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FDI into Morocco up 20% after business-friendly reforms

Morocco FDI market food Marcin Jamkowski/Adventure Pictures/Alamy via Reuters
Lower prices for volatile food products have helped drive down inflation in Morocco
  • $1.6bn FDI inflow in year to May 2024
  • Second-highest figure in country’s history
  • Inflation drops to 2.1%

Foreign direct investment into Morocco was up by almost one-fifth year on year through to the end of May 2024, a rise attributed to business-friendly government reforms.

Morocco attracted MAD16.1 billion ($1.6 billion) in FDI over the period, believed to be the second highest level in the history of the national economy, according to government spokesman Mustapha Baitas.

The country has set a target of mobilising MAD550 billion of private investment and creating 500,000 jobs between 2022 and 2026.

In 2023 it launched the New Investment Charter, which is intended to make Morocco attractive to both foreign and domestic investment, with incentives, subsidies and grants to interested companies.

Baitas, whose title is delegate-minister to the head of government in charge of relations with parliament, said that, since the introduction of the charter, the National Investment Committee has met five times, during which 115 projects have been approved, worth a total of MAD173 billion, creating 96,000 new jobs.

The minister said 82 percent of the projects have started, and “will have a significant impact” on FDI into Morocco, “as well as on national private investment”.

Morocco’s central bank reduced its benchmark interest rate to 2.75 percent last month, down 25 basis points, the first change in almost a year, amid falling inflation.

Inflation was 6.6 percent in 2022 and 6.1 percent in 2023 but has returned to low levels, averaging 2.1 percent over the first five months of 2024, driven by easing external pressures and lower prices for volatile food products.

Bank Al-Maghrib said inflation should remain close to this level until the end of 2025 before rising to 2.7 percent in 2025.

In May, the African Development Bank launched its €12 billion ($13 billion) five-year strategic roadmap to support Morocco’s economic growth.

The strategy prioritises two main areas: promoting inclusive growth through skills development, employment and entrepreneurship; and bolstering economic resilience to external shocks by deploying sustainable infrastructure.

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