Fitch Expects Morocco’s Growth to Reach 3% in 2024 & 3.5% over 2025-2026 Period
Fitch agency has maintained Morocco ‘BB+’ rating with a stable outlook thanks to the country’s sound macroeconomic policies, strong official creditor support, favorable debt profile and comfortable liquidity buffers.
In 2023, Morocco’s economy grew by 3.4%, driven by strong non-agricultural sector performance and a rebound in agricultural output following a sharp contraction in 2022, said the international rating agency which expects a 3 % growth in the North African Kingdom in 2024 due to limited rainfall affecting agricultural production.
“We expect growth to average 3.5% over 2025-2026 on the back of normalizing agricultural output and sustained non-agricultural sector performance”, said Fitch in its latest report on Morocco.
The experts of the agency anticipate strong external demand to provide tailwinds to tourism and the automotive industry, while the government’s homeownership policies bolster the construction sector.
In 2023, Morocco’s deficit narrowed to 4.3% of GDP (5.4% recorded in 2022) owing to a decline in subsidy spending as a result of lower international gas prices. Fitch forecasts the budget deficit to further edge down to 4.1% and average 3.6% over 2025-2026, compared with a ‘BB’ median forecast of 3.6% in 2024 and 2.6% over 2025-2026.
According to Fitch outlook, Morocco’s trade deficit is expected to reach 17.6% of GDP over 2024-2026 driven by expected consolidation of domestic demand and the improving performance of exports, which will boost imports of consumer products and intermediate goods, respectively.
The rating agency expects net FDI to rebound to 0.8% in 2024 due strong investment inflow in the automotive sector. Morocco is set to benefit from China’s supply chain regionalization as the latter faces US and EU import restrictions.
Fitch says Morocco enjoys political stability contrary to the recurring bouts of unrest rocking the Middle East and North Africa region, making the Kingdom an attractive destination for global investors.
