Morocco leads North Africa in 2025 economic freedom index

Monday 10 March 2025 - 11:50

By: Dakir Madiha

Morocco leads North Africa in 2025 economic freedom index

Morocco has emerged as the top-ranking country in North Africa according to the 2025 Economic Freedom Index, published by the Heritage Institute. The nation secured the 86th position globally, achieving a score of 60.3. Within the Middle East and North Africa (MENA) region, Morocco ranks seventh out of 14 countries, surpassing Kuwait and trailing Saudi Arabia. This marks a notable improvement of 3.5 points from the previous year, categorizing Morocco's economy as "moderately free."

The Economic Freedom Index evaluates various factors that contribute to a country's overall economic freedom. Morocco stands out for its well-institutionalized regulatory environment, with business freedom scoring 68.9 and monetary freedom at 74.7, both above the global average. However, labor freedom remains a concern, scoring only 48.5.

The report highlights Morocco's achievements in open market components, with trade freedom recorded at 67.2, and both investment and financial freedom scoring 75. It notes that the trade-weighted average tariff rate is 13.9 percent, and both foreign and domestic investors benefit from equal treatment under Moroccan law. The country's competitive financial sector is also flourishing, offering a variety of financing options and allowing unrestricted foreign participation in the stock exchange.

This progress in economic freedom is largely attributed to ongoing reforms aimed at enhancing private-sector dynamism. These reforms have fostered increased competitiveness and diversification within the market. Additionally, the report signifies that Morocco has maintained monetary stability, reflected in relatively low inflation rates.

Despite these advancements, the report identifies several challenges that require further institutional reforms. Although the process for establishing and registering private enterprises has been streamlined, the licensing requirements remain costly. The labor market in Morocco also faces rigidity, which hampers job growth and marginalizes a significant portion of the workforce operating in the informal sector.

The Economic Freedom Index assesses the economic policies and conditions of 184 countries for the period spanning from July 1, 2023, to June 30, 2024. It is based on 12 indicators grouped into four primary pillars: Rule of Law, Government Size, Regulatory Efficiency, and Open Markets. Each indicator is scored on a scale of 0 to 100, with the average of all 12 forming the final score for each country.

Globally, the top five countries in the index are Singapore (84.1 points), Switzerland (83.7 points), Ireland (83.1 points), Taiwan (79.7 points), and Luxembourg (79.5 points). In the North African context, Mauritania ranks 119th (Mostly Unfree), Egypt 145th (Mostly Unfree), Tunisia 149th (Economically Repressed), and Algeria 160th (Economically Repressed).