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A high-profile air transport liberalisation deal with the EU has been hailed by many in Rabat as taking Morocco a big step closer to meeting its ambitious tourism development targets. However, others say the deal could end up being a serious challenge to flagship carrier Royal Air Maroc (RAM).

The open skies agreement was signed on December 14 in Marrakech in the presence of Moroccan Minister of Equipment and Transport Karim Ghellab and EU Transport Commissioner Jacques Barrot, who met on the fringe of the first Euro-Mediterranean conference of transport ministers.

The agreement is expected to come into force in 2006, following its ratification by the Moroccan parliament. Morocco already had bilateral aviation agreements with a number of EU states, but analysts generally agree that the open skies deal takes this a step further. Indeed, many argue that such a liberalisation is a prerequisite for Morocco if it is to achieve its Vision 2010 objective of attracting 10m tourists per year by 2010.

At the same time, the deal is seen by the EU as serving its broader objective of a Euro-Mediterranean Free Trade Area, in line with the goals set by the Barcelona process 10 years ago.

Morocco is the first non-European country to conclude such a global air transport agreement with the EU. This reinforces its bid for advanced status in its relationship with the Union - a condition less than accession, but more than its current association status.

While a number of analysts had uttered the view that the deal would simply extend the provisions of the previous agreements Morocco had signed with France and Spain to encompass all EU countries, Ghellab told reporters the deal was comprehensive. It hence abolishes all limitations established by previous bilateral agreements.

The government could have opted for a complete opening three years ago, the minister told the local press. The conditions were conducive, but we decided to think it out thoroughly before making such an important decision for the future of the aviation sector and for tourism development in our country.

The open skies agreement provides for the abolition of all restrictions and limits on nationality, capacity, frequency or routes regarding transport of passengers by European or Moroccan airlines between the EU and Morocco. Moroccan air carriers will be able to fly to and transit from any of the airports in Europe, while reciprocally, all Moroccan international airports will be open to European carriers.

The agreement also provides for a simplification of procedures and for the standardisation of security and safety norms - although Ghellab insisted Morocco was already virtually up to EU standards in this respect.

Regarding the possibility of establishing new companies, a mixed Morocco-EU committee will be in charge of granting new airlines the authorisation to operate on both sides of the Mediterranean.

At the same time, Ghellab made it clear that Morocco's objective was to attract 15m travellers, a necessary condition to reach 10m tourist arrivals each year by 2010, since studies have shown that about two thirds of arrivals are tourists. That would mean doubling the number of arrivals by air, which stood at around 7m in 2004.

The signing of the open skies deal hence fits in the country's tourism development strategy, which aims at strengthening the industry's role as an economic growth vehicle. The government has a development plan to expand and upgrade roads and other basic infrastructure in tourist zones, where hotels and other facilities will be built to accommodate the expected rise in tourist numbers.

Meanwhile, a number of local analysts are already fretting over the impact stiffened competition could have on the national carrier, RAM. As its name indicates, open skies will open up Moroccan airspace to all EU airlines, including no-frills carriers.

However, others suggest that RAM has been gearing up for this liberalisation for several years now, with the establishment of its own low-cost service, Atlas Blue in mid-2004. RAM has also been pursuing a strategy of diversification in its sources of income, with new training, maintenance, security, catering and hotel business programmes.

Nevertheless, it remains to be seen whether RAM will prove able to resist all-out competition, especially on its Paris-Casablanca and Paris-Marrakech lines, which are the national carrier's lifeblood. A first test will take place on the crucial Paris-Marrakech line, with French-based airline Aigle Azur in December opening a new regular flight three times a week at an aggressive launch fare of 99 euros return, plus value-added tax (VAT).

Indeed, many onlookers expect European low-cost carriers such as EasyJet and Ryanair to rush to open Moroccan routes in 2006. Some insiders even whisper that this is the reason why Ghellab visited Dublin earlier this year.

Meanwhile, supporters of liberalisation are emphasising that the fifth liberty, whereby RAM airplanes will be allowed to serve more than one European city at a time, following a first stopover in the EU, could open new opportunities to the Moroccan flagship carrier. Under this provision, it could thus connect Casablanca to London via Paris.

At the same time, continuity of service on domestic lines is another cause for concern, with local travellers hoping increased competition on profitable routes won't lure RAM away from loss-making ones.

Yet most analysts broadly agree that despite the risks borne by its national carrier, Morocco has made the right choice in opening up its aviation sector. As the minister put it, For us, competition is a factor of progress. There is little doubt that by sending such a positive signal to the EU market, Morocco is firmly taking a position as one of the EuroMed zone's most business-friendly nations.