Morocco’s development plan shows progress, but unemployment and inequality remain major hurdles

Morocco has made progress in expanding social protection, attracting investment and upgrading key public services over the past five years, but deep-rooted problems such as unemployment, inequality, corruption and economic rent-seeking continue to slow the country’s development ambitions, according to an assessment report by the Economic and Social Foresight Center.

The report reviewed the implementation of Morocco’s New Development Model, a long-term strategy launched to reshape the country’s economic and social future by 2035.

While the report highlighted gains in several strategic sectors, it warned that many Moroccans have yet to feel the full impact of the reforms in their daily lives.

One of the report’s strongest findings concerns the labor market. Despite major public and private investment programs, unemployment remained around 13% in 2025, affecting more than 1.6 million people.

Youth unemployment remained particularly high, exceeding one-third of the young population.

The report said many of the jobs being created are concentrated in low-productivity sectors that offer limited economic value and weak long-term prospects.

The assessment also pointed to a sharp decline in economic participation. Only 43% of working-age Moroccans were active in the labor market in 2025, while women’s participation fell to just 19%.

More than 1.5 million young people remained outside education, training and employment, a situation the report described as a major waste of human potential.

At the same time, the report acknowledged important achievements. Health insurance coverage expanded to more than 32 million people by 2025, covering roughly 88% of the population.

Direct social support programs reached around 12.5 million beneficiaries across nearly 4 million households.

Investment activity also accelerated. Public investment planned for 2026 reached MAD 380 billion, while approved investment projects totaled MAD 581 billion and are expected to create more than 245,000 jobs.

Foreign direct investment inflows increased from MAD 32 billion in 2021 to more than MAD 56 billion in 2025.

The report noted progress in education, healthcare governance and digital services.
Preschool enrollment reached 84%, while more than 600 public services were digitized as part of government modernization efforts.

Still, the report said that structural weaknesses continue to undermine development efforts. It cited poor educational outcomes, shortages in public healthcare facilities and the ongoing departure of hundreds of doctors abroad each year.

According to the assessment, nearly 90% of compulsory health insurance spending is directed toward private healthcare providers, increasing pressure on public hospitals.

The report warned that corruption, monopolistic practices and the large informal economy continue to weigh on growth. It estimated that the informal sector accounts for around 30% of Morocco’s economy, while corruption costs the country roughly MAD 50 billion annually.