Moroccan Economy Shows Resilience in Challenging Times
The Moroccan economy demonstrated resilience in 2023, growing at a rate of 3.4% according to recently released national accounts data from the High Commission for Planning (HCP). This faster pace of expansion comes despite high inflation and marks an improvement over the prior year's growth of 1.5%.
Domestic demand acted as the key driver of growth, supported by a pickup in activity across both agriculture and industry. The agricultural sector expanded by 1.4% after a steep decline in 2022, led by rebounding output from crops and fishing. Industrial production also recovered, with manufacturing and energy sectors contributing to a 1.3% rise in secondary sector value-added.
Services remained the largest component of the economy, however its growth moderated to 4.4% from 6.8% previously. Accommodation, research and business services, finance, communications and public administration all saw slower expansions. Transportation and logistics as well as real estate countered this to some extent with quicker growth.
Underpinning the economy's resilience was a 1.6% climb in primary sector value-added, benefiting from stronger agricultural and fishing yields after weather-hit harvests last year. Tax revenues also rose at a brisker 4.9% pace on the back of increased domestic spending and production.
Overall gross domestic product in volumetric terms rose 3.4% for the full year, demonstrating the economy's ability to pick up momentum despite external headwinds like inflation. Policymakers will hope activity can be sustained at a healthy clip to make further progress reducing unemployment and financing the country's development needs. With strong fundamentals and improving indicators, Morocco appears well-positioned for continued growth in the coming period.