Good prospects of economic recovery for Morocco one year after pandemic
RABAT – Morocco’s economic recovery is outpacing that of nations across Africa and Latin America according to new data from Bloomberg. The financial data company on Wednesday released its Economics Rankings which evaluates the economic recovery of 75 emerging market economies.
According to this analysis, the Moroccan government’s measures adopted since the outbreak of the coronavirus pandemic, including stimulus packages and monetary policies, have contributed significantly to the softening of the pandemic’s economic impact.
Bloomberg researchers expect the Moroccan economy to overcome the effects of the health crisis, projecting a 4% to 5% recovery during the current year. This comes after much economic activity ground to a halt in 2020, leading to a drop in gross domestic product of more than 5% .
In its latest semi-annual report on the global economic prospects released this week, the International Monetary Fund (IMF) predicted that the Moroccan economy will grow by 4.5 % in 2021 and about 3.9 % in 2022.
In its outlook at the regional level, the IMF estimates that a year after the start of the coronavirus pandemic, the path to economic recovery in 2021 should be “long and differ from one country to another”.
The report concluded “the outlook will vary considerably depending on the trajectory of the pandemic, the deployment of vaccines, the underlying vulnerabilities, exposure to tourism and contact-intensive sectors and finally the room for manoeuvre and interventions.”
Moroccan economic expert Al-Arabi al-Jaidi expects 2021 will be better than 2020, given that every period of economic stagnation is usually followed by an “inevitable leap.”
However, he noted “the year that will be decisive for future perceptions and a possible end of the crisis is 2022.”
The economic recovery in Morocco is linked to the performance of the agricultural sector, foreign investments, oil prices and the currency rates that Morocco uses in commercial exchanges.
The crisis affected small and medium-sized companies, but government measures reduced its impact.
Since the start of the pandemic, Morocco’s professionals have hailed the government’s support for the country’s companies, which has helped many businesses absorb the economic shock.
They argue the crisis has created a turning point that necessitates the creation of sustainable models for growth and for the transformation of the Moroccan economy.
Jihad Azour, IMF Director of the Middle East and Central Asia, singled out Morocco’s resilience in dealing not only with COVID-19 but also drought and for implementing the most advanced vaccination programme in the region outside of the Gulf.
“The Moroccan economy was one of the most dynamic and was able to adapt and to adjust facing constraints and opportunities,” he said.
Azour pointed out that the Kingdom of Morocco is now “one of the most advanced countries in the field of vaccination, which will be a critical factor in achieving recovery at the global level.”
Azour said that thanks to the health, tax and monetary measures taken by the government last year, Morocco has succeeded in returning to the path of growth.
Economic researchers believe that the post-Covid economic recovery will be driven by the quality of the kingdom’s infrastructure, including roads, ports and airports, which form excellent factors in the attraction of foreign investments.
Speaking at a press briefing on the MENA region’s economic performance, Azour said Moroccao’s economy has shown resilience in the face of the double impact of Covid-19 and drought last year and hence stands as one of the most dynamic in the region.
He recalled that Morocco drew down on the precautionary liquidity line offered by the IMF to deal with external shocks.
He lauded Morocco for its reforms which were stepped up during the pandemic with a focus on social safety nets.
The focus on social dimensions and the steps taken to bolster social protection in favour of most vulnerable social categories had been key to dealing with the social crisis caused by the pandemic, he said.
Morocco has also reaped the benefits of its decade-long fiscal and monetary reforms and was now in a better position to strengthen its foreign exchange reserves despite the crisis.
Morocco has distributed aid to five million households, most of whose main providers work in the informal sector.
Last week, Morocco also launched a project to widen its social security net and ease financial pressure on the country’s working class.
According to Minister of the Economy Mohamed Benchaaboun, the project aims at preserving the dignity of all Moroccans and protecting vulnerable groups, especially in light of the economic fluctuations and health risks that the world has come to know.
The kingdom has administered the highest number of inoculations in Africa so far — 9.5 million doses for a population of 36 million since vaccinations began January 29. The per-person vaccination rate is higher than in some European countries that started a month earlier.
Morocco is using vaccines from AstraZeneca and China’s Sinopharm. Millions more doses are expected eventually from both companies as well as from the global COVAX programme to provide vaccines to low and middle-income countries.