Morocco

Morocco has consolidated its position as North Africa's most credible diversification story, combining a stable monarchy, deep EU/US trade integration, and a multi-year investment supercycle. The IMF estimates real GDP growth accelerated to 4.9% in 2025, with the fiscal deficit narrowing to about 3.5% of GDP and public debt on a declining path — anchored by an IMF Flexible Credit Line, an unusual mark of macro credibility for an emerging market.

The momentum is structural. Morocco is now Africa's largest car producer (~614,000 vehicles in 2024), with automotive its top export at roughly $17bn. A $35bn green-hydrogen pipeline, OCP's $13bn green-fertiliser programme, record 17.4m tourists, and a $10bn-plus World Cup 2030 infrastructure build are layering demand across construction, energy and logistics at once. Tangier Med — Africa's busiest container port — and 14km proximity to Spain give Morocco a structural nearshoring advantage.

The risk profile is concentrated but real. Water is the binding constraint: a seven-year drought, declared over in January 2026, is forcing a $14bn-plus desalination build-out. Unemployment remains elevated near 13%, a jobless-growth vulnerability. The Western Sahara question — increasingly resolving in Morocco's favour — is a tailwind for southern-province investment but a residual geopolitical sensitivity.