Morocco forecasts a 4.6 % economic growth in 2025
Morocco forecasts economic growth to rise to 4.6% in 2025, based on current assumptions, Economy and Finance Minister, Nadia Fettah, said in Rabat on Thursday.
The official, who was presenting the 2024 Budget execution, the 2025 finance bill framework and the three-year budget plan for 2025-2027 at a joint meeting of the finance committees of both Houses of Parliament, said that medium-term growth is expected to surpass the 4% threshold.
This optimistic projection follows an anticipated growth rate of 3.3% in 2024, which reflects signs of recovery in global economy and the continued revival of national economy.
She pointed out, however, that the figures are “subject to revision should global growth prospects, especially in Europe, deteriorate due to geopolitical tensions, or if another year of drought leads to below-average agricultural output.”
The Finance Minister also stressed that the formulation of the 2025 PLF and the three-year budget plan are occurring during a phase where government action is intensifying to complete major projects and fulfil the commitments of the government program. This effort is aligned with the royal directives and the recommendations of the new development model, she said.
Key assumptions for the macroeconomic framework for 2025-2027 include cereal production reaching 70 million quintals, brent crude oil priced at $80 per barrel, butane at $450 per ton, and an exchange rate of 9.8 dirhams to the dollar, with inflation expected to stabilize at 2%.
Effective fiscal policy and debt control are crucial for maintaining the sustainability of public finances, Fettah emphasized. She highlighted the importance of progressively reducing the budget deficit to ensure this sustainability, a major pillar of government action.
“Reducing the budget deficit will balance the implementation of reform projects and development initiatives, and strengthen budgetary margins to preserve the resilience of the national economy against potential shocks,” she explained.
For the 2025-2027 period, the budget deficit is targeted to be reduced to 3.5% of GDP in 2025, and further to 3% in 2026 and 2027. The debt ratio is also expected to decline from 69.5% of GDP in 2023 to approximately 66% by the end of 2027, ensuring debt sustainability and rebuilding budgetary margins to tackle future risks and crises.
Regarding the 2024 Budget execution, Fettah stated that inflation is expected to return to levels consistent with the price stability objective, averaging 1% in the first half of 2024, compared to 7.9% during the same period in 2023, primarily due to a significant drop in food prices.
During the same period, exports increased by 4.4%, imports by 2.3%, and the trade deficit decreased by 1%, equivalent to 1.2 billion dirhams.
Fettah also indicated that the current account deficit of the balance of payments should not exceed 2% of GDP in 2024, with foreign exchange reserves at Bank Al-Maghrib covering five and a half months of imports.
The budget deficit decreased to 27.5 billion dirhams during the first half of this year, representing approximately 44.3% of the level projected by the finance law.
