Morocco’s Defence Industry Ambitions Face Cost, Skills and Investment Challenges

Morocco is laying the groundwork for a domestic defence industry, seeking to reduce its dependence on foreign suppliers by expanding local manufacturing, aircraft maintenance and drone production. However, the transition from industrial infrastructure to sustainable military production will depend on overcoming financial, technical and workforce constraints, according to a report published in October 2026.

Titled The Moroccan Defence Industry, the study was jointly produced by Germany’s Konrad Adenauer Foundation and the Global Governance and Sovereignty Foundation. It examines the opportunities emerging from Morocco’s defence manufacturing framework while highlighting the obstacles that could limit its development.

Rather than building an entirely new industrial base, Morocco is looking to adapt capabilities already established in its automotive, aerospace and technology sectors. The strategy offers a starting point, but military production comes with stricter certification requirements, specialised technical demands and commercial conditions that differ significantly from those of civilian manufacturing.

A legal framework for domestic military production

A key milestone came in July 2020, when Law No. 10.20 established a framework allowing private companies to manufacture military equipment, weapons and ammunition under regulated conditions.

The legislation introduced licensing procedures, security requirements and export controls. It also established rules governing foreign investment and encouraged technology transfers associated with major arms purchases.

The framework covers three broad areas: weapons and major military platforms, including armoured vehicles, artillery, warships and combat aircraft; electronic equipment for communications, surveillance and sensing; and maintenance, technical support and logistics.

These provisions created a legal basis for domestic production, but turning that framework into a competitive industry requires companies to invest in specialised equipment, secure contracts and develop expertise that meets military standards.

Two industrial zones designed to attract investors

Morocco is also developing dedicated infrastructure to encourage private-sector participation in defence manufacturing. Two planned industrial zones, managed through the Defence Industrial Zones Management Company (SGZID), cover a combined area of 675 hectares.

The initiative brings together the Military Housing and Equipment Agency and MEDZ, an industrial development subsidiary of the state-owned Caisse de Dépôt et de Gestion (CDG).

The first zone, covering 75 hectares in Nouaceur near Casablanca, is intended to support aircraft maintenance, avionics and related activities. The second, spanning 600 hectares in Sidi Yahya du Gharb, in the Rabat region, is designed to accommodate heavy industry and ammunition manufacturing.

The sites are intended to provide licensed companies with equipped industrial facilities, customs arrangements and access to tax incentives available under Morocco’s Investment Charter. Their proximity to established aerospace and automotive businesses could also facilitate access to suppliers, infrastructure and technical expertise.

Decree No. 2.24.1030 formally established SGZID in June 2025, building on the wider regulatory framework introduced in 2020.

Nevertheless, industrial space and financial incentives alone will not guarantee the emergence of a viable defence sector. Companies must also see sufficient long-term demand to justify the cost of entering a highly regulated market.

Aircraft maintenance offers an early route to growth

Aircraft maintenance, repair and modification stand out as one of the most immediate opportunities identified in the report. Keeping military equipment operational over its service life can be extremely costly, making local maintenance capacity a potential way to reduce reliance on overseas facilities.

A central project in this strategy is a 15,000-square-metre facility at Benslimane Air Base, developed through the Maintenance Aero Maroc (MAM) initiative. The project involves US defence company Lockheed Martin, Sabena Aerospace, part of the Blueberry Group, and MAM.

The facility is intended to support maintenance, repair and modification work on F-16 fighter jets and C-130 Hercules transport aircraft operated by Morocco’s Royal Armed Forces.

Beyond servicing the national fleet, the project could help build the technical expertise needed to serve other African military operators. The report identifies this initiative as a potential first step towards establishing Morocco as a regional centre for military aviation maintenance.

Such work could also help domestic engineers and suppliers gain experience in quality assurance, specialised repair techniques and stringent military certification processes before moving into more complex manufacturing activities.

Small drones could open the door to local innovation

Small unmanned aerial vehicles represent another potential entry point for Moroccan manufacturers. Compared with major military platforms, these systems may offer opportunities for local companies to develop products using commercially available electronics and existing industrial capabilities.

