The World Bank in Morocco

The World Bank in Morocco



With a growth rate of 7.9 percent, the Moroccan economy rebounded in 2021, recovering the output losses experienced during the first year of the pandemic. However, a series of overlapping shocks led to an abrupt deceleration of economic activity, and GDP growth dropped to just 0.3 percent in the first quarter of 2022. This was due to the impact of yet another drought, the third one in the last four years, which will lead to a sharp contraction in agricultural GDP. In addition, as an importer of energy and food, Morocco has been strongly impacted by the commodity price shocks triggered by the war in Ukraine.

Inflation has picked up in recent months, reaching 8 percent in August. The government has adopted various measures to mitigate the effects of these price pressures on households and specific sectors of the economy, including a substantial increase in the volume of public resources allocated to pre-existing subsidies on butane gas, flour, and sugar. This exerts additional pressure on public spending, although a rebound in tax revenues allows the government to reduce the budget deficit. In response to the inflationary surge, the central bank has increased the policy interest rate by 50 basis points to 2 percent, the first tightening of monetary policy since the beginning of the pandemic outbreak.

The authorities remain committed to an ambitious structural reform agenda aimed at placing Morroco on a more solid and equitable growth path. This effort has so far focused on the social sectors, with a historic move to universalize access to the national health insurance and family allowance systems. The government is also moving ahead with various policies that could unlock the private sector's potential. These include the reform of Morocco's large state-owned enterprise (SOE) system and a review of the investment charter. In addition, the operationalization of the Mohammed VI fund could help catalyze private investment in key sectors of the economy.

Climate risks are becoming increasingly apparent in Morocco. The current drought is causing a sharp reduction in cereal crops that coincides with the stress that global food markets are undergoing due to the war in Ukraine, posing a challenge to food security. In addition, the water volumes stored in Morocco´s main dams have hit historical lows, implying that should rainfall levels not recover in the coming months, various cities could begin to face severe shortages. The authorities are responding to this threat by accelerating the water desalination program.


Leveraging the combined strengths of the IBRD, IFC, and MIGA, the World Bank Group’s (WBG) Country Partnership Framework for Morocco (CPF), approved at the Board on 19 February 2019, incorporates the objectives of government programs that covered the five-year period 2017-2021, such as the National Initiative for Human Development. The Bank’s CPF FY2019 to 2024 contains the overarching goal of improving conditions for growth and job creation by pursuing three areas of strategic focus: (a) promoting job creation by the private sector; (b) strengthening human capital; and (c) promoting inclusive and resilient territorial development. Improving governance and citizen engagement are its foundational principles and are strongly complemented by attention to gender and the digital economy, which represent its cross-cutting themes.

The World Bank is currently conducting a mid-term review of the Country Partnership Framework while readying a Country and Climate Development Report (CCDR), to be launched in November 2022.

Most recently, the World Bank approved the following activities in Morocco:

  • ENNAJAA program: In December 2021, US$450 million was approved to support key governance reforms in Morocco as part of the government’s ambitious strategy to modernize the public sector. Morocco has embarked on long-term, wide-ranging reforms to improve the overall performance of the public sector and citizen-state engagement. Building on past World Bank governance programs in Morocco, the Public Sector Performance (ENNAJAA) Program for Results (PforR) aims to improve the performance and transparency of government operations and service delivery.
  • Resilient and sustainable agriculture in Morocco: In March 2022, US$180 million was approved to support resilient and sustainable agriculture in Morocco. Climate change and population growth is putting increased pressure on water and land resources. The Resilient and Sustainable Water in Agriculture (RESWAG) project aims to improve the governance of water in agriculture and quality of irrigation services and increase access to advisory services for irrigation technologies.
  • Blue Economy Program for Results: In May 2022, US$350 million was approved to develop Morocco's institutional frameworks, improve integrated management of natural resources, and strengthen selected sectors for a climate-resilient blue economy in Targeted Areas. The program aims to improve job creation and economic growth, as well as the sustainability and resilience of natural resources and food security, which has increased in importance given the impacts of the war in Ukraine.
  • North-East Economic Development Project: In June 2022, US$250 million was approved to improve connectivity and enable private sector growth in the project area. The funding will help to improve transport connectivity and enable private sector growth in North-East Morocco, notably around the development of the Nador West Med (NWM) maritime complex.  The project has three main components: to strengthen the integrated territorial development approach in the North-East Region, to support private sector development, and to improve road infrastructure. The project will finance the development of a priority investment roadmap, the improvement of 500 kilometers of rural roads, and the skills building of 5,000 young workers, with an emphasis on women and rural youth. It will also support reforms aimed at increasing private investment by US$30 million in the region and rehabilitate 170 kilometers of primary roads.
  • Strengthening Human Capital for a Resilient Morocco DPF: In June 2022, the World Bank Board of Executive directors approved a US$500 million loan aimed at improving protection against health risks, human capital losses during childhood, poverty in old age, and climate change risks. This is the first in a series of three operations that support a government reform program that is also financed in parallel by other development partners. The program is built around three areas. The first aims to help protect Moroccans, particularly climate-vulnerable populations, against health risks with a focus on those caused by climate change. The second will support the harmonization of all social protection schemes focused on children into an integrated program of family allowances and expanding its coverage, improving the targeting of family allowances and other schemes through a unified social registry, and implementing a new pension regime for non-salaried workers. The third aspect will support the government in strengthening the institutional and coordination framework for disaster and climate-related risk management; the development of new mechanisms to protect vulnerable farmers against droughts and other extreme climate events; and provision of relief for the effects of the delay of rainfall during the 2021-2022 agricultural season.


The following results are expected under each CPF strategic area of focus:

  • Promoting Job Creation by the Private Sector: Creating a more efficient environment for business and competitiveness while leveraging disruptive technologies; increasing opportunities for private sector growth, with a focus on micro, small and medium Enterprises and youth employability; and increasing access to finance.
  • Strengthening Human Capital: Focused on improved access to quality early childhood development services; improved quality and effectiveness of education systems; improved quality and efficiency of health delivery systems; and strengthened social protection for the poor and vulnerable.
  • Promoting Inclusive and Resilient Territorial Development: Focusing on improving the performance of key infrastructure delivery services of cities and agglomerations; improved access to sustainable water resources; and enhanced adaptation to climate change and resilience to natural disasters.

The foundation of the CPF supports Governance and Citizen Engagement and focuses on the objectives of (i) improving the efficiency of public spending; and (ii) improving transparency and developing the building blocks for effective citizen-state engagement.

Ultimately, the first cross-cutting theme “Gender” is applied through a consistent gender focus in all ongoing and new operations as well as analytical studies with the objective of empowering women and girls for shared prosperity. Moreover, the second cross-cutting theme focusing on digitalization supports each of the CPF focus areas by creating enabling conditions for improved access to digital technologies.

Last Updated: Oct 20, 2022

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