Moroccan central bank projects strong GDP growth of 5% in 2025

Morocco’s central bank has retained its key interest rate, forecasting stronger economic growth in 2025, supported by rising investment and easing inflation, according to Reuters on December 16th.

Bank Al-Maghrib (BAM) expects Morocco’s economy to grow by 5% in 2025, showcasing a clear improvement compared to last year. However, growth is expected to slow down to 4.5% in 2026 and 2027, anticipating a return to average cereal harvests of around 5 million tonnes. 

BAM kept its benchmark rate at 2.25% for the third consecutive meeting, stating that current borrowing costs are suitable given the low inflation and continued instability in the global economy.

According to Reuters, inflation has slowed due to lower food and fuel prices and is expected to average 0.8 % this year. It is then expected to increase to 1.3% in 2026 and 1.9% in 2027, staying consistent with the price stability levels.

According to an APA News report, agricultural output is expected to rise by 4% in 2026 and 2% in 2027, after accounting for the weather challenges in the sector. Non-agricultural activity is set to remain strong. BAM said growth outside farming is being driven mainly by investment, with non-agricultural sectors expected to expand by 5% this year, 4.8% in 2026 and 4.5% in 2027.

Building on this momentum, Morocco has announced two new deepwater ports and is also upgrading the airports in the country before the 2030 World Cup. 

The bank also highlighted improvements in Morocco’s external position. The current account deficit is expected to narrow to 1.8% of GDP this year and stay below 2% through 2027. 

This is due to lower energy imports and higher exports of phosphates, fertilisers and cars, alongside stronger tourism income and remittances from Moroccans living abroad.

Foreign exchange reserves are forecast to increase steadily, reaching 448 billion dirhams ($49 billion) by 2027, enough to account for around five and a half months of imports. 

In terms of public finances, the fiscal deficit is expected to reduce to 3.4% of GDP in 2026 from 3.9% this year, helped by higher tax revenues despite increased public investment. Government debt is projected to fall to 46% of GDP by 2027, from 50.8% in 2024. 

Central bank governor Abdellatif Jouahri said Morocco will continue to take a cautious approach to currency reform. While plans are in place to begin testing an inflation-targeting framework in 2026, he said Moroccan companies are not yet ready for the next stage of liberalising the dirham. 

The bank said it will continue to review policy decisions meeting by meeting, as global tensions and domestic climate risks still exist.

Reuters, APA News, Maghrebi.org