Morocco stands out in the global economic landscape as one of the few emerging economies achieving steady recovery post-pandemic. Since 2022, non-agricultural sectors have expanded at an average annual rate of 4.4%, outpacing historical benchmarks and gradually offsetting losses incurred during the health crisis.
A recent policy paper published in July 2026 by the Policy Center for the New South examines this trajectory, authored by leading economists including Abdelaziz Ait Ali, Mahmoud Arbouch, Fahd Azaroual, Karim El Aynaoui, and Adnane Lahzaoui. Beyond current performance metrics, the study probes whether Morocco is undergoing a fundamental economic transformation or merely capitalizing on temporary global conditions.
Public investment: the backbone of economic revival
The report identifies public expenditure as the primary driver behind Morocco’s rebound. With an investment rate nearing 30% of GDP, the country ranks among the most proactive in its peer group. State-driven initiatives—spanning infrastructure, transportation, energy projects, and preparations for the 2030 FIFA World Cup—have accelerated recovery but also exposed structural weaknesses.
A significant portion of capital goods is imported, meaning the benefits of these investments often flow to foreign suppliers rather than domestic industries. This contributes to a persistent trade deficit, despite strong performances from export-oriented sectors.
Tourism and services emerge as new growth engines
Contrary to assumptions that manufacturing alone fuels Morocco’s economy, the study highlights the tertiary sector as the principal catalyst. Tourism, now approaching 20 million visitors annually, logistics, financial services, and engineering activities are driving value creation. Meanwhile, construction thrives on large-scale infrastructure projects, while agriculture remains vulnerable to climatic volatility.
Geopolitical tensions and supply chain realignment work in Morocco’s favor
The authors argue that Morocco is strategically positioned to benefit from today’s fragmented global economy. Trade tensions between major powers, post-pandemic supply chain disruptions, and industrial diversification strategies are prompting multinational corporations to seek production hubs closer to European and African markets.
The study cites Chinese investments in Morocco’s electric vehicle battery sector—such as Gotion High-Tech’s plant in Kénitra and CNGR’s facility in Jorf Lasfar—as emblematic of this new industrial dynamic. Morocco is steadily positioning itself as a “connecting state”, bridging value chains between Europe, Africa, and Asia through political stability, robust logistics, and favorable trade agreements.
Macroeconomic stability attracts foreign capital
Investor confidence is further bolstered by Morocco’s strong macroeconomic fundamentals: solid public finances, comfortable foreign reserves, a reduced sovereign risk profile, and improving fiscal health. Remittances from Moroccans abroad continue to bolster domestic demand, while improved terms of trade have mitigated the inflationary impact of external shocks.
The road ahead: balancing public and private sector roles
However, the paper issues a cautionary note about the sustainability of current growth drivers. The authors warn that over-reliance on public investment is unsustainable and identify three critical vulnerabilities: rising public debt, diminishing returns on infrastructure projects, and the persistent underperformance of the private sector.
Evidence suggests that today’s capital investment yields lower growth dividends than in the early 2000s, signaling declining efficiency in public spending. The private sector remains the weak link—hampered by limited access to financing, competition from informal markets, and the crowding-out effect of public sector borrowing on bank credit.
Services as engines of transformation
The report proposes a paradigm shift: instead of focusing solely on industrialization, Morocco should harness high-value service exports—such as tourism, IT services, digital solutions, and consulting—as drivers of economic transformation. Success depends on deep integration into global value chains and the creation of skilled employment opportunities.
Morocco at a crossroads
Ultimately, the study delivers a nuanced assessment. While favorable geopolitical conditions, strategic geography, and robust infrastructure offer Morocco a unique opportunity, these factors alone do not constitute a development strategy. The real challenge lies in converting this moment into durable prosperity through reforms in labor markets, education, innovation ecosystems, and business environments.
Morocco now holds a strategic advantage as a global “connecting state.” The question is no longer whether it can attract more investment, but whether it can turn its position into a sustainable engine for long-term wealth creation and shared prosperity.