Rabat - After the 1.6 percent registered in 2016, growth forecasts for 2017 have even been revised upwards by the High Commission for Planning (HCP), estimated to reach 4 percent instead of the initial 3.5 announced in January due to significant increases in agricultural activities.
Rabat – After the 1.6 percent registered in 2016, growth forecasts for 2017 have even been revised upwards by the High Commission for Planning (HCP), estimated to reach 4 percent instead of the initial 3.5 announced in January due to significant increases in agricultural activities.
During a conference held Wednesday in Casablanca, Ahmed Lahlimi, head of the HCP, announced that the growth rate recorded by his institution is now aligned with that of the World Bank, which had also forecasted 4 percent in a report published in January.
These two predictions, however, are less optimistic than that of the government, who in the 2017 FInance Bill projected growth perspectives of 4.5 percent.
According to the HCP, the renewed energy of the Moroccan economy is due in large part to the good performance of the world economy but also to certain components of the national GDP. “In an international context that invites optimism, our national economy should improve its performance, but continue to suffer the effects of its structural deficits,” stressed Lahlimi, who also expects the 4 percent growth rate to be maintained in 2018.
On the national level, this upward revision can be explained by the “good results of the 2016-2017 crop year,” according to Lahlimi. Rainfall and improvements in area under cultivation are expected to lead to a 200 percent increase in cereal production compared to the 2016 crop year.
The agricultural sector is anticipated to help bring the value added of the primary sector to 13.9 percent in 2017 compared to 11.3 in 2016, as well as contribute to GDP growth by to 1.7 percent, instead of -1.4 percent a year earlier.
Lahlimi also brought up the performance of non-agricultural activities, which he called a “real Achilles heel of the national economy.” The latter are expected to follow slow growth with 2.5 percent, after 2.2 percent in 2016, far from the average rate of 4 percent experienced during the period 2008-2011.
Their contribution to overall economic growth is thus forecasted to be 1.9 percentage points in 2017, instead of an annual average of 2.8 percentage points over the last 10 years, according to the HCP.
Moroccan economy dependent on volatile factors
While agricultural activities are the main booster of national economic growth, it remains too dependent on volatile natural factors. This instability still persists despite Morocco’s efforts in recent years to reduce dependence on rainfall, notably through the launch of several sectoral strategies and economic reforms.
“The low level of diversification and competitiveness of the national supply is at the heart of the fragilities of the demand which would continue to be the engine of national economic growth,” the High Commissioner said.
According to Lahlami, this dependence not only drags down the Moroccan economy, but if no efficient reforms are urgently adopted, this disadvantage would continue to increase unemployment, reduce income opportunities, expand social deficits, and increase the dependence on domestic demand for imports.
Lahlimi once again stressed the urgent need to accelerate the pace of structural reforms of the Moroccan economy. “Reforms should aim to eliminate all latent threats, both in our economic fabric and our public finances, in the system of development of our human resources and in our way of national and regional governance.”