Casablanca, 29 November 2018
Finance for Impact presented its International Trade Assessment for Morocco.
Despite many economic and pro-business reforms adopted in past years, Morocco finds it difficult to diversify its economy. The trade deficit remains important (USD19.5 billion in 2017, with imports reaching USD45.1 and exports USD25.6). Similar to several countries in the region, Morocco’s exports comprise of various products, some of them with low income elasticity, e.g. clothing, fish, vegetables… This carries negative implications for the economic growth, as the demand for these products do not grow as fast as the income of their trading partners increases.
Despite this persisting trade deficits and other non-tariff barriers, our assessment noted that Morocco enjoys a competitive advantage for cross-border trade with some regions. For instance, excellent trade infrastructure, including modern ports such as Tanger-Med, makes Morocco in a good position to capture value from cross-border trade with Africa. Morocco, as a regional hub, enjoys significant a first-entrant position in many Sub-Saharan countries, e.g. Ethiopia, Mauritania, Senegal, Nigeria and Côte d’Ivoire. Exports between Morocco and these five countries have been on an upward trend over the past years, raising from USD602 in 2013 to USD925 in 2017. Morocco has also successfully built trade relations with many other countries, including Ghana, Mali, Guinea, Cameroon, Benin, Mozambique, and Burkina Faso, among others.
For the years to come, demand for cross-border trade is expected increase. Unrealized (postponed) Morocco’s export trade potential is estimated at USD15 billion with the world. Demand is expected to be satisfied in the near future because Morocco has heavily invested in infrastructure over the years, thus building a strong comparative advantage for doing business with several regions.