Home Economy Moroccan Economic Growth to Fall to 2.6% in 2018: HCP

Moroccan Economic Growth to Fall to 2.6% in 2018: HCP

Moroccan Economy. REUTERS/Stringer
REUTERS/Stringer

Rabat – After a growth rate of 3.8 percent during the fourth quarter of 2017, the national economy should experience a sharp slowdown during the first three months of 2018, as the growth rate is expected to fall to 2.6 percent.

The High Commission for Planning (HCP) is not optimistic for 2018. In terms of prospects for this beginning of the year, the HCP expects a slowdown in growth during the first three months of 2018 to 2.6 percent, as a result of the downturn in agricultural activities in comparison with the notable performances achieved in 2017.

“Unlike the previous agricultural campaign, which was characterized by favorable weather conditions for early crops, the 2017/2018 crop year will be characterized by less abundant autumn rainfall, the effects of which would be more noticeable in the area sown to cereals and pulses, but also at the level of irrigated crops,” reported the HCP.

The source revealed that the filling rate of agricultural dams stood in mid-December 2017 at its lowest levels in the last six seasons, at 32 percent. “The return to normal winter weather conditions should limit the fall in agricultural value added to -3.1 percent year-on-year, in the first quarter of 2018, instead of an increase of 14.2 percent in 2017.”

In terms of non-agricultural value added, the HCP expect an acceleration of its growth in the first quarter of 2018, benefiting from an improvement in the business climate in the advanced economies and which would result in a 4.5 percent increase in world demand addressed to Morocco.

While the HCP set the 2018 growth rate at 2018, for the rest of the year, everything will depend on the rainfall situation in the coming months, and the possibility for the agricultural sector to catch up with some of the delay lived at the beginning of the current season.

In 2017, the Moroccan economy performed rather well as the growth rate stood at 3.9 percent by the end of 2017, compared to 1.2 percent a year earlier.

These achievements were recorded in a context where foreign demand addressed to Morocco strengthened by 5.1 percent, in the fourth quarter of 2017, in line with the evolution of world trade.

The HCP also stated that the trade balance deficit declined by 3.4 percent while the coverage rate increased by 2.6 points to 57.6 percent. “The relief of this deficit would have resulted from the less significant increase of imports compared to exports,” explained the HCP. Exports, up 15 percent, benefited mainly from the good performance of exports of crude phosphate and natural and chemical fertilizers.

With respect to domestic demand, the HCP noted that it continued its upward trend that began in 2016, despite a context of a slight rise in consumer prices. The increase in local demand resulted in a 4.2 percent increase in imports of consumer goods from households.

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