Morocco

Capital: Rabat

Local time:
It is %T:%M %A in Rabat

Exchange rate on :

GDP growth rate: 4.9% in 2013

FDI stock: 42 023 million USD in 2010

Country risk: See the country risk analysis from Morocco provided by Ducroire.

Economic trends

During the last few years, the Moroccan economy has been characterized by macro-economic stability, coupled with low inflation and a relatively slow economic growth. Estimated at 4.8% for 2011, growth should slow down slightly in 2012, to 4%, sustained by domestic demand and the vigorous non-agricultural sector. A decline in demand from the eurozone, the main market for Moroccan exports, will have a negative effect on the country's growth.

A movement of popular protest emerged in Morocco in 2011 under the effect of the Tunisian revolution, prompting the government to increase social spending. In January 2012, Prime Minister Abdellilah Benkiran presented the government's program: strengthening the Moroccan identity, strengthening the rule of law; aiming for strong economic growth, reducing unemployment to 8% by 2016; maintaining the inflation rate to 2%; promoting social equality by improving access to education, health, housing and strengthening the welfare state; developing good relations with foreign countries and strengthening ties with Moroccan emigrants. Stimulating tourism after the attacks in Marrakesh in April 2011 and developing solar energy (Desertec) are also among the priorities.

Unemployment (9%) has been rising in the recent years and affects particularly the young (15-24 of age) and young graduates. The rate of poverty remains one of the highest in the Mediterranean region, with 15% of the population living under the poverty line.

Main branches of industry

Thanks to the richness of Morocco's soil, the agricultural sector is dominant, employing  almost half of the active population and contributing around 20% to the GDP. Grains, fruits and vegetables are the country's main crops. Economic growth relies excessively on this sector.

Morocco has little by way of mineral resources; phosphates being its main wealth. Industry contributes around one-third of the GDP, thanks to the textiles, leather goods, food processing, oil refining and electronic assembling sectors. New industry areas are nevertheless booming as well and thus trying to diminish the kingdom's dependence on its agricultural sector: the chemical, automotive, computer, electronics nad aeronautic industry.

The tertiary sector contributes around 50% of the GDP and depends exclusively on tourism, which remains very dynamic despite the economic slowdown brought about by the attacks of September 11, 2001 and those of May 2003 in Casablanca. Other than granting concessions for a lot of public services in the major towns, the country recently liberalized oil and gas exploration regulations. Calls for tender procedures have become increasingly transparent.

International trade

Morocco has an open economy, trade representing over three quarters of the GDP (average 2008-2010). The main trading partners are France and Spain. The country mainly imports crude oil, telecommunications equipment, wheat, gas and electricity. It mainly exports textiles, electrical components, fertilizers, citrus and vegetables.

In 2011, Morocco's foreign trade recorded an increase of over 18% compared to 2010. This increase is mainly due to higher exports of phosphates and derivatives (an increase of 35% in one year) and cars (63.8%), but also to soaring oil prices on international markets. According to the Moroccan Exchange Office, during the period of November 2010 - November 2011 imports in fact rose more quickly (19.7%) than exports (15.4%). Therefore, Morocco's trade balance has been negative for several years, which only exacerbates the fall in the kingdom's foreign exchange reserves. In 2011, the trade balance reached a record level (+25.2% on 2010), due to the increase in spending on energy and cereals.

The authorities are trying to address the trade deficit through a series of sectoral plans: "Emergence" for the industry, "Green Morocco" for agriculture and Morocco Export Plus, which aims to triple the volume of exported goods and services over the next ten years.It should be noted that free trade accords were signed in 2004 with the United States, Turkey, Tunisia, Egypt and Jordan.