Morocco's economy grew by 2.8% year-on-year in the third quarter thanks to industry
The recovery of domestic demand and the strong growth of exports have been the keys to growth
The latest data released by Morocco's High Planning Commission (HCP) reveals that the country's economy grew by 2.8% in the third quarter of the year, compared to the same period last year, and forecasts a growth of 2.5% for the last quarter of 2024.
Third quarter
According to the HCP's economic update report for the third quarter of 2024 and outlook for the fourth quarter, ‘this growth scenario is based on a moderate change in demand and takes into account the effects of mechanical adjustments. The main risks are related to export developments’.
The 2.8% growth in the July-September period has had much to do with the momentum of the industrial sector, while the performance of the agricultural sector has been rather subdued.
In any case, the quarter's growth was higher than the average for the first two quarters of 2024, which was 2.4%. The HCP attributes this to the recovery in domestic demand and strong growth in exports, which have increased the value of all sectors except agriculture and fisheries.
Industry pulls the economy
Excluding the agricultural sector, the Moroccan economy grew by 3.6% year-on-year in the third quarter, while the secondary sectors grew at a rate of 4.4%.
Particularly noteworthy was the role played by the extractive industries, with growth of 15.4% between July and September. These excellent figures were helped by the rebound in the export of raw materials, especially phosphates (whose production grew by 18.9%) and sustained demand from local processing industries.
Other sectors also recorded strong growth, such as chemicals (+9.7%) and construction (+4.8%).
Forecasts for the fourth quarter
Regarding the forecast for the period September-December 2024, the HCP estimates a slight slowdown in economic growth (+2.5%), due to less sustained growth in the volume of domestic exports of goods and services (+7.6% instead of 11.3%), affected by an adjustment in exports of manufactured goods. The export growth rate will slow down to 9.2%, compared to 14.4% in the previous quarter.
The HCP also stresses that household consumption will remain the mainstay of national economic growth in the fourth quarter of 2024, thanks to a faster pace of growth in their consumption expenditure, benefiting from gains in purchasing power stemming from higher social transfers and wages.
Consequently, the household saving rate should also turn upwards by the end of this year 2024, due to a resumption of real income growth and an improvement in bank deposits.
Difficulties are also expected to continue in sectors such as agri-food, due to weak local agricultural supply and rising costs for the meat, cereal and milk processing industries.
This weakness will result in the country's economic activity being driven mainly by the construction and services sectors. Economic growth in the fourth quarter, excluding agriculture, is expected to reach 3.2%.
The European Bank for Reconstruction and Development has projected growth of 2.9% in Morocco's economy for 2024 as a whole.
For its part, Bank Al-Maghrib, Morocco's central bank, has revised its growth forecasts for the country's economy, predicting a slight slowdown at the end of the year (+2.8%), followed by a rebound in growth (+4.4%) by 2025.
