Morocco’s green transition strategy could generate up to $8 billion in revenue by 2030 through integration with the European carbon market, representing over 3% of GDP, according to an International Monetary Fund report published in April 2025.
The IMF utilized a global macroeconomic model covering 15 regions and 14 sectors to simulate the impact of Morocco’s climate reforms. The analysis suggests that eliminating butane gas subsidies while increasing taxes on coal and heavy fuel oil could reduce emissions by 16% and boost renewable energy’s share by over six percentage points by 2030.
Rather than hindering economic growth, these measures could increase GDP by 0.8%, supported by improved resource allocation and targeted redistribution of tax revenues. The fund’s modeling indicates that a moderate carbon tax between $36 and $82 per ton of CO₂ would align Morocco with its climate trajectory while maintaining near-zero impact on economic growth.
The report emphasizes redistributing carbon tax revenues as household compensation to preserve purchasing power and ensure equitable transition—particularly relevant given the political sensitivity surrounding energy subsidy reform in Morocco.
Morocco’s financial sector plays a strategic role in this transition. Under Bank Al-Maghrib supervision, Moroccan banks must publish climate exposure data according to international sustainability standards beginning in 2027. Regulators are developing a national climate finance strategy targeting 50% private sector funding for the transition, approximately $4.5 billion annually through 2030.
Green bond issuance remains relatively modest at around 4 billion dirhams cumulatively between 2012 and 2023, suggesting significant growth potential. The IMF commends Morocco’s integrated governance approach, positioning the country as an African model for coordinating monetary and climate policies.
Integration with the European Union’s Emissions Trading System could substantially enhance Moroccan export competitiveness ahead of the bloc’s Carbon Border Adjustment Mechanism implementation. The fund concludes that Morocco demonstrates the viability of greening growth without sacrificing economic expansion, illustrating how economic stability can become inseparable from environmental sustainability.
