Morocco scored a “B” grade within the “Coface Network” scale, which measures the economic risks associated with “contracting defaults” across 162 countries from around the world, placing the Kingdom in the “relatively high risk” category.
With expectations of a “dark winter for the global economy,” according to the third quarter of 2022 forecasts, Morocco ranked relatively high compared to its neighboring countries in North Africa.
Algeria, Tunisia and Mauritania were classified as high-risk countries, while Libya was classified as “extreme risk.”
The scale put Morocco on the list of countries with a “suitable business climate,” with an A4 rating out of 162 countries, within a rating ranging from A to E.
Coface data enumerated Morocco’s strengths in recent years, including “favorable geographical position due to its proximity to the European market,” and the adoption of “a strategy to expand and diversify production in several industrial sectors,” and “political stability and commitment to reforms.”
The index confirmed that Morocco benefits from “increasing integration into the African market and strengthening partnerships, particularly south-south,” while it benefits from the support of the international community, especially in Europe, which supports green investment projects in Morocco with a ceiling of USD300 million.
“A country with a growing and expanding market,” the index mentions the weaknesses of the Moroccan economic climate saying: “the economy depends heavily on the performance of the agricultural sector, as it represents 12% of GDP and 30% of overall employment.”
This makes Morocco “dependent on the climate and the availability of water,” says the index, adding that another risk-inducing factor is the Kingdom’s concentration of the bulk of its economic relations and trade balance with the European Union.
The intensification of “Morocco’s economic competition” by other Mediterranean countries such as Turkey and Egypt,” the “great social and spatial disparities between cities and rural areas,” and the persisting high rate of poverty are also noted as possible risks for future foreign investors in the country.
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