Economy
From The Report: Morocco 2014
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In 2013, Morocco rebounded from a more modest performance in 2012 to deliver 4.4% GDP growth, with the economy bolstered by a return to form in the primary sector thanks to a productive harvest. After 2.7% growth in 2012, economic activity in Morocco expanded much faster in 2013, increasing by 4.4% as GDP reached Dh864.6bn (€76.8bn). This was driven in large part by the agricultural sector, which typically represents 15-20% of GDP, and contributes significantly to both rural employment and exports. The kingdom did have to grapple with its fair share of exogenous challenges – such as low external demand and high commodity prices – as well as domestic complications including a fiscal deficit and unemployment, but following the government reshuffle in mid-2013 the prospects look far more positive. With the 2014 budget setting a more dynamic tone as the government takes steps to redress key fiscal imbalances, there are strong indicators pointing to the economy’s ability to continue to grow. This chapter contains interviews with Mohamed Boussaid, Minister of Finance; Jacques Attali, President, PlaNet Finance; Nicole Bricq, Former French Minister of Foreign Trade; and Zahra Maafiri, Director-General, Maroc Export.

Articles from this Chapter

Overview

Bucking the trend: A strong performance in the face of external challenges bodes well
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For many countries in North Africa, 2013 was not an easy year, with continuing volatility at home and underwhelming growth in Europe, its primary trade partner. Morocco, however, was very much an exception. The country rebounded from a more modest performance in 2012 to deliver 4.4% GDP growth, with the economy bolstered by a return to form in the primary sector thanks to a strong harvest. The kingdom did have to grapple with its fair share of exogenous challenges – such as low external demand and high commodity prices – as well as domestic complications including a fiscal deficit and unemployment, but following the government reshuffle…

Interview

OBG talks to Mohamed Boussaid, Minister of Finance
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Interview:Mohamed Boussaid To what extent has the precautionary credit line from the IMF protected the Moroccan economy from exogenous shocks? MOHAMED BOUSSAID: First, I would like to highlight that the awarding of the precautionary credit line to Morocco should be viewed as a vote of confidence. The IMF has reaffirmed its trust in the kingdom, which is currently undertaking structural reforms to put the public finances on a firmer footing. Thanks to proactive and responsible policies, the…

Interview

OBG talks to Jacques Attali, President, PlaNet Finance
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Interview:Jacques Attali What impact have microfinance institutions (MFIs) had on rates of financial inclusion? JAQUES ATTALI: In Morocco, MFI customers are not taken into account for the purposes of calculating the country’s rates of financial inclusion. In fact, solely the act of opening a bank account in the traditional banking sector counts towards those statistics. Barred by regulations from taking deposits, certain MFIs have instead sought to promote financial inclusion among young…

Analysis

Eyes on all horizons: A concerted effort is being made to boost trade volumes
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Historically referred to as the land behind the beyond, or the land at the end of the world, Morocco has long capitalised on its location between Europe, the Middle East and Africa. The kingdom has in recent years begun to try to position itself as a gateway to West Africa, strengthening bilateral ties with countries such as Gabon and Côte d’Ivoire, but there is a more immediate attraction for investors: the existing free trade agreements (FTAs) that provide access to 55 countries with more than 1bn customers, who between them generate 60% of global GDP. With its traditional primary trade partner Europe still grappling with economic difficulties,…

Interview

OBG talks to Nicole Bricq, Former French Minister of Foreign Trade
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Interview:Nicole Bricq How can France remain a competitive trade partner for African countries? NICLOE BRICQ: Africa is not a uniform block where demand is the same for all countries. Every country is different, and they each have their own expectations. Therefore trading partners should take an individual approach and adapt accordingly. Growth in South-South trade is a hard fact. About half of Sub-Saharan Africa’s exports are destined for emerging and developing countries, against less…

Interview

OBG talks to Zahra Maafiri, Director-General, Maroc Export
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Interview:Zahra Maafiri How should the National Pact for Industrial Emergence be extended to boost exports to the EU? ZAHRA MAAFIRI: At the beginning of its industrialisation process, Europe was Morocco’s natural main trading partner due to outsourcing and subcontracting operations and agreements, most notably in traditional segments such as textiles and leather. Since then, Morocco has developed know-how in several areas, in addition to a competitive fabric supply segment. This is the…

Analysis

Necessary measures: Major efforts to lower the nation’s twin deficits
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A move to reduce fuel subsidies is expected to help the government’s efforts to strengthen its balance sheets. Largely as a result of a protracted slowdown in Europe, the primary trade partner and major source of foreign direct investment, Morocco’s “twin” (fiscal and trade) deficits have risen steadily in the past five years. In addition to lower demand from the Eurozone, an increase in global oil prices and a particularly weak agriculture harvest in 2012 pushed the two measures up to 7.3% and 23.8% of GDP, respectively, for that year. MAKING STRIDES: In January 2014 the government announced it would eliminate subsidies on gasoline…

Analysis

Broadening the base: The 2014 Finance Law is focused on redressing fiscal imbalances
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Fiscal reform has long been a policy priority in Morocco, although with rural development, youth employment and trade balances also competing for attention, addressing the issue has always been rather tricky. While not revolutionary, the recently approved 2014 budget goes some way towards tackling a number of the more salient weaknesses in Morocco’s fiscal framework. Somewhat more austere in tone than in years past, with the majority of changes resulting in a higher tax bill for the average person, the 2014 Finance Law focuses on redressing the country’s fiscal imbalances, notably through enlargement of the fiscal base – something which…

Analysis

On the up and up: The government is taking action to ensure the progress of recent years continues
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Over the past 10 years Morocco has changed significantly. Visitors to Casablanca, Tangiers or Agadir now explore cities that are substantively different from their 2004 incarnations, with new tramways, taller buildings and faster internet. The country’s economy has changed in an equally dramatic fashion, with impressive progress made in some critical areas. Plenty of challenges remain – including rural development, energy security and youth unemployment – but the kingdom now benefits from several free trade agreements, a major deep-sea port, free trade zones, a more sustainable fiscal policy, a robust manufacturing sector and established…

Analysis

Backed to succeed: Provision of support for smaller businesses is a growing theme
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As in other developing countries, small and medium sized enterprises (SMEs) and very small businesses (VSBs) play an important role in Morocco’s economy. The head of the cooperation service at the National Agency for SME Promotion (Agence Nationale pour la Promotion des Petites et Moyennes Entreprises, ANPME), Houssam Fathi, told OBG that SMEs account for almost 95% of all registered businesses, half of employment and 30% of the country’s exports, and that the sector contributes 20% of value added to the economy. Eager to drive growth in this sector, the government has established aid programmes, simplified administrative procedures, and…