Morocco

Last updated: July 5th, 2021

The Kingdom of Morocco is a country with enormous economic potential. It is located on the Mediterranean and the Atlantic coasts in northwest Africa and is therefore the gateway to the African market for goods from America and Europe. The capital is Rabat on the western Atlantic coast. The economic center is Casablanca. Morocco has around 36 million inhabitants.

As head of state, HM King Mohammed VI has initiated a transformation process through political reforms and the path of economic liberalization since he ascended the throne in 1999. Thanks to a constitutional reform in 2011, the king always appoints the leader of the strongest parliamentary group as prime minister after the parliamentary elections. Saadeddine Othmani has been running the government since March 2017. Parliamentary elections are scheduled for the fall of 2021.

The economic dynamism can be seen in Morocco’s GDP growth from almost 38 billion US dollars in 2000 to 113.5 billion US dollars in 2020. This enormous economic success was achieved despite the outbreak of the global financial crisis in 2008 and the political upheavals in the region since 2011. Investors benefit from stable exchange rates and relatively moderate inflation rates.

The agricultural sector, in which about 34 percent of all jobs can still be found today, is of vital importance. State structural programs support it with the aim of creating sustainable and environmentally conscious agriculture. The country’s infrastructure is constantly being expanded. Since 2018, Morocco is host to the first high-speed railway system in Africa. Several major ports have also opened since the early 2010s or are in the process of expansion. There are ultra-modern universities such as the Mid-Park with research facilities for nanotechnology and microelectronics. Moreover, the world’s largest solar power plant is located in Morocco and the expansion of renewable energies is flourishing.

Economically speaking, a modern transport and telecommunications infrastructure, low production costs, and the proximity to the European market speak for Morocco. In addition, investment incentives and tax advantages attract the automotive industry (assembly, supply), aeronautics, and call centers. The 2020 Doing Business Index  published by the World Bank now ranks Morocco 53rd in the world thanks to a strong improvement by six percent.

The Covid-19 pandemic hit the tourism sector hard, which had accounted for nearly a fifth of GDP in 2019. In addition, drought struck agriculture, resulting in a seven percent contraction of the GDP in 2020. Government rose to the challenge, though, establishing a strategic investment fund to support the private sector and restructure social protection as well as the network of state-owned businesses. This is expected to make the economy more stable in the medium and long term.

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