Rabat – The World Bank has recently adjusted its growth forecast for countries in the Middle East and North Africa (MENA) region in a report published on October 7. Morocco’s real GDP growth is projected to rebound to 5.3% in 2021, representing a 1.1 point increase than the forecast made last April.
The World Bank report said that the rebound is due to the sustainable performance of the agricultural sector, rather than a general increase of economic activity.
“Although ongoing reforms should improve the long-term performance of the Moroccan economy, the short-term outlook is subject to significant risks given the spread of new COVID-19 variants and the persisting financial vulnerability of the private sector,” the report added.
The study described the economic recovery across the MENA region as “tenuous and uneven”, with per capita GDP increasing by only 1.1% in 2021 after declining by 5.4% in 2020.
As the COVID-19 pandemic persists, the MENA region’s GDP is expected to grow by only 2.8% in 2021.
In this rather gloomy climate, the Moroccan economy is doing well since the country will more likely record the highest GDP growth in the MENA region, outpacing Egypt (+5.1% in 2021), Saudi Arabia (+3.5%), Jordan (+3.3%), Qatar (+3%), Tunisia (+2.9%) and Algeria (+2.6%, after a recession of 15.1% in 2020).
In terms of real GDP per capita, an indicator to measure people’s standard of living, Morocco has also outperformed all of its neighbors, with a growth estimated at 4% in 2021 compared to +3.6% for Egypt, +0.4% for Tunisia, and +0.2% for Algeria.
The report further forecasts the budget deficit and the current account deficit that are expected to fall by 6.7% and 1.5% in 2021, respectively.
Meanwhile, poverty indicators should resume their declining trajectory in 2021, while the country’s poverty levels are expected to return to pre-pandemic level by 2023.
Initially, the economic recovery began in late 2020 after a 6.3% contraction earlier the same year. This is due to the underperformance of several sectors, including the tourism industry.
Despite the ongoing COVID-19 pandemic, the World Bank expressed satisfaction with the reforms that Morocco implemented to ensure continued economic growth and post-COVID-19 recovery.
Morocco’s Higher Commission for Planning’s (HCP) latest report has also indicated that the 5.9% boost in the national economy for the third quarter in 2021 is mainly driven by a 19.2% increase in the agriculture sector.
