says Goredema. “We realise that there is no one-size-fits-all strategy and each market has its own unique challenges, opportunities and needs. MasterCard has invested extensively in research both on the African continent, and globally, and we are equipped to offer advice on payment industry best practice at every level.

“For MasterCard, the opportunities Africa brings forth will push the payments frontier faster and further than ever before and we continue our vision to realise a world beyond cash, bringing greater efficiencies to the payments system,” concludes Goredema. “We look forward to now working even more closely with our customer financial institutions, businesses and consumers across East Africa to leverage new technologies and innovative payment methods to enable safe, simple and convenient ways for consumers to pay.”

A chance to tap into the growing African consumer market.

North Dakota and Ghana Partnership

Since 2004, the North Dakota National Guard has been paired with Ghana, Africa, as part of the Department of Defense-sponsored State Partnership Program. Through the program, both the North Dakota National Guard and Ghana Armed Forces have benefitted from each other’s experience and knowledge through shared missions, workshops, exchanges and more.

Guardsmen from the North Dakota Air National Guard are very familiar with their Ghanaian military counterparts, in fact North Dakota and Ghana have been state partners for a number of years. Maintenance experts from the 119 Air Wing in Fargo were the natural choice then for the first ever African Partnership Flight. Air Force Staff Sergeant James Stewart introduces us to two North Dakotans who are proud to share their maintenance know-how with their Ghanaian friends and the other nations involved in the African Partnership Flight.

New stock market partnership formed between FTSE Group and the African Securities Exchanges Association (ASEA)

FTSE Group and the African Securities Exchanges Association (ASEA) have joined to form a new partnership for investing.

A new pan-African stock market index being launched by the FTSE Group and the African Securities Exchanges Association (ASEA) will help to improve the visibility of African equities. The FTSE-ASEA Pan Africa Index due to be launched early in the second quarter of 2012, will initially carry stocks from 16 of the 22 ASEA member bourses.  These range from the Moroccan, Nigerian and Zimbabwean exchanges down to Malawi, Botswana and Tanzania.

The frontier and emerging categories of most investment indexes fail to include a representative spread of African stocks: South Africa’s, Mauritius’s and Egypt’s stocks are the most likely to be included. But a backdated test of the new index that examines its performance between 2008 and 2011 shows that it outperformed both the FTSE EMEA Index and its All-World Index.

Companies must have a free float greater than 15 percent to be included on the index, which cannot have more than 30 companies from any one country, nor any one market with weighting greater than 20 percent. There will be two versions: one with and one without South Africa.

Although the final index and its constituent stocks and weightings are subject to change, an initial snapshot presented to the ASEA conference in Marrakech in December showed a total investable market capitalisation approaching $350bn.

The underlying data, including which stocks are indexed and their weightings, will only be available upon subscription.

“This index is without prejudice,” says Jonathan Cooper, managing director for Middle East and Africa at the FTSE Group. “It gives Africa as a whole the opportunity to receive the same focus.”

Initially, FTSE Group expects the index to be used for research and benchmarking purposes but hopes it could soon attract tracker funds. Peter Mwangi, chief executive of the Nairobi Stock Exchange (NSE), argues that this index “should have been done a while back”.

African exchanges are becoming more savvy about the need to package their information and make money selling it to information vendors.

In November, in collaboration with FTSE Group, the NSE launched two new indexes of the 25 most liquid stocks and the 15 largest stocks. Mwangi says they have been well received by international investors.

Investment(s) and investing opportunities loom large in Africa. Contrary to popular beliefs, the risk is how and rewards are high investing in the region. With some knowledge and patience, one is sure to end up with a wise investment.

Flying high in the sky: Morocco’s aviation Industry takes off

The Aircelle plant makes large components for planes.

Morocco’s aviation industry has taken off and spread its wings.

Nassima Boukhriss has never set foot on an airplane, but soon she will be helping wire up some of the world’s most advanced jetliners.

The 22-year-old vocational student is participating in one of North Africa’s most ambitious economic-development efforts: starting an aerospace industry. Across Morocco, millions of people lack jobs, basic education and even running water. Manufacturing remains a small part of the economy compared with agriculture and tourism. Low-skilled textile work is one of the biggest sectors.

At a school near Casablanca, students are learning skills that they hope will win them high-paying jobs in Morocco’s growing aerospace industry.  Yet over the past decade, Boeing Co.,Safran SA of France and other leading aviation companies have built increasingly sophisticated factories in this kingdom.

As revolutions swept neighboring countries last year, aerospace giantsUnited Technologies Corp. andBombardier Inc. unveiled investments of more than $200 million in new Moroccan factories.

