Morocco could face rising economic pressure as turmoil in the Middle East pushes up global energy and food prices, the European Bank for Reconstruction and Development warns.
The impact isn’t direct, the bank says, but moves through higher energy costs, disrupted supply chains, and tighter financial conditions.
Since early March, the price of crude has exceeded $100 a barrel, and any further disruptions in the Strait of Hormuz could drive costs even higher. Morocco relies heavily on energy imports, making it particularly sensitive to these global swings.
Before the tensions, Morocco’s energy deficit ranged between 5% and 11% of GDP. Higher energy costs could hit transportation, industrial production, and household budgets.
Despite this grim outlook, Morocco remains a major player in the phosphate-based fertilizer market. Rising global prices allow the country to earn more from exports, offering a buffer against energy shocks.
Still, this benefit is limited by higher production costs. Inputs like sulfur, which pass through Gulf countries, have surged due to supply disruptions, reducing the profit margin on exports.
The report also warns that rising fertilizer prices worldwide could push up food costs at home, fueling inflation.
Even with limited direct trade with Gulf countries, Morocco is exposed to indirect effects. Gulf countries supply essential industrial materials, including chemicals and metals, and any disruption can raise costs or delay production.
Tourism, however, is relatively safe, thanks to Morocco’s distance from conflict zones, keeping it attractive for travelers.
Similarly, remittances from Moroccans in the Gulf don’t play a major role in the economy, limiting financial risks from that region.
The bank cautioned that higher energy and food prices could force the government to expand support for families and businesses, straining public finances. Borrowing costs may also rise, making international financing trickier.
The EBRD described Morocco’s economic outlook as “mixed.” Rising costs linked to energy tensions are partially offset by export opportunities in fertilizers, but the wider geopolitical uncertainty makes the country’s economic path fragile and unpredictable.
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