ADB: Morocco’s Economic Growth Upticks to 3.5% in 2024

After recording an estimated 3% growth rate in 2023, Morocco’s economy is expected to grow by an average of 3.5% in 2024 and will consolidate at 3.9% in 2025, according to a recent outlook from the Africa Development Bank (ADB).

Rabat – After recording an estimated 3% growth rate in 2023, Morocco’s economy is expected to grow by an average of 3.5% in 2024 and will consolidate at 3.9% in 2025, according to a recent outlook from the Africa Development Bank (ADB).

Economic growth, as measured by the Gross Domestic Product (GDP), tracks the increase in a nation’s production of goods and services. It is largely considered a reliable metric to assess the performance of an economy.

Morocco’s economic growth is slightly lower than North Africa’s 3.9 % average in 2024. The ADB report explains that the region has been adversely affected by the drought in Morocco and Tunisia, as well as the recent flooding in Libya.

Adding to the region’s woes, Egypt’s macroeconomic challenges have made it increasingly difficult to sustain grain supplies post-COVID.

Lack of inclusive growth and high youth unemployment have continued to pose social challenges more than a decade after the 2011 Arab Spring, the report argues.

In Morocco, inflation continues to weigh down on the growth prospects, according to the 2024 World Economic League Table report.

Inflation surged in 2023 despite promising economic growth, hovering at around 6.3%, a far outcry from the recommended 2%.

The World Economic League Table report had warned that rising inflation would be raising concerns about a potential stagflationary trade-off, pitting growth against rising prices.

Stagflation describes an economy that is witnessing stagnant economic growth (stagnation) and high inflation. It’s a situation where an economy experiences slow or stagnant growth in its Gross Domestic Product (GDP) coupled with rising prices or inflation.

In addition to inflation, unemployment is also a factor undermining Morocco’s prospects for economic growth.

At the end of 2023, the country’s unemployment reached an all-time high level as drought-stricken agriculture – once the country’s largest employing sector- lost 157,000 jobs.

The massive exodus was partially offset by the creation of 5,000 jobs in urban regions. However, the overall unemployment rate rose to a staggering 13%.