Fitch Solutions projects Morocco’s economy to grow by 5% in 2025, despite a complex geopolitical landscape and challenges in the agricultural sector.
This growth is expected to be fueled by a significant surge in Foreign Direct Investment (FDI), a boom in tourism, and strategic investments in key sectors.
According to a report released on February 26th, Fitch Solutions anticipates Morocco’s economic growth to accelerate to 5% in 2025, up from 3.3% in 2024. This projection, while slightly revised down from an earlier 5.6% forecast due to concerns about agricultural output, remains optimistic and surpasses the consensus forecast of 3.9% from Focus Economics.
BMI, a subsidiary of Fitch Solutions, attributes the growth to a robust non-agricultural sector, driven by strong investments supported by accommodative monetary policy from Bank Al Maghrib and substantial FDI inflows, particularly in the automotive, aerospace, and renewable energy sectors.
Investment is expected to be a key driver, bolstered by ongoing rate cuts and strong FDI flows. Bank Al Maghrib is projected to continue its accommodative stance, with an additional 25-basis-point cut to the benchmark rate in 2025, following 50 basis points of reductions in 2024, bringing the rate to 2.25% by year-end. This policy is expected to stimulate private investment by reducing borrowing costs.
Morocco’s strategic location, favorable operating environment, and infrastructure investments related to the 2030 FIFA World Cup, co-hosted with Spain and Portugal, are expected to continue attracting significant foreign capital. The report notes a 55.4% year-on-year increase in net FDI in 2024.
Private consumption is also expected to remain strong in 2025, driven by government fiscal policy, low inflation, and steady remittance growth. The government’s expansionary fiscal policy, including an 11.5% increase in public sector wages, will boost household consumption. Low inflation, averaging 1.6% in 2025, will preserve consumer purchasing power, and steady remittance growth from the Moroccan diaspora in Europe will further support consumption.
However, the report notes that growth will be tempered by sluggish agricultural growth, a sector that employs nearly 30% of the workforce.
MK/ac/sf/lb/abj/APA