Amid regional instability, Morocco remains a source of sustainable progress

A melting pot of indigenous Berber, African, Arab and European influences, the kingdom of Morocco, meaning “the West” in Arabic, is the world’s most-westerly Arab country, located at the apex of north-west Africa and across the 14-km Strait of Gibraltar from Spain. Having benefitted from its advantageous geographic location and diverse cultural heritage for centuries, Morocco has been able to accommodate its cultural diversity in a stable and politically inclusive system. While upheavals have significantly altered the political geographies of neighbouring countries in recent years, Morocco – North Africa’s only constitutional monarchy – has fortified its position as an international trade centre by increasingly liberalising its economy and attracting foreign investment. It has not only deepened its economic and security ties with the EU, but also with the Gulf states and China. Most recently, Morocco rejoined the African Union after a 30-year hiatus, epitomising its enduring influence across the continent.

GEOGRAPHY: Encompassing an area of 710,850 sq km, Morocco is nearly twice the size of Japan and shares borders with Algeria, the Spanish enclaves of Ceuta, Melilla and Peñón de Vélez de la Gomera, as well as Mauritania. With a population of over 3.5m and located on the Atlantic coast, Casablanca is Morocco’s largest city and economic centre. Situated 90 km north of Casablanca lies Rabat, the kingdom’s political capital and second-biggest city. Dubbed as the world’s largest medieval city, Fez, the former royal capital in the north, is another major population centre along with its sister city Meknès, home to nearly 1m inhabitants. The kingdom’s oldest city, Tangiers, is a major port city with 1m residents at the foot of the Strait of Gibraltar, which has also become an industrial centre in recent years. Lastly, Marrakech and Agadir are two other major cities that have become renowned worldwide as popular tourist destinations in the kingdom’s south.

CLIMATE & TOPOGRAPHY: Though the climate across Morocco’s 1835-km coastline can best be described as Mediterranean, the country’s naturally diverse hinterland is marked by high variations in climate due to mountainous ranges, grassy plateaus and hot deserts. With average temperatures above 25°C, July and August are the hottest months, while the months of November to March are usually the wettest. Elevation extremes also define the country’s three topographical zones; Morocco’s northern grassy plains provide fertile ground for agricultural production, while the Rif region in the far north is a mix of plains and mountains. Ranging across Morocco, Algeria and Tunisia, the Atlas Mountains, divided into the sub-ranges of the High Atlas, Middle Atlas and Anti-Atlas, form the third topographical zone. Located 60 km south of Marrakech, Jebel Toubkal is North Africa’s highest peak, and towers 4165 metres in the High Atlas, which also accommodates Oukaimeden, Africa’s most elevated ski resort.

ECONOMY: Being well diversified, growth in Morocco’s economy has been spearheaded by its agricultural output, mining industry, manufacturing sector, proximity to Europe, diaspora remittances and low labour costs. The agricultural sector in particular has a decisive impact on annual growth rates, as fluctuations in rainfall may either boost or dampen GDP growth expectations. The agricultural sector currently contributes 15% to Morocco’s GDP and employs nearly 45% of the workforce. Further capitalising on its proximity to Europe, tourism is another major contributor to GDP. Some 11.4m tourists visited Morocco in 2017, generating €6.2bn in revenues. Moreover, the burgeoning manufacturing industries, notably aeronautics, automotive, textiles and apparel, have been spurred by government efforts to increase the sector’s GDP contribution from 14% in 2014 to 23% by 2020. At the same time, recent years have seen investments into Morocco’s expanding ICT sector, particularly outsourcing.

The kingdom’s increased economic interconnectedness with its trade partners has also led to a bulking up of investments into its port and logistics infrastructures, particularly the establishment of free trade zones and the Tanger-Med port, which has further boosted Morocco’s competitiveness across Africa.

Having suffered a deficit of more than 12% of GDP in the early 1980s, Morocco embarked on a range of austerity measures and market reforms that jump started its economic recovery. The economy has remained resilient under the rule of King Mohammed VI, who ascended the throne in 1999 and who has made political stability a pivotal factor behind Morocco’s strong growth rates over his 18-year reign. According to the IMF, GDP is estimated to grow by 3% in 2018 and 4% in 2019, following a poor agricultural season that brought GDP growth down to 1.1% in 2016.

Close to 500,000 small and medium-sized enterprises are currently registered in Morocco and form the backbone of the kingdom’s economy. In its “Doing Business” 2017 report, the World Bank noted numerous improvements in the business environment, particularly regarding property registration, access to credit, the protection of minority investors, cross-border trade and contract enforcement, among others.

