Morocco Country Risk Report

Published 26 August 2015 | Quarterly

  • 42 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
$1,195.00
Morocco Country Risk Report

Core Views

  • Despite not possessing hydrocarbon wealth, the economy will remain a relative outperformer in North Africa over the medium term. Investor interest in the country as an export-oriented manufacturing hub for the European market and increasingly to West Africa, coupled with a burgeoning tourism industry, will bode well for Morocco's underlying growth momentum in the next few years.

  • Morocco's foreign policy will remain stable over the coming years, aimed at strengthening its relationship with the EU and the GCC and looking to West Africa for trade and investment opportunities. The Western Sahara issue will remain at the forefront of Rabat's foreign policy agenda, and we do not see any significant progress taking place on this issue in the near future.

  • Morocco will outperform in the MENA region in 2015 and 2016, on the back of a good harvest, improvements in the external sector, and a strong investment outlook. We forecast real GDP growth to reach 4.5% over 2015 and 4.0% in 2016, significantly up from 2.6% in 2014.

  • The gradual coming on-stream of new energy sources over the next five years - as part of the National Energy Plan 2020 - will reduce pressures on Morocco's current account and boost the country's attractiveness for foreign investors. This structural evolution will benefit the country's economic growth over the next decade.

  • Annual inflation in Morocco will pick up to 1.4% in 2015, compared to 0.4% in 2014, amid rising food prices and stronger economic growth. This will allow the Central Bank to maintain its current benchmark interest rate at 2.50% throughout the year.

Key Risks To Outlook

  • Our forecasts for both economic activity and fiscal policy assume that Morocco will benefit from significant inflows of foreign aid from the Gulf Cooperation Council (GCC) and other organisations over the coming years. Should this assistance fail to materialise, it would pose serious downside risks to the country's outlook.

  • The export sector...

Executive Summary
5
Core Views
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Foreign Policy
8
Foreign Policy Stability
8
table: POLITICAL OVERVIEW
8
Long-Term Political Outlook
10
Challenges For The Coming Decade: Scenarios For Change
10
Chapter 2: Economic Outlook
13
SWOT Analysis
13
BMI Economic Risk Index
13
Economic Activity
14
Regional Outperformer Over The Coming Years
14
table: Economic Activity
14
table: Various Countries, Real GDP Growth, % chg y-o-y
15
Economic Policy
17
Energy Diversification To Boost Long-Term Growth
17
table: Current Account
17
Monetary Policy
19
Low Inflation Will Drive Interest Rate Stability
19
table: Monetary Policy
19
Regional: Private Consumption
20
Private Consumption: Saudi, UAE, And Egypt Lead The Way
20
tab le: MENA - REAL PRIVATE CONSUMPTION GROWTH, %
21
tab le: MENA - PRIVATE CONSUMPTION, USD PER CAPITA
22
Chapter 3: 10-Year Forecast
25
The Moroccan Economy To 2024
25
Diversified Economic Base Underpins Bright Future
25
table: Long-Term Macroeconomic Forecasts
25
Chapter 4: Operational Risk
29
SWOT Analysis
29
Operational Risk Index
29
Operational Risk
30
table: Operational Risk
30
Legal Environment
31
table: MENA Legal Environment Risk
32
Costs Of Labour
34
table: MENA Labour Costs Risk
34
table: Regulations Governing Flexibility Of Workforce
35
table: Foreign Worker Visa Requirements To Enter
35
Chapter 5: BMI Global Macro Outlook
37
Global Outlook
37
EMs Still Slowing
37
Table: Global Assumptions
37
Table: Developed States, Real GDP GrowtH, %
38
Table: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
38
Table: Emerging Markets, Real GDP Growth, %
39

The Morocco Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Morocco. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Morocco's economic, political and financial prospects through end-2019, just published by award-winning forecasters, BMI Research.

Key Uses

  • Forecast the pace and stability of Morocco's economic and industry growth through end-2019.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Morocco's country risks against regional peers using BMI's country comparative Risk Index system.
  • Evaluate external threats to doing business in Morocco, including currency volatility, the commodity price boom and protectionist policies.

The Morocco Country Risk Report by BMI Research includes three major sections: Economic Outlook, Political Outlook and Operational Risk.

Economic Outlook:

How will the Morocco' economic policy-making and performance impact on corporate profitability over 2015-2019?

BMI provides our fully independent 5-year forecasts for Morocco through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Morocco Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector obligations).
  • Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Morocco and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Morocco, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Morocco over the next 5-years?

BMI's Morocco country Risk Index evaluates the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Morocco Market - Political Strengths, Weaknesses, Opportunities and Threats facing Morocco.
  • Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Morocco's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
  • Long-Term Political Outlook BMI examines the structural risks to the stability of Morocco’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.

Key Benefits

  • Benchmark Morocco's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Operational Risk

What are the current operational risks and difficulties associated with doing business in Morocco?

The Operational Risk section gives an evaluation of current risks and difficulties associated with operating in the market. It also provides a brief overview of the regional Operational Risk Index which benchmarks Morocco against its neighbours.

Operational Risk Contents

The chapter provides a summary of the main threats in the country, within:

  • Labour Market Risk (Education; Availability of Labour; and Labour Costs)
  • Logistics Risk (Market Size and Utilities; Quality and Extent of the Transport Governance)
  • Trade and Investment Risk (Economic Openness; Government Intervention; and Legal Risks)
  • Crime and Security Risk (Crime; Terrorism; and Interstate Conflict risks).

The report also drills down in greater depth to address key issues in one of the following segments most critical to the market:

  • Transport network, economic openness, cost and availability of labour, crime risks, bureaucratic environment, market size and utilities, and interstate conflict.
  • Assess your company’s exposure to country specific operational and business risks, using BMI’s insight on the current dangers of operating in the market.
  • Evaluate Morocco’s risk profile against its regional peers, helping you understand the market’s strengths and weaknesses in relation to other countries.

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