Morocco’s political landscape has been relatively stable in past decades and evolved smoothly through the Arab Spring. Morocco engaged in a program of wide-ranging reforms with the adoption of a new Constitution in 2011, which set the basis for a more open and democratic society, increased decentralization, modern institutions and a renewed state of law more broadly. The current coalition government, led by the moderate Islamist party, PJD (Party for Justice and Development), is continuing to roll out constitutional reforms and taking bold steps to reduce the fiscal deficit, namely through the phasing out of fossil fuel subsidies. 

Following a period of political transition, the country held the much-awaited regional and local elections in September 2015 that defined a new political map where two major political players emerged: ruling PJD and opposition party PAM (Party for authenticity and modernity). While the latter dominated the leadership of the country’s regions (5 out of 12), PJD is the clear winner in the management of Morocco’s largest cities. This new share of political powers will redefine the government coalition that will emerge from the 2016 legislative elections.

After a mixed economic performance in 2014, the Moroccan economy is picking up in 2015. Thanks to an exceptional 2014/2015 agricultural season, economic growth is projected to rebound to 4.7 percent.  Inflation has been kept under 2 percent reflecting the continued prudent monetary policy and fall in international commodity prices. The unemployment rate has declined to 9.3 percent but remained close to 40 percent and 20 percent among the urban young and educated, respectively.  

Continued progress toward fiscal consolidation and improvement in external indicators underscored Morocco’s commitment to preserve macroeconomic stability. For the third year in a row, Morocco should be able to reduce its fiscal deficit in 2015 to 4.6 percent of GDP and began stabilizing the central government debt at around 66 percent of GDP. Improvements on the external front have been more significant. The current account deficit, which culminated to 10 percent of GDP in 2012, was reduced to 4.6 percent of GDP in the first half of 2015. On the capital account side, financial inflows continued to be buoyed by relatively high FDI, support from the Gulf Cooperation Council (GCC), and financial assistance from development partners, including the World Bank Group. 

Morocco’s economic outlook hinges on the pursuit of sound macroeconomic policies and an acceleration of structural reforms. With a return to normal rainfall conditions in 2015/2016, overall GDP growth is projected not to exceed 3 percent in 2016. The 2016 Finance Law currently under preparation should confirm the authorities’ resolution to solidify the tax base, rein in expenditures and further reduce the deficit to 3.7 percent of GDP in line with the Government’s commitment to achieve the 3 percent of GDP target by 2017. With the current oil price projections, Morocco’s external position is also expected to strengthen over the medium term. 

Morocco continues to face the key challenge of leveraging its political stability, proximity to Europe, and relative investment attractiveness into a decisive edge for rapid and inclusive economic catching-up. Notwithstanding a respectable economic performance, the economy has remained structurally oriented toward non-tradable activities (such as construction, public works, and low value-added services) and a volatile, weakly productive agriculture. Morocco has yet to secure the productivity and competitiveness gains needed to further integrate into world markets, create jobs for the millions of unemployed youth and women, and support the emergence of a larger middle class. The challenge of further reducing poverty and increasing shared prosperity, including through well targeted social safety nets, remains paramount.

Last Updated: Sep 30, 2015

A new World Bank Group Country Partnership Strategy (CPS) for Morocco for 2014-2017 was presented to the Board on April 29, 2014. The strategy draws from extensive consultations with representatives of government, civil society, private sector, and other key development stakeholders. The new framework revolves around three strategic results areas: Promoting competitive and inclusive growth; Building a green and resilient future; and Strengthening governance and institutions for improved service delivery to all citizens. Gender, youth, voice and participation have also been retained as crosscutting themes. 

Under the new CPS, the Bank is scaling up its support to Morocco, with an indicative IBRD lending program increasing from $600 million a year to $1 billion a year over the CPS four-year period. The CPS program aims at stepping up and consolidating Bank Group engagement around multi-sector issues, such as economic competitiveness, improved quality of public services, good governance, social protection and subsidy reform, and strengthening inclusion and voice for women and youth. Since the CPS has reached its two years implementation period, the Bank in close collaboration and consultations with the client and other stakeholders, is now undertaking the Performance and Learning Review (PLR) to assess progress in the implementation of the CPS and, if necessary, to introduce necessary changes to stay aligned with the Government’s priorities. 

While Development Policy Loans (DPLs) will continue to be a defining component of the lending program in Morocco given the maturity of reform programs in several areas such as governance, competitiveness, financial sector, employment or green growth, the Bank will also continue to implement important sector-specific investment programs, particularly in water and sanitation, energy, roads and agriculture projects.  Where applicable, the Bank will increasingly resort to its new and innovative Program-For-Results (PforR) instrument, currently supporting the National Initiative for Human Development (INDH2) and Health Sector Support, to enhance the implementation of large development programs requiring strong results-focus and institutional capacity strengthening (e.g. in the health and urban transport sectors). The sharing of knowledge and technical expertise, including through South-South exchanges, will also continue to form an integral part of the Bank’s relationship going forward.

Over the course of the previous Country Partnership Strategy (2010-2013), the World Bank Group support program achieved satisfactory results combining analytical work, lending operations and technical assistance. The program helped mainly address private and financial sector reform, access to education and basic services, reduced vulnerability and social exclusion, improved agriculture sector and solid waste management.

Area 1: Growth, competitiveness and employment:

  • Support to the country’s competitiveness framework: Through a set of policies and regulatory mechanisms to improve business environment and attract investments. The country’s ranking went from 124th of 181 economies in 2009 to 87th of 189 economies in 2013
  • Enhanced reform of the financial sector, an IFC-World Bank support package combining lending, technical assistance and advisory services: improved household access to finance, strengthened credit infrastructure for small businesses, improved liquidity etc.
  • Promoting employment: Building a better match between trainings and job market demand, supporting youth micro-entrepreneurship and helping insertion of youth and women in the labor market.

Area 2: Service delivery to citizens

  • Improved access to education: Morocco significantly increased primary school enrollment rates, building of school infrastructures especially in remote areas, support to the ministry of Education’s decentralization process and improved sector governance.
  • Support to the National Initiative for Human Development: A complete support package to help Morocco achieve its poverty reduction targets and improve access to opportunities and basic infrastructure to vulnerable people.
  • Improved access to basic infrastructure: Improved water and sanitation infrastructure and supporting Morocco’s rural roads program in lagging regions.
  • Improved performance and governance of the solid waste sector management: Lending and technical assistance operations helped address some of the sector’s performance and management challenges.
  • Improved justice sector service delivery: Supporting the introduction of international best practices in court management.
  • Building stronger social safety nets: Technical assistance to social protection programs, namely the Tayssir pilot program (a conditional-cash transfer mechanism) aimed to reducing school drop-out rates, or the RAMED program (non-contributory insurance for poor and vulnerable segments)

Area 3: Sustainable development in a changing climate

  • Support to Morocco’s Plan Maroc Vert (PMV – the country’s strategy to enhance agriculture sector performance): bringing a substantial shift away from a highly protected market to a more open market-oriented agriculture to create better opportunities for farmers
  • Adaptation to climate change : Strengthening Moroccan farmer’s capacity to adapt to climate change and integrating sustainable agricultural practices in the PMV
  • Improved risk management strategy: Supporting Morocco’s program on natural disasters risk management and predictability and scaling up cross-sectoral coordination.



Morocco: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments