Morocco’s economy remains resilient amid regional tensions and should rank among the best-performing economies in the Southern and Eastern Mediterranean (SEMED) region, according to the European Bank for Reconstruction and Development’s (EBRD) latest regional economic outlook. The institution forecasts Moroccan growth of 4.8% in 2026 and 3.9% in 2027 — an upward revision of 0.4 points for 2026 and a downward revision of 0.1 point for 2027 versus its June projections.
The improved outlook reflects a strong rebound in agricultural production after several years of drought, up 18.4% year-on-year, which expanded significantly in the first half of 2026 and offset weaker activity in industry and construction. First-quarter GDP grew 4.6% year-on-year, against 5.0% a year earlier, as investment slowed from an exceptionally high base.
Inflation remained very low, averaging 0.5% over January-June 2026 despite a temporary acceleration linked to rising energy prices; Bank Al-Maghrib kept its policy rate at 2.25%, citing geopolitical uncertainty. Tourism receipts and remittances from Moroccans abroad continued supporting external accounts, with the current account deficit at 1.2% of GDP in the first quarter as a widening trade deficit was offset by these two sources. Reserves stood at $54.3 billion in August 2026, covering about 5.3 months of imports.
The government projects a budget deficit of 3.4% of GDP in 2026, in line with its target, and a debt-to-GDP ratio of 65.8%, down from 66.6% in 2025. Morocco also completed an oversubscribed international bond issuance in May 2026.
The EBRD estimates SEMED regional growth at -0.7% in 2026, before rebounding to 7.1% in 2027, dragged down by a sharp contraction in Iraq (-12.0% expected) following disruptions to oil exports through the Strait of Hormuz, and an expected recession in Lebanon (-5.0%).
Excluding Iraq, regional growth is projected at 3.9% in 2026 and 4.3% in 2027, with Egypt, Jordan, Tunisia and Morocco showing resilience even as higher energy costs and disrupted trade routes weigh on the wider region.