According to the report, Moroccan firms could design, assemble and adapt drones for surveillance and tactical applications without having to manufacture every specialised component themselves.

The use of commercially available components that fall outside the scope of the United States International Traffic in Arms Regulations (ITAR) could also reduce certain export-licensing constraints. However, applicable US and other national export-control rules would still need to be respected, depending on the components, technology and intended markets involved.

Developing domestic expertise in drone design and integration could allow manufacturers to adapt systems to operational requirements while building knowledge in electronics, software and production engineering.

The opportunity is consistent with Morocco’s broader industrial strategy, which seeks to build on civilian manufacturing capabilities rather than develop every defence technology independently.

High costs threaten private-sector participation

Despite these opportunities, the report identifies the economics of military manufacturing as a major obstacle.

Morocco’s automotive and aerospace industries have already developed supplier networks and technical capabilities that could be adapted for defence production. The aerospace sector alone includes more than 140 companies, according to the background material accompanying the study.

However, civilian manufacturers cannot necessarily transfer their existing operations to military production without substantial investment.

Companies may need to modify production lines, introduce additional security measures and obtain specialised certifications. These expenses can be difficult to recover when military contracts involve relatively small production runs compared with the large volumes typical of the automotive industry.

The uncertainty surrounding future orders presents another challenge. Without predictable demand, companies may hesitate to invest in dedicated facilities, specialised machinery and long-term workforce development.

The report therefore highlights the importance of creating conditions in which businesses can assess the commercial viability of defence projects before committing significant resources.

Shortage of skilled engineers adds pressure

Human resources represent a second major constraint. Morocco must develop a larger pool of engineers and technicians with expertise in military systems, precision manufacturing, electronics and specialised maintenance.

Competition for qualified workers is already strong, particularly from established automotive and civilian aerospace companies. The departure of Moroccan engineers to opportunities abroad further complicates efforts to retain technical talent.

The study recommends specialised training programmes and clearer professional development pathways to encourage engineers to enter the defence sector and remain in the country.

Building this workforce will require more than recruitment. Companies also need opportunities to train employees through practical projects, technology transfers and sustained industrial activity.

Without sufficient technical expertise, even well-equipped facilities could struggle to meet the demanding quality and reliability requirements associated with military equipment.

A proposed agency to connect industry and the armed forces

The report also calls for a dedicated institution to coordinate the needs of the Royal Armed Forces with the production capabilities of domestic companies.

Modelled on France’s General Directorate for Armaments (DGA), the proposed body would serve as a permanent link between military planners and manufacturers.

Its responsibilities could include translating operational requirements into clear industrial specifications, coordinating procurement priorities and supporting the development of testing and certification facilities.

This approach would help companies understand the military’s technical expectations before investing in production. It could also improve coordination between procurement decisions, industrial planning and the development of domestic expertise.

The report further suggests that the Royal Armed Forces could gradually increase purchases from Moroccan suppliers, giving local businesses opportunities to learn military production standards and demonstrate their capabilities.

Such an approach would need to balance industrial development objectives with the armed forces’ requirements for reliability, performance, security and cost-effectiveness.

From industrial foundations to a sustainable defence sector

Morocco’s ambitions extend beyond manufacturing individual components. The long-term objective is to establish a defence industrial base capable of meeting selected domestic requirements, maintaining military equipment throughout its service life and eventually competing for international contracts.

Achieving that objective will depend on the interaction of several factors: an effective regulatory framework, sufficient private investment, reliable procurement commitments, technology transfers and a skilled workforce.

The industrial zones in Nouaceur and Sidi Yahya du Gharb provide a physical foundation, while projects such as the Benslimane maintenance facility offer opportunities to develop practical expertise.

However, the decisive test will be whether Morocco can turn these initial investments into a steady flow of industrial activity. High adaptation costs, limited order volumes and competition for engineers could slow progress if they remain unresolved.

The report’s central message is that establishing a domestic defence industry requires more than factories and legislation. It demands sustained coordination between the state, the armed forces, investors and manufacturers, alongside a procurement strategy that gives local companies a credible path towards long-term growth.