Morocco is the foreign direct investment (FDI) success story of the Maghreb, despite being both smaller and less hydrocarbons-rich than its neighbour Algeria.

Last year, Rabat was Africa’s third-largest recipient of FDI. The 67 projects it attracted accounted for 9.1 per cent of all new schemes in Africa and 9.5 per cent of all jobs created.

FDI in Morocco rose in 2014 for the fourth year in a row, reaching $3.6bn, up from $3.3bn in 2013. Greenfield projects rose from $2.5bn to $4.6bn, in sharp contrast to Algeria, where they plummeted from $4.3bn in 2013 to $536m last year.

While the vagaries of a volatile oil economy might shoulder some of the blame for this difference in fortunes, the main reason Morocco is seeing more FDI is that it is more welcoming.

Despite reforms, Algeria is clinging defensively to its 49:51 rule prohibiting majority foreign ownership, while the Agence Marocaine de Developpement des Investissements sees foreign investors as allies in diversifying and modernising production and lifting employment. In addition to fewer barriers to entry, from a security point of view, Morocco is regarded as the safest and most stable economy in North Africa.

Much foreign investment has been targeted on service sectors, but the past seven years has also seen ongoing investment in industry, particularly automotive and aeronautics, with Morocco seeing factories opened by France’s Renault in 2012 and Canada’s Bombardier last October. FDI has increased in offshoring, renewable energy, agro-food and textiles as well.

As Morocco welcomes foreign firms, which bring investment, jobs and diversification, Algeria needs to look to its neighbour and learn from those successes.