Morocco’s transformation into an export-oriented player has been facilitated through trade liberalisation, with the signing of a bilateral free trade agreement with the US in 2004 and an “advanced status agreement” with the EU, signed two years later. The latter remains Morocco’s biggest trading partner, with trade volumes totalling €34.6bn in 2016. According to the European Commission, Morocco imported €20.8bn from the EU and exported €13.8bn to the bloc. Between 2012 and 2016 exports to the EU grew at an annual rate of 10.3%.

Labour costs are also low in Morocco, as the monthly minimum wage currently stands at Dh1350 (€125) and was set to increase to Dh1500 (€139) in January 2018. After 2016 witnessed 19.6% growth in the trade deficit due to an increase in both wheat and equipment imports, Morocco’s trade deficit grew by 2.8% in 2017 on higher raw food prices and a rising energy bill, reaching a total of Dh190.2bn (€17.6bn).

NATURAL RESOURCES: Morocco is home to almost 75% of the world’s phosphate reserves and production accounts for 90% of domestic mining activities. Having monopolised extraction and marketing of phosphates, the formerly state-owned OCP has followed a sustainability strategy to ensure African food security through fertiliser products, outlining a substantial investment programme both at home and elsewhere on the continent through 2025. The remaining 10% of the domestic mining sector includes the extraction of iron ore, manganese, gold, copper, silver, lead and zinc.

In contrast to many of its North African neighbours, however, Morocco does not possess significant oil and gas reserves and continues to be a net energy importer. Although a low oil price environment has enabled Morocco to reduce its fuel and hydrocarbons import bill in 2016, the kingdom is keen to develop offshore oil and gas production facilities, having drawn in companies such as Qatar Petroleum, Chevron and BP. According to the US Department of Energy, Morocco accommodates 3.5% of known global oil shale reserves.

Having been at the forefront of developing solar and wind facilities, Morocco further envisages meeting 42% of its total energy needs with renewable sources by 2020. The first phase of the world’s largest solar power project, a 580-MW plant in Ouarzazate, started operations in February 2016, while phases II and III are due to come on-line in early 2018.

With 67.5% of land used for agricultural purposes, Morocco’s fertile north has become the country’s breadbasket, and a lack of rainfall correlates with lower economic growth. Main crops include cereals, grapes, citrus fruits and olives. Fish and seafood have also become increasingly important, as Morocco is the world’s largest processor and exporter of sardines, with the cities of Essaouira, El Jadida, Larache, Safi and Agadir constituting the country’s main fishing centres.

POPULATION: Since 1957 Morocco’s population has more than tripled, rising from 11.2m to 35.3m in 2016, according to UN estimates. The Atlantic coast, along which the major cities are located, and the grassy northern plains are home to the majority of the population. Having a median age of 28.9, Morocco is a young country, with 26% of its population under the age of 14 and 17.2% between 15 and 24 years old. The population is growing at 1.3% per year, according to the World Bank. Similar to other developing countries, Morocco has experienced a rural exodus, with the urban population having risen by more than 30% over the last 60 years. Rapid urbanisation has been a contributing factor to a national youth unemployment rate of 26.5% in 2017, which remains one of Morocco’s most pressing challenges. National unemployment was 10.2% in late 2017.

LANGUAGE & ETHNICITY: Tamazigh, also known as Berber, and Arabic are Morocco’s official languages. The former became an official language in 2011, following the new constitution. The Berbers are the indigenous people who inhabited the Maghreb region before the Arab conquest and their influence facilitated the spread of Maghreb Arabic or darija, which is spoken in Morocco, Algeria, Tunisia and Libya. The three main Berber dialects in Morocco are Tarifit, Tamazigh and Tashelhit. The kingdom’s past as a former French protectorate still manifests itself today in view of the noticeable influence of French language and culture. French is not only the most widely spoken lingua franca in Morocco, but is also the main language used by the business community and the middle and upper classes, and also in higher education. While Spanish is commonly spoken in Morocco’s north-east, English is also becoming increasingly popular, notably among young people.

RELIGION: The 2011 constitution defines Islam as the official state religion, as 99% of the population is Muslim. The vast majority of Moroccan Muslims are Sunni and adhere to the Malekite rite, which is the predominant of the four Sunni schools of jurisprudence in the Maghreb region. King Mohammed VI is regarded as the leader of the country’s religious community and the constitution has granted him titles such as “Commander of the Faithful” and “Defender of the Faith”. While Morocco is tolerant and moderate, Islamic customs have an important function in Moroccan society.