China’s Hailiang Ventures into Morocco, Proposing a Copper Plant to Serve Western Markets

Zhejiang Hailiang Co., a leading Chinese company is poised to invest $288 million in establishing a battery manufacturing facility in Morocco.

The new production base is set to manufacture new energy materials, including lithium-battery foil, to better serve markets in Europe, America, the Middle East, and Africa.

Morocco appealed to the Chinese giant due to the kingdom’s free trade agreements with many Western countries, including the US, the European Union, and Turkey, which allows better access to those markets, Hailiang tells Bloomberg.

The project will also enjoy low raw material costs given Africa’s rich copper deposits.

The plant’s output of advanced materials for the global new energy supply chain would enhance Morocco’s reputation as an innovative and technologically capable partner, especially within Western markets, a reputation that could lead to further big investments in Morocco, a country heavily reliant on foreign capital.

The new project would be a source of economic growth, technology transfer, human capital development, and job creation.

The construction will take 36 months according to the Chinese company, while the project is expected to produce 50,000 tons of alloy, 35,000 tons of pipe, 40,000 tons of rod, and 25,000 tons of foil a year.

While Europe, particularly France and Spain, remains the primary source of FDI in Morocco, this project presents an opportunity to diversify foreign investments in the Kingdom.

Recent successes in attracting investments from the Arab world, the United States, China, and other regions underscore Morocco’s growing appeal as an investment destination.

Morocco has already welcomed notable Chinese investments in its economic landscape.

Among these, Guchen Hi-Tech’s Lithium-ion Battery Gigafactory and BTR’s Lithium-ion Battery Anode Material Factory stand out as successful ventures that could have paved the way for further collaborations between the two nations.

The Chinese company faces geopolitical tensions impacting its trade and supply chains, it said in a filing on Tuesday to the Shenzhen Stock Exchange.

This is why Zhejiang Hailiang has been tapping overseas markets as margins fall at home amid more restrictions on Chinese products due to rising tensions with Western countries.

This move aligns with the trend of Chinese companies expanding globally to minimize risks associated with trade restrictions and geopolitical tensions.

Notably, last year, Zhejiang Hailiang announced a similar venture—a 50,000-ton lithium-battery copper foil plant in Indonesia—underscoring its commitment to diversifying its global footprint.