World Bank: A targeted roadmap to accelerate Morocco’s economic transformation

World Bank simulations show that real GDP could increase by 17% compared to the base scenario by 2035 and by almost 24% by 2050.

Decryption: Through two reports on growth, employment and the private sector, the World Bank is putting forward a roadmap based on structural reforms and targeted policies to accelerate the country’s economic transformation.

Morocco could generate 1.7 million more jobs by 2035 and increase its real GDP by almost 20% above the reference level, but this potential will only be realized if an ambitious reform program is implemented. Two analytical reports, produced in close collaboration with the Moroccan government and published today by the World Bank Group, provide both evidence and a roadmap to make this transformation a reality, the objective being to identify the structural changes that would allow Morocco to evolve towards transformative growth, by articulating macroeconomic reforms and. private investment opportunities in key sectors of the economy This includes carrying out structural reforms aimed at deepening market competition, freeing private investment and integrating women and young people more widely into the formal economy.

Employment prospects for 2035

Regarding the report on growth and employment, it was designed as an analytical contribution aimed at supporting Morocco in achieving the ambitions of its New Development Model (NMD) having formulated a coherent vision to modernize the Moroccan economy and society. The ambition is to double the gross domestic product (GDP) per capita by 2035, increase the employment rate of women to 45%, and formalize 80% of jobs. Although Morocco has moved forward with determination, implementing major reforms in several areas, including social protection, governance of public enterprises (PE), promotion of private investment, improvement of the business climate and taxation, the World Bank estimates that maintaining current trends will not be enough to achieve the trajectory envisaged by the NMD. presented in this report highlights a set of interconnected challenges that create a divergence between the opportunities offered and the expectations of the population. “Morocco has built solid foundations and, thanks to the recommendations of the Report on Growth and Employment, the Kingdom can go even further, create millions of jobs, deepen private investments and create real opportunities for women and young people. The World Bank Group is fully committed to this endeavor alongside Morocco,” assures Ahmadou Moustapha Ndiaye, division director at the IBRD for the Maghreb and Malta. development, the World Bank proposes a series of recommendations structured around four mutually reinforcing areas: more efficient and more competitive markets, more dynamic businesses, higher-impact public investments and more inclusive labor markets. tax and regulatory disincentives to growth, consolidate the impact of public investments and promote a more mobilized active population by highlighting the contribution of women and young people in working life Taking into account these reforms, World Bank simulations show that real GDP could increase by 17% compared to the base scenario by 2035 and near. by 24% by 2050. This would translate into 1.7 million additional and better jobs by 2035 and 2.5 million by 2050, with real wages 15% higher.

Four key sectors to stimulate private investment

In its second report, the World Bank establishes a private sector country diagnosis (CPSD). The aim is to unlock private investment and create jobs through appropriate public measures by identifying untapped private investment opportunities as well as related obstacles. The related report highlights four high-potential sectors where reforms could trigger a significant influx of private investment in the medium term. In this sense, we list the decentralized production of solar energy, low-carbon textiles, argan-based cosmetics and marine aquaculture. Sectors which are at the crossroads of the country’s energy transition, industrial modernization and regional development programs. Strengthening these common foundations would amplify the impact of sectoral reforms and further support Morocco’s green and competitive growth model. Referring to the World Bank, these sectors also benefit from preferential access to European Union (EU) markets, which represents an opportunity for all sectors and the entire economy, well beyond just the textile sector, shaping demand across multiple value chains. “Morocco has the sectoral assets and the reforming will necessary to attract significantly greater private investment,” underlines Cheick-Oumar Sylla, division director at IFC for North Africa and the Horn of Africa. And to specify: “The country is ready to move up a gear, and this diagnosis highlights concrete opportunities likely to mobilize private investments amounting to around 4% of GDP.”
In its report, the World Bank outlines concrete steps the government can take to address these bottlenecks. This involves clarifying specific regulations, simplifying and digitalizing authorization processes, improving access to land and green energy and strengthening standards and traceability systems. Measures which, according to the Bank, once implemented, could unlock approximately $7.4 billion in private investment and would also support the creation of more than 166,000 jobs in the four sub-sectors examined over the next five to ten years.