Dulcinea chocolates are so popular in Morocco that, until the closure of the border crossings with the Spanish enclaves of Ceuta and Melilla in 2020, smugglers used to sneak them into the country. Since then, to meet Morocco’s growing demand for chocolate, the Spanish company has been investing in local production.
Dulcinea opened its Moroccan factory in the coastal city of Tangiers in 2020, starting with the manufacture of chocolate spreads. Plans to invest further were initially delayed by the pandemic. But the fundamental challenge has been to develop the business, despite the high cost of the raw material for chocolate in this North African country.
“We didn’t set up the company in Morocco as a cost-saving venture,” says Jose Miguel Cañada, who became General Manager of Dulcinea Morocco in 2023. “The decision to scale up was driven by a desire to better serve local customers and expand to other African and Middle Eastern countries.”
Dulcinea’s Moroccan factory must import most of its raw materials from suppliers in Spain, even though that entails transport and customs costs. That’s because most of the ingredients for chocolate, such as cocoa, milk powder and sunflower oil, are expensive in Morocco. Packaging, however, is mostly local. However, the company is taking steps to source the main raw materials from local suppliers by signing partnership agreements with companies in Morocco.
Local currency loans for Moroccan businesses
Dulcinea’s expansion, which includes a new production line for chocolate bars, was financed with a €450 000 working-capital loan from the European Investment Bank’s Tajawouz initiative. The initiative, set up with CaixaBank of Spain and sponsored by the European Union, is the European Investment Bank's first local-currency lending programme in Morocco. It aims at improving access to finance for small and medium-sized enterprises in the country. A grant from the European Union ensures good interest rates for borrowers like Dulcinea and helps reduce the company’s hedging costs.
The “Dulcinea” brand is gradually becoming a household name in Morocco. The Tangiers factory had a turnover of 50 million dirhams (€5 million) in 2023 and already employs 50 people. The Moroccan company is the smallest offshoot of Grupo Lacasa, a mid-cap with a €220 million revenues in 2023 that employs more than 1.000 people, mainly in Spain, where it also has 75% of its turnover, while the rest comes from exports to more than 60 countries around the world.
Community impact
The company has an ambitious investment plan in Morocco. Two new production lines are planned for 2024, with the first one to be set up in September. These lines will each create 10-15 new jobs. A third line is expected in early 2025.
Abdallah Ben Dijah, who has been a manager at the factory since its foundation, says: “Now, instead of producing one single product, hazelnut spread, we have a range of products, such as chocolate tablets, cocoa drink powder, chocolate drops and other chocolates. The new line is ready to produce many different shapes and sizes of chocolates.”
MOROCCO TAJAWOUZ LOAN FOR SMES&MIDCAPS
The operation proposed will provide funding to small and medium-sized enterprises and mid-caps through credit lines to local financial intermediaries, primarily second tier banks. The loans could be provided in local currency.