To ensure they have qualified staff, the government and an industry group in May opened the Moroccan Aerospace Institute, or IMA, the vocational school Ms. Boukhriss attends.

The result is that the aviation industry now employs almost 10,000 Moroccans who earn about 15% above the country’s average monthly wage of roughly $320.

Moroccan officials are betting that by leapfrogging into advanced manufacturing like aerospace and electronics, the country can attract more basic industries in their wake.

Morocco’s Aerospace Gambit

Over the past decade, leading aviation companies have built increasingly sophisticated factories in Morocco, as local officials hope this push into advanced manufacturing can attract more basic industries in its wake.

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Workers at Le Piston Francais. The French aerospace component producer was one of the first contractors to arrive in Morocco.

“When you succeed in aerospace, you can succeed in other industries,” said Hamid Benbrahim El-Andaloussi, president of Morocco’s aerospace trade group, Gimas.

That hasn’t happened yet. Manufacturing’s share of Morocco’s economy has shrunk over the past decade. The country has joblessness of roughly 30% among both young and well-educated people—the same groups that helped lead revolts in Egypt and Tunisia.

The upheaval of the Arab Spring has put new urgency on showing Morocco’s aerospace gambit can deliver. King Mohammed VI last March neutralized protests by offering a more democratic constitution and fresh elections, which proceeded peacefully in November. But for Morocco to remain calm, analysts say, it must create jobs.

“High unemployment is at the center of what’s going on in the region,” says Karim Belayachi, a private-sector development specialist at the World Bank.

Morocco’s push into commercial aeronautics is unusual among developing economies. Brazil, Indonesia and South Africa in the last century developed military aerospace companies, but only Brazil’s privatized Empresa Brasileira de Aeronáutica SA successfully shifted to building passenger planes. Today, it is a national bellwether. Mexico has recently drawn aerospace component producers, but they remain a small part of its economy.

Many more countries have expanded with technology and automotive investments, as Morocco is also attempting. Taiwan, South Korea and Slovakia relied on foreign or state-supported investments, mixed with entrepreneurialism, for economic growth. But those countries fostered regulatory climates more friendly to start-ups than Morocco has achieved and could tap skilled work forces. Education in Morocco lags behind its economic peers, according to the World Bank.

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Morocco’s aerospace development started in 1999 with a nudge from Mr. Benbrahim at Gimas, who was then a senior executive at Boeing’s longtime customer Royal Air Maroc. He and other officials at the national carrier urged the U.S. giant to invest in Morocco as a sign of good faith.

“There was push-back within Boeing,” among executives who deemed an investment unnecessary, recalls Seddik Belyamani, who was then Boeing’s top airplane salesman and was born in Morocco.

But the Moroccan links and a desire to fend off rival Airbus prevailed. Boeing, the airline and French electrical-wiring company Labinal SA in 2001 opened a small operation preparing cables for Boeing 737 jetliners, named Matis. Staff painstakingly prepared wire bundles and shipped them to Boeing plants in the U.S. for installation.

The labor-intensive work entailed no technical background, yet Boeing managers still initially expected to achieve efficiency of only 30% of industry norms. To their surprise, staff hit 70% efficiency within two years, recalls Mr. Belyamani, who retired from Boeing in 2002 and recently was appointed chairman of Matis.

The results impressed executives at Labinal, which in 2000 had been acquired by the French aerospace group now called Safran. Managers saw that as Matis grew, job openings attracted floods of highly educated applicants. More than 80% are women, who have limited job opportunities in traditional industries.

The only foreigner among 700 Matis staff today is the French general manager, Sébastien Jaulerry, who previously worked for Labinal in the U.S. and France. Walking through the spotless plant recently, he said employees achieve “exactly the same standard” of quality as at his previous plants.

Around him, Matis staff prepared wires not just for Boeing but also for General ElectricCo. engines, Dassault Aviation SA business jets and even Airbus jetliners. The most visible difference from more established aviation shops was the large number of women in head scarves.

Safran, encouraged by results at Matis, expanded into more advanced manufacturing. In 2006, its Aircelle division opened a plant making jet-engine housings. The work, which includes machining advanced plastic composites and assembling safety-critical structures, mirrors operations at Aircelle plants in France and Britain. Product quality is also comparable, say Aircelle executives.

Today, Moroccan officials highlight aerospace as a success within the country’s larger economic modernization drive, dubbed “Emergence.” Other projects include a giant Mediterranean port complex and tax-free zone at Tangiers, where French car giantRenault SA recently opened a big factory.

