For a prosperous and just Morocco, real economic competition and increased transparency are more essential than ever, affirmed a recent analysis published by the American think tank “Atlantic Council” specializing in international relations.
The analysis called “The Moroccan government must promote greater economic competition” and developed by Rabah Arezki, former vice-president of the African Development Bank (AfDB), highlights the central role of competition in boosting economic growth. Moroccan economy, particularly within strategic sectors. Here is what emerges from this document.
Evolution of freedom: An ambivalent journey
Over the past three decades, Morocco has recorded significant progress in its institutions, as evidenced by the evolution of the Freedom Index. As the country navigated through the Arab Spring, it managed to maintain an improvement in its indicators, thus standing out from a MENA region marked by a general decline since 2013, with a gap of more than eleven points to its advantage. . However, several areas still require in-depth reforms to establish truly free and transparent institutions.
The economic index saw a notable change in 2004, with an increase of more than eight points, showing a break from its neighbors. This jump is mainly attributed to the adoption of the Moudawana, a revolutionary Family Code which expanded the economic and civil rights of women, affecting aspects such as marriage, divorce, and access to work and credit .
Traditionally open to international trade, Morocco signed an association agreement with the European Union in 2000, establishing a free trade zone and boosting its exports. However, this focus on Europe has hampered its economic integration with countries in the Middle East and Africa. Accession to the African Continental Free Trade Agreement in 2018 should, however, boost its trade with the rest of the continent in the years to come.
However, the reality of the Moroccan market remains tainted by strong sectoral concentration, particularly in non-market segments, limiting fair competition. To encourage productivity and job creation, it is crucial to ensure balanced competition.
Politically, Morocco has a complex structure. The new Constitution adopted following the Arab Spring aimed to strengthen democracy, judicial independence, and the protection of the rights of women and minorities. Although independence and judicial efficiency scores have improved, the centralization of power remains problematic. Although political rights are better protected there than in other countries in the region, they remain below international standards. Freedom of expression, although recognized, is often hampered, preventing the media from fully playing their role in monitoring public affairs.
On the other hand, efforts to reduce informality demonstrate a desire by the authorities to integrate the informal economy into the formal system, but this challenge remains complex. The persistence of poverty, especially in rural areas, highlights the need to adopt an inclusive rather than coercive approach, facilitating access to the formal sector and contributing to shared prosperity.
Evolution of prosperity: Obvious improvements
-Since 1995, the evolution of the prosperity index reveals a notable improvement in the standard of living in Morocco, thus reducing the gap with the average for the MENA region. However, it should be noted that this average includes oil-rich and less densely populated countries, mainly the Gulf monarchies, which contributes to maintaining this disparity.
A key element having strengthened social cohesion and the protection of minorities in Morocco is the recognition of the Berber language as an official language in 2011. This historic advance has generated positive repercussions, although it remains to be determined its effect on the reduction of regional to medium inequalities term.
In contrast, significant regional inequalities persist in areas such as income, education and health. The economic prosperity of recent decades has mainly benefited urban populations, attracting the majority of investments and public policies, leaving significant pockets of poverty in rural areas.
The education system illustrates this duality, access to primary education is now universal, but the quality of education varies widely, being significantly lower in rural areas compared to urban areas. This finding is similar in the health sector, where marked disparities between urban and rural areas remain problematic.
The way forward for Morocco’s economic development
Although Morocco has made significant progress in its economic transformation, imbalances persist. On the one hand, some regions are experiencing rapid growth, while others, particularly rural areas, continue to face acute poverty. In 2021, the country initiated a new development model focused on the development of human capital and social inclusion, but economic growth remains modest and the high level of debt limits budgetary room for maneuver.
To avoid falling into the middle-income trap, characterized by low growth and persistent poverty, Morocco must strengthen competition and market structure. The telecommunications sector is a good example of anti-competitive abuses which hamper the quality of the services offered.
Lack of access to essential technologies, such as affordable internet, also complicates the situation, exacerbating disparities between urban and rural areas. Clientelism and rent-seeking practices must be combatted to foster a dynamic investment environment.
Additionally, Morocco must improve its government transparency and data disclosure to boost contestability in markets. By promoting strong competition and strengthening transparency, Morocco will be able to better direct its development towards sustainable and inclusive growth.
