Strong Economic Growth Projections for Morocco
As Morocco looks ahead to 2026, the country is projected to experience a robust real GDP growth rate of 4.4%. This growth trajectory is bolstered by a strong agricultural output and significant public investments in infrastructure. The increase in public investments is anticipated to create opportunities for stronger economic growth and job creation, provided that risks are managed effectively and human capital is enhanced. The sustained performance of revenue streams, coupled with a reallocation of spending priorities, will open avenues for prioritized social spending and accelerate the rebuilding of financial safety margins.
Despite the optimistic growth expectations, the challenge of high unemployment remains a pressing concern. The economy is also expected to confront a temporary rise in inflation due to increased energy prices, which could impact the overall economic landscape. The Bank of Morocco has maintained a neutral monetary policy stance following previous interest rate cuts, contributing to a low average inflation rate of 0.8%. Additionally, the current account deficit widened to 2.1% of GDP, primarily due to increased imports for investment projects, although this was partially offset by strong tourism performance.
Future Economic Challenges and Risks
Looking toward the future, Morocco's economic outlook remains strong, supported by solid domestic drivers. Real GDP growth is projected at 4.4% in 2026, followed by 4.5% in 2027, and 4% in the medium term, assuming a return to normal agricultural production levels and continued investment in infrastructure with increased private sector participation. However, short-term growth prospects are tempered by ongoing conflicts in the Middle East, which primarily affect Morocco through disruptions in global commodity markets and weakened external demand amidst rising global uncertainty. The current account deficit is expected to widen slightly due to the high import content of infrastructure investments and increased costs of importing raw materials, although international reserves are projected to remain adequate.
The fiscal deficit is anticipated to remain aligned with gradual reductions in the debt-to-GDP ratio, projected to reach 60.5% by 2031. Nonetheless, risks to the outlook have increased, heightened by escalating external uncertainties. These risks include volatile commodity prices amid global uncertainties and ongoing regional conflicts, as well as potential trade barriers and disruptions in global supply chains that could adversely impact economic activity in the Eurozone. Domestically, there are concerns regarding the possibility of underperforming economic gains from public infrastructure investments, which could hinder growth and job creation. Should adverse developments materialize, the flexibility afforded by policy space alongside the flexible credit line could assist the economy in adjusting smoothly.
In light of these discussions, Mr. Kenji Okamura, Deputy Managing Director and Acting Chair, provided the following statement: "Morocco's economy continues to demonstrate remarkable resilience. The agricultural, construction, and tourism sectors have significantly contributed to economic activity in 2025. The momentum of growth is expected to remain strong in 2026 and beyond, supported by public and private infrastructure investments. However, growth in the short term will be affected by the ongoing conflict in the Middle East through increased energy prices and weak external demand. In the face of rising geopolitical tensions and global uncertainties, it is crucial to maintain prudent macroeconomic policies, manage financial and economic risks carefully, increase investments in human capital, and ensure commitment to structural reforms that drive inclusive growth and job creation."
As reported by imf.org.
