Morocco’s Economic Growth Slows to 2.8%, Driven by Domestic Demand

While the agricultural sector is the most affected, posting 3.2%, the non-agricultural activities are showing a clear progression of 3.8%. For its part, domestic demand has been identified as the engine of growth.

The first quarter of the current year has not been favorable to the Moroccan economy. However, domestic demand remains the engine of growth, with the same downward trend in inflation, while the financing needs of the national economy have shown a relative improvement.

One of the most important remarks remains the added value of the primary sector, which experienced a 1.1% decline, in volume, in the first quarter of the current year, instead of 3.1% during the same period in 2018. The reason, according to the HCP, would come from the 3.2% drop in agricultural activity, but also from the increase in fishing: 18.4%, instead of a 6% drop.

At the industry level, particularly in the extractive industry, the growth rate has regressed, posting a rate of 5.6%, compared to 16.7% in 2018. The same observation at the level of the manufacturing industries which fall to 2.5%, against 3.5% the previous year.

All these elements, added to the slowdown in the growth of taxes on net products less subsidies (1.9% instead of 4.9%), have allowed an increase in the Gross Domestic Product (GDP), in volume (2.8%), in the first quarter of 2019, instead of 3.5% a year earlier, according to the same source.

For its part, domestic demand has proven to be a real engine of growth, with a growth rate of 3.3%, compared to 4.3% in the same period last year. All factors that contributed 3.6 points to national economic growth, instead of 4.7 points a year earlier, the HCP added.