After an unprecedented recessionary shock in 2020, Morocco is entering a phase of acceleration supported mainly by the recovery of the agricultural sector and the revival of external demand, according to the latest World Bank report.
Entitled ” Monitoring report on the economic situation in Morocco, from recovery to acceleration“, The World Bank maintains that Morocco stands out internationally by the reform process that was initiated in the context of the pandemic and the new development model (NMD), raising questions regarding the objectives of the NMD are – they are achievable or what reforms could have a pronounced impact on growth.
Thus, it emerges from the WB report that Morocco, and after the unprecedented recessionary shock in 2020, is entering a phase of acceleration supported mainly by the recovery of the agricultural sector and the revival of external demand. Nevertheless, and to embark on a trajectory compatible with the ambitions of the New Development Model (NMD), Morocco should diversify its sources of growth, estimates the report.
Growth: The need to include women and young people
During the 21 centuries, Morocco exceeded the MENA region in terms of growth (120% for Morocco against 90% for MENA), the report reminds us. That said, the results are more mixed, underlines the same source, if we compare with all the developing countries (DCs).
Indeed, the WB argues that capital accumulation has been the main engine of economic growth in Morocco, contrasting with a low contribution of human capital and productivity.
” Morocco has significant comparative advantages (infrastructure, stability, macro, financial system), but also gaps in human capital (health and education), access to ICTs or the functioning of the labor market.“, Supports the report.
In sum, the simulation exercises, carried out as part of this report, suggest that to achieve the ambitions of the NMD, Morocco must diversify the sources of its economic growth, noting that the productivity and inclusion of women and young people in labor markets are key to accelerating Morocco’s convergence towards countries with higher income levels.
Regarding economic recovery, the World Bank report considers that it remains ” heterogeneous “, With certain sectors such as tourism still very affected by the shock, pandemic and macro-financial risks still pronounced, and social indicators which have not yet returned to their pre-pandemic level.
As the crisis subsides, the budget deficit begins to narrow, the report finds, while the recovery in exports, being less than that of imports in 2021, the improvement in the current account in 2020 wears off, According to the World Bank monitoring report on the economic situation in Morocco, from recovery to acceleration.