Rabat – Morocco’s Bank Al Maghrib (BAM) report released on Tuesday, March 22, includes key talking points from the bank’s first formal board meeting of 2022 – namely, the impact of the Ukraine Crisis on the Moroccan economy and its predictions for 2022-2023 economic growth rates.
During the meeting, the BAM board conducted an in-depth analysis of the international environment, which is feeling the impact of events in Ukraine while already recovering from several other challenges.
These challenges include rising raw material costs, persistent disruptions in global production and supply chains, and increasing inflation. While the outcome and duration of the Ukraine conflict are both unknown, its impact on financial markets, commodity prices, trade, and economic activity in general is already noticeable.
Read also: Bank Al-Maghrib: Morocco’s Economic Growth Surpasses Initial Forecast
These developments have an impact on the national economy of Morocco, which is also dealing with the impact of a particularly severe drought on its important agricultural sector.
BAM estimates that cereal production will reach around 25 million quintals, a tiny fraction of last year’s 103.2 million quintals. The value of agricultural outputs is likely to fall by 19.8 percent, bringing economic growth down to only 0.7% in 2022 after a rebound of 7.3% in 2021.
Assuming a 75 million quintal average harvest in 2023, agricultural value will thus increase by 17%, translating to a growth of 4.6% in 2023.
Non-agricultural activities will also grow steadily in value at a rate of 3% in both years, the bank estimated.