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Yet despite Morocco’s big push to create export-oriented jobs, manufacturing’s share of the economy is shrinking, says Lahcen Achy, an economist with the Carnegie Endowment for International Peace, in Morocco’s capital, Rabat. He calculates manufacturing now stands at roughly 15.6% of gross domestic product. The World Bank pegged it at 19% of GDP in 1995.

Moroccan manufacturing growth hasn’t kept pace with tourism and other service businesses. A major reason, economists say, is the headaches that domestic entrepreneurs face. Mr. Belayachi at the World Bank notes that Morocco’s judicial system reports to the royal palace and isn’t an independent arm of government, which undermines its reliability. “Enforcing a contract is lengthy and difficult, which has a big impact” on small businesses, he said.

Moroccan officials say they have made other efforts to help business, including recent anticorruption legislation and the creation in 2009 of a Central Authority for Corruption Prevention.

Analysts say that as a result of impediments to business, local entrepreneurs haven’t piggybacked foreign investors as extensively as domestic producers in developing countries of Asia and Eastern Europe.

Ahmed Chami, a member of parliament who served as Morocco’s minister of industry until recently, said foreign investments are starting to bear fruit and “spillover will happen.” The lack of local aerospace businesses is “the weakness in the picture today and should be the next focus,” he conceded.

Boosters of Moroccan aerospace say the growing number of foreign suppliers indicates the sector will go local. One of the first contractors to arrive was Le Piston Français, an aerospace component producer based in Toulouse, France, near the Airbus unit of European Aeronautic Defence & Space Co. Director Vincent Fontaine says the company was drawn to Casablanca in 1999 by sales opportunities and government incentives, such as tax breaks.

The plant has grown to 110 employees from about 25 and is adding new customers, such as Bombardier, Mr. Fontaine said. Aerospace materials, like advanced alloys, are also getting easier to buy locally, marking “a big step for industrial development,” he said.

But other investors have faced a bumpier ride. Baccarat Precision, a French family-owned aerospace contractor, started making pistons for jetliner brakes near Casablanca in 2007. Soon after, it landed a giant order for explosive devices that blow open airplane doors in emergency evacuations. The complex cylinders, made of 40 precisely machined elements, must be assembled in a clean room to keep pressurized nitrogen from escaping.

When production began in 2008, managers rejected every second cylinder due to production flaws. “Machinists in Morocco have never seen pieces like this,” said local manager Giancarlo Zanfonato, holding one of the hand-size metal devices. He eventually realized that compared with seasoned French workers, his Moroccan staff needed twice the documentation, including pictures detailing every production step.

After intense efforts to educate machinists, the rejection rate has shrunk below 10%, yet remains far above the target of 2%, Mr. Zanfonato said. The project, which was expected to break even within one year, remains unprofitable. “We are a small company and this project was much too ambitious for us,” he said.

Mr. Zanfonato sees a hopeful sign in the creation of IMA, the vocational school, which will graduate several hundred students annually. The center is a partnership between the government, which contributed the land and buildings, and the industry group, Gimas. Its members organize and sponsor training, modeled on French standards, for their new hires. Students spend up to 10 months alternating two-week stints at IMA, where many live in dormitories, and on their new jobs.

Demand for graduates is so strong that companies are pressing for two shifts of classes, said IMA Director Annie Lagrandeur recently, as students practiced wiring and machining in the school’s shop. Nearby, others attended lectures given by veteran aerospace workers whom IMA hired from local plants for their expertise.

Before IMA, foreign aerospace investors were paranoid about rivals poaching their few skilled employees, Ms. Lagrandeur recalled. Some companies even forbade their local staff from riding together on shuttle buses out of fear they might try to recruit each other.

IMA and similar industry-led vocational schools that Morocco has established in the automotive and other industries are “leading-edge in the region,” says Anthony O’Sullivan, head of the Organization for Economic Cooperation and Development’s private sector development division in Paris. Morocco’s overall educational development lags many of its neighbors, and he says “one of the best ways to fill the gap is to have companies involved in training.”

Within three months of IMA’s opening in May, roughly 1,200 aspiring students had delivered resumes to the front gate, and more sent in applications, said Ms. Lagrandeur.

“It’s a great opportunity because we learn very technical skills in electronics,” said Ms. Boukhriss, the student. Classmate Said Ouchen added he is proud Morocco is developing an aerospace sector and has remained stable over the past year. “Morocco is an example,” he said.

Africa needs more manufacturing.  Morocco should be applauded for crafting such an industrial policy. Not only is the policy attracting foreign investment, workers locally are being trained and gaining valuable experience in the highly skilled profession of aerospace.