The Moroccan economy demonstrated resilience and positive trends in 2024 despite facing significant challenges. Recent rainfall has alleviated drought conditions, contributing to a more favorable outlook for the agricultural sector. Overall growth is projected to increase to 3.6 percent in 2025, according to the World Bank’s latest economic update for Morocco, “Prioritizing reforms to boost the business environment”.
In 2024, Morocco’s overall Gross Domestic Product (GDP) growth decelerated to 3.2 percent due to drought impacts. However, non-agricultural growth increased to an estimated 3.8 percent, driven by a revitalized industrial sector and a rebound in gross capital formation. Inflation fell below 1 percent, allowing Bank Al-Maghrib to begin easing monetary policy. Morocco’s external position continues to be stable, with a moderate current account deficit financed by increasing foreign direct investment inflows, supported by strong investor confidence. Despite spending pressures, the debt-to-GDP ratio is gradually declining.
Significant socioeconomic challenges persist. The recent inflationary shock has eroded households’ purchasing power, resulting in depressed confidence indicators. Although urban labor markets showed improvement, with the addition of approximately 162,000 jobs in 2024, job creation remains a critical challenge. Over the past decade, the working-age population has grown by over 10 percent, while employment has increased by only 1.5 percent. This gap is influenced by the lingering impacts of the post-pandemic shocks, the delayed impacts of recent reforms, and the low level of women’s participation in the labor market.
The economy is expected to grow faster at a pace of 3.6 percent in 2025, and improved climatic conditions should allow for a partial recovery in agricultural output, with agricultural GDP projected to expand by 4.5 percent. Non-agricultural growth is expected to decelerate slightly to 3.5 percent due to base effects.
“Morocco’s economic outlook remains robust, characterized by controlled inflation, a strong external position, a steady path towards fiscal consolidation, and a stable debt-to-GDP ratio,” said Ahmadou Moustapha Ndiaye, Division Director for the Maghreb and Malta at the World Bank. “Pursuing structural reforms to address recent shocks and employment challenges, particularly those affecting young Moroccans, remains crucial for sustaining economic growth. This will require targeted improvements to the business environment.”
The report includes a special focus chapter covering Morocco’s business climate, with insights from the Business Ready report dataset published in 2024, highlighting opportunities for reform. Morocco outperforms similar-income countries in regulatory frameworks and public services but lags in operational efficiency. Highlighted areas of improvement include addressing high costs and barriers to formal hiring, clarifying procedures and enhancing digital processes and transparency in dispute resolution, finalizing the legal framework, and digitizing services for insolvency cases. The section includes an analysis looking at leading countries to help inform the prioritization of reforms going forward.
The report underscores that with strategic reforms and a commitment to modernization, Morocco has the potential to significantly enhance its business environment, fostering economic growth and creating a more inclusive job market.
Distributed by APO Group on behalf of The World Bank Group.