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Join on Telegram Rabat – Morocco’s economy saw a 5.4% rise in domestic demand during the fourth quarter of 2024, contributing 6.2 percentage points to overall economic growth, according to the latest update from the High Commission for Planning (HCP).
Household consumption played a key role, recording a 3.2% annual increase and adding two points to Gross Domestic Product (GDP) growth.
Despite a drop in rural incomes caused by persistent drought, several factors helped maintain household purchasing power.
The general stability of prices, apart from some food items, higher wages for public sector workers, social support programs, and renewed access to consumer credit all played a part.
The rise in household consumption boosted demand for finished goods, particularly automobiles, leading car imports to surge by 58.1% by the end of the year.
Public spending also grew during the period, with government consumption increasing by 3.9%, slightly above the 3.8% recorded in the previous quarter. This is mainly due to higher spending on administrative operations.
Public sector initiatives largely supported investment activity, which maintained strong momentum.
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Major infrastructure projects, including water resource development and preparations for key sporting events, the 2025 Africa Cup of Nations and the 2030 FIFA World Cup, drove this growth.
Private investment showed resilience, adjusting to slower export activity but still contributing to the overall expansion.
Gross investment grew by 9.8% year-on-year, adding 3.5 percentage points to economic growth.
This performance was also underpinned by a rise in foreign direct investment and increased imports of industrial equipment.
Higher external financing needs, driven by the rise in domestic demand, accounted for 3.8% of GDP in the third quarter of 2024.
While private savings showed slight improvement, the pace of investment growth outstripped these gains, leading to a wider budget deficit and higher corporate debt levels.
Domestic demand in Morocco is expected to maintain its positive trajectory in the first quarter of 2025, supported by a more flexible monetary policy and the implementation of fiscal and social measures to strengthen household purchasing power.
Annual growth is projected to reach 4.8%, compared to 3.8% during the same period last year.
