The International Monetary Fund (IMF) has highlighted, in a new analysis on the impact of climate change on the economy in the MENA region, the importance for Morocco of investing in hydraulic infrastructure to foster a resilient economy. .
“Simulations carried out on Morocco show that investments in hydraulic infrastructure would improve resilience to droughts, reduce GDP losses by almost 60% and limit the increase in public debt”, according to a blog co-authored by the director of the IMF’s Middle East and Central Asia department, Jihad Azour, and the coordinator of the climate work of the same department, Christophe Duenwald. In the study entitled “Feeling the Heat: Adapting to Climate Change in the Middle East and Central Asia”, experts from the international institution carried out a simulation to quantify the macroeconomic impact of investments in climate change adaptation measures. climate in the Kingdom.
While recalling that Morocco has invested in the development of its hydraulic infrastructure over the past decades, the study compares two scenarios: a standard infrastructure investment plan and an adaptation investment plan with enhanced resilience. .
“The adaptation investment plan offers higher economic returns, even before a drought materializes, than the standard investment mix”note the authors of the study.
Although both types of public investment increase the productivity of the private sector, resilient irrigation projects (such as dams and canals) generate higher dividends for GDP because they offer better economic returns in drought-prone countries than standard investments, even before a drought strikes, it is pointed out. “Investment in climate adaptation improves the resilience of the Moroccan economy to drought episodes”conclude the experts of the Bretton Woods institution, specifying that an adaptation investment in resilient irrigation infrastructure could reduce the Kingdom’s GDP losses by almost 60%, bringing them down to around 1%.
Furthermore, adds the same source, the improvement of water supply and irrigation capacities would help to close the gap between demand and supply of water in the agricultural sector, which would allow it to remain productive. to a large extent, even in the event of drought. Similarly, the more moderate decline in GDP would also be beneficial for the trajectory of the debt-to-GDP ratio following drought episodes. Morocco’s agricultural production is ” very sensitive “ to droughts and would benefit from investments in climate-resilient water infrastructure, notes the IMF, recalling that the agricultural sector employed more than 30% of the workforce and accounted for around 12% of GDP in 2020.
In the same blog, IMF experts point out that “Climate change is having devastating effects in the Middle East and Central Asia, where poor and conflict-affected countries suffer the most from rising temperatures and extreme weather events. » Over the past 30 years, temperatures in the region have increased by 1.5 degrees Celsius, twice the increase observed globally (0.7°C). For the IMF, it is essential that the international community cooperate to “make the most of adaptation and manage its costs”, in particular for the most vulnerable countries