Morocco’s Economic Growth Drops to 1.8% in Third Quarter of 2022

Rabat – Morocco’s economic growth is estimated to have reached 1.8% at the end of the third quarter of 2022, down from the 2% recorded the previous quarter.

According to a report from Morocco’s economic intelligence center, the Higher Commission for Planning (HCP), the drop in the overall national economic activities is happening against a backdrop of a severe decline in the added value of agriculture. The added value of agriculture dropped by 15.2%.

Excluding agriculture, economic activities have grown by 3.7%, down from the 4.2% recorded the previous quarter.

The de-accelerated growth is largely due to the slowdown in secondary industries, industries that convert raw materials provided by primary industries into commodities and consumer products.

The HCP report further explains that the decline in the added value of agriculture is expected to average nearly 16% at the end of 2022.

However, growth in non-agricultural activities is expected to partially offset that, and economic growth would average 1.4% in the fourth quarter of 2022.

Noting the situation in the global market, the HCP report explains that economic activities continued to slow down in the third quarter of 2022 amid continuing supply disruptions and inflation.

As a result of the international slowdown in activities, foreign demand for Moroccan-made goods equally regressed, growing at 4.3% in the third quarter of 2022, compared to 7.3% in the previous quarter.

Regarding commodity prices, HCP maintains that despite the slight recovery in July and August, prices have remained high. The price of Brent crude averaged $99.2 a barrel in Q3 2022, down from $112.7 a barrel a quarter earlier. The price of crude oil remains 36% up year-on-year.

Natural gas prices in Europe skyrocketed in Q3 of 2022 triggered by concerns about energy shortage. Gas prices reached a staggering $60/MMBtu (Metric Million British Thermal Unit), up from $17/MMBtu a year earlier.

The price of agricultural products rose at a slower rate in Q3 of 2022, rising by 8.5% against 21.4% in the second quarter.

In light of this data, inflation rates reached 9.1% in the eurozone and 8.3% in the United States in August 2022.