Rabat - The World Bank presented a memorandum on Morocco in Rabat, proposing an analysis of the kingdom's growth prospects for the next twenty years.
Rabat – The World Bank presented a memorandum on Morocco in Rabat, proposing an analysis of the kingdom’s growth prospects for the next twenty years.
Ten years after its last Economic Memorandum, the World Bank has devoted a new Memorandum on Morocco entitled “Morocco to 2040, Investing in Intangible Capital to Accelerate Economic Emergence.”
The report provides an exhaustive analysis of the country’s recent economic performance and growth prospects for the next twenty years, outlining economic governance reforms that can facilitate the implementation of an ambitious but realistic scenario that can accelerate economic growth in a sustainable manner and achieve more inclusive social and human development, the World Bank explains.
While Morocco’s progress over the past 15 years is undeniable, the rate of economic integration in the Kingdom is still very low.
In the two past decades, Morocco’s economy saw accelerated growth, seen in the improvement of the average standard of living of the population and the expansion of access to public infrastructure development.
While many economic indicators have painted a positive outlook on the country’s overall growth, this is not the case for the economic and social integration of young people. The Bank’s report notes that unemployment among the 25-35 age group represents a major challenge for Morocco; only one in two young people in this age group has a job, which is often informal or precarious.
Reward on Investment
Recent years has seen Morocco prove itself as a world champion in investment, but the Kingdom remains unproductive compared to countries that invest much less. According to the Bank, this stagnation has an impact on the rate of growth of the country, which is still below the level needed to initiate real development.
“Investment in itself is not enough, it must be profitable,” said Jean-Pierre Chauffour, economist and senior author at the World Bank. “Growth must be driven more by foreign trade. The challenge is above all to maintain a higher average level than the current rate over a period of 20 years.”
To achieve an inclusive growth by 2040, the World Bank advocates the improvement of institutions to support the functioning of markets by establishing the same level of playing field for all economic actors allowing for free and fair competition and by promoting a cultural shift towards business and innovation.
The Bank also recommended reducing labor regulations and improving the effectiveness of active labor market policies, given that the revision of the Labor Code would significantly increase formal employment, especially among young people and women.
According to the Bank, Morocco should deploy more efforts into integrating the global economy, which will help increase its attractiveness for investors and boost its exports. A full and thorough free trade agreement with the European Union would also amplify the country’s potential for economic transformation.
Economic integration is not the only factor that is pulling down Morocco’s economy. The World Bank stressed the need of the Kingdom to put education at the heart of its reforms if it wishes to accelerate its economic development. The Bank is advising the country to take a “shock therapy” approach designed to address the major constraints of the Moroccan education system.
The gloomy reality of the Kingdom’s education system has pushed the World Bank to talk about an “educational miracle,” stressing the need of immediate action to improve the level of Moroccan pupils as measured by international tests. This will require investment in health to strengthen human capital, expanding health coverage, improving the efficiency of public health services, and strengthening the overall governance of the health system.
The report also highlights the importance of the development of care and early childhood education to ensure equal opportunities from an early age, and the improvement of long-term economic performance as part of the sustainable solutions Morocco can adopt.
“It is imperative to ensure that all children have access to pre-school education and other conditions necessary for their development,” the World Bank emphasizes.