Morocco's economic, political and security landscape: Key risks from this week

Welcome to this week’s edition of our Weekly Risk Watch, offering insights into economic indicators, political shifts, and security updates that could impact your business or daily life, all in one concise package.

Economy and Markets:

• Chicken prices have become a concern for Moroccan consumers, especially those with low incomes, as the price per kilogram reached 26 MAD in several cities far from the Kenitra-Jadida axis, while staying above 23 MAD in other cities, raising questions about the reasons for this increase despite the usual factors like weddings, tourism, and the summer influx of expatriates, with poultry farmers blaming high chick and feed costs and accusing large hatcheries and feed companies of reducing production and refusing to lower prices despite a global decline in raw material costs.
• From 2023 to September 2024, Morocco’s financial courts issued 3,951 auditing and account verification decisions, including 3,190 account clearances and 761 deficit cases totaling 54.85 million MAD, while recovering 28.18 million MAD, imposing 5.06 million MAD in fines, ordering the return of 9.15 million MAD, referring 16 cases for prosecution, and emphasizing reforms to enhance public finance management.
• The Office des Changes has launched investigations into Moroccan and foreign tech companies over suspicious import transactions, focusing on invoicing irregularities, transfer pricing, and potential collusion to inflate prices and increase foreign currency transfers, while collaborating with customs and tax authorities to ensure compliance with foreign exchange laws and prevent financial abuse.
• A recent World Bank report revealed that Morocco’s external debt surged to $69.267 million in 2023 from $27.3 million in 2010, with public and publicly guaranteed debt accounting for $45.117 million, primarily from multilateral creditors, while the report highlights significant increases in long-term external debt stocks from $23.7 million to $55.3 million, and private creditor debt rising from $1.3 million in 2010 to $12.5 million in 2023, alongside rising interest payments on long-term debt from $851,000 million to $1.4 million.
• In 2023, Morocco’s GDP reached 1,463.3 billion MAD, a 10% increase from 2022, with the corporate sector contributing 45.1%, household disposable income growing by 9.6% to 996 billion MAD, and a rise in Gross National Disposable Income (GNDI) by 9.7%, while households’ consumption expenditure accounted for 88.9% of their income, resulting in a savings rate of 11.4%, and a per capita disposable income increase to 26,903 MAD.
• Despite the government’s campaign to import fresh (chilled and frozen) meat to lower prices, there has been no noticeable decline in prices, with challenges such as limited availability, and market instability in cities like Casablanca and Fes.
• Amid signs of a new drought season on the horizon, livestock prices in Moroccan markets continue to soar to unprecedented levels, making it unaffordable for many rural residents and small farmers, leading to the concentration of livestock ownership in the hands of wealthy individuals, despite the challenges in securing feed and pasture.
• The High Commission for Planning reported a 9.2% increase in the industrial production index for manufacturing (excluding oil refining) in the third quarter of 2024 compared to the same period last year. 
• The National Financial Information Authority referred 71 cases of money laundering and terrorism financing to public prosecutors in various cities, marking a 31.48% increase in the number of cases referred compared to the previous year, with fraud, document forgery, and other forms of financial crime such as sports betting and cryptocurrency emerging as key concerns, while the number of suspicious activity reports surged to 5,777 in 2022, up from 1,088 in 2018, reflecting a 10.93% increase.

Polical stability:

• The 2024 UNODC Global Report on Trafficking in Persons revealed that Morocco detected 217 human trafficking victims in 2022, up from 187 in 2021,  a 25% increase from 2019, reflecting improved detection efforts but highlighting persistent vulnerabilities, with women, girls, and children particularly at risk, and a growing trend of transnational trafficking exacerbated by global crises.
• The fate of remaining Moroccan ISIS members in Syria is under scrutiny after the collapse of Bashar al-Assad’s regime last week, with concerns growing about the conditions of their wives and children in SDF-controlled camps, and the National Coordination for the Families of Moroccans Detained or Stranded in Syria and Iraq urging the Moroccan government to repatriate them amid worsening conditions.
• In 2023, the Supreme Judicial Council referred 55 judges to the disciplinary council for misconduct, issuing various penalties, including dismissals, forced retirements, and temporary suspensions.
• Justice Minister Abdellatif Ouahbi confirmed that alternative sentences will be implemented in August 2025, with all related measures, including regulatory decrees, set to be finalized by May 2025, while emphasizing the importance of providing fair trial conditions and ensuring citizens respect the judiciary.
• Tensions are rising in the Ain Sebaa district of Casablanca as efforts to hold an extraordinary session to dismiss its current president, from the Popular Movement Party, gain momentum, with representatives from the government coalition parties working to gather enough support to trigger his removal.
• Interior Minister Abdelouafi Laftit received complaints from councilors across both the majority and opposition in municipal councils within the Casablanca-Settat region, concerning questionable tax exemptions granted to landowners for undeveloped urban land based on administrative certificates signed by local officials, with many complaints submitted through the national complaints portal, asking for clarification on the basis for the exemptions and taxation decisions.
• Agricultural workers in the Chtouka Ait Baha region are demanding an increase in their daily wages from 75-80 MAD to 150 MAD, along with recognition of the time and burdens associated with commuting to work, prioritization of local workers for employment, improved safety and dignity in the workplace, elimination of wage discrimination, and an end to job insecurity due to short-term contracts facilitated by intermediary companies.
• Authorities in the Casablanca-Settat region banned a planned protest by taxi drivers seeking to show solidarity with a colleague arrested for allegedly assaulting a Russian official.
• Local authorities in Casablanca have launched a widespread campaign to combat the occupation of public spaces and the placement of unauthorized signs, focusing on areas like Sidi Moumen and Sidi Bernoussi, where they have removed iron boxes used by grocery stores to store gas canister, sunshades, and unauthorized structures, with some businesses occupying sidewalks.
• The regional health union coordination in Midelt organized a warning protest at the regional hospital, with over 70 health workers and several local residents participating, expressing their dissatisfaction with the “alarming decline in healthcare services” and “poor management” hindering proper care.

Cross-border stability:

• The European Parliament has dissolved the “Western Sahara” intergroup, a move seen as a significant setback for Algeria’s influence and support for separatist claims in Morocco, reflecting a shift in political alignment among member states.
• The possibility of a military border confrontation between Morocco and Algeria, driven by a growing arms race, was highlighted in a new study from the Arab Center for Research and Policy Studies, which also noted that the Maghreb has become one of the world’s most heavily armed regions, with four countries in the region accounting for 50% of Africa’s military spending in 2021.