Morocco's economy is considered a relatively liberal economy governed by the law of supply and demand. Since 1993, the country has followed a policy of privatisation of certain economic sectors which used to be in the hands of the government. Morocco has become a major player in African economic affairs, and is the 5th African economy by GDP (PPP). Morocco was ranked as the first African country by the Economist Intelligence Unit's quality-of-life index, ahead of South Africa. However, in the years since that first-place ranking was given, Morocco has slipped into fourth place behind Egypt.
Government reforms and steady yearly growth in the region of 4–5% from 2000 to 2007, including 4.9% year-on-year growth in 2003–2007 helped the Moroccan economy to become much more robust compared to a few years ago. For 2012 the World Bank forecasts a rate of 4% growth for Morocco and 4.2% for following year, 2013.
The services sector accounts for just over half of GDP and industry, made up of mining, construction and manufacturing, is an additional quarter. The industries that recorded the highest growth are tourism, telecoms, information technology, and textile.
Tourism is one of the most important sectors in Moroccan economy. It is well developed with a strong tourist industry focused on the country's coast, culture, and history. Morocco attracted more than 10 million tourists in 2013. Tourism is the second largest foreign exchange earner in Morocco after the phosphate industry. The Moroccan government is heavily investing in tourism development, in 2010 the government launched its Vision 2020 which plans to make Morocco one of the top 20 tourist destinations in the world and to double the annual number of international arrivals to 20 million by 2020, with the hope that tourism will then have risen to 20% of GDP.
A large government sponsored marketing campaigns to attract tourists advertised Morocco as a cheap and exotic, yet safe, place for tourists, most of the visitors to Morocco continue to be European, with French nationals making up almost 20% of all visitors. Most Europeans visit in April and the autumn. Morocco's relatively high number of tourists has been aided by its location, Morocco is close to Europe and attracts visitors to its beaches. Because of its proximity to Spain, tourists in southern Spain's coastal areas take one- to three-day trips to Morocco.
Air services between Morocco and Algeria have been established, many Algerians have gone to Morocco to shop and visit family and friends. Morocco is relatively inexpensive because of the devaluation of the dirham and the increase of hotel prices in Spain. Morocco has an excellent road and rail infrastructure that links the major cities and tourist destinations with ports and cities with international airports. Low-cost airlines offer cheap flights to the country.
Tourism is increasingly focused on Morocco's culture, such as its ancient cities. The modern tourist industry capitalises on Morocco's ancient Roman and Islamic sites, and on its landscape and cultural history. 60% of Morocco's tourists visit for its culture and heritage. Agadir is a major coastal resort and has a third of all Moroccan bed nights. It is a base for tours to the Atlas Mountains. Other resorts in north Morocco are also very popular.
Casablanca is the major cruise port in Morocco, and has the best developed market for tourists in Morocco, Marrakech in central Morocco is a popular tourist destination, but is more popular among tourists for one- and two-day excursions that provide a taste of Morocco's history and culture. The Majorelle botanical garden in Marrakech is a popular tourist attraction. It was bought by the fashion designer Yves Saint-Laurent and Pierre Bergé in 1980. Their presence in the city helped to boost the city's profile as a tourist destination.
As of 2006, activity and adventure tourism in the Atlas and Rif Mountains are the fastest growth area in Moroccan tourism. These locations have excellent walking and trekking opportunities from late March to mid-November. The government is investing in trekking circuits. They are also developing desert tourism in competition with Tunisia.
Below is a table of the agricultural output of Morocco according to estimates of the UN Food & Agriculture Organisation Agriculture accounts for around 14% of GDP and employs 40–45% of the Moroccan working population. With a semi-arid climate and an ill-developed irrigation system, it is difficult to assure enough irrigation.
The major resources of the Moroccan economy are agriculture, phosphates, and tourism. Sales of fish and seafood are important as well. Industry and mining contribute about one-third of the annual GDP. Morocco is the world's third-largest producer of phosphorus after China and the United States, and the price fluctuations of phosphates on the international market greatly influence Morocco's economy.
Morocco suffers both from unemployment (9.6% in 2008), and a large external debt estimated at around $20 billion, or half of GDP in 2002.
Although Morocco runs a structural trade deficit, this is typically offset by substantial services earnings from tourism and large remittance inflows from the diaspora, and the country normally runs a small current-account surplus.
In 2008, about 56% of Morocco's electricity supply was provided by coal. However, as forecasts indicate that energy requirements in Morocco will rise 6% per year between 2012 and 2050, a new law passed encouraging Moroccans to look for ways to diversify the energy supply, including more renewable resources. The Moroccan government has launched a project to build a solar thermal energy power plant and is also looking into the use of natural gas as a potential source of revenue for Morocco's government.
Morocco has embarked upon the construction of large solar energy farms to lessen dependence on fossil fuels, and to eventually export electricity to Europe.
Since the 7th century, Cannabis has been cultivated in the Rif Region. In 2004, according to the UN World Drugs Report, cultivation and transformation of Cannabis represents 0.57% of the national GDP of Morocco in 2002. According to a French Ministry of the Interior 2006 report, 80% of the cannabis resin (hashish) consumed in Europe comes from the Rif region in Morocco, which is mostly mountainous terrain in the north of Morocco, also hosting plains that are very fertile and expanding from Melwiyya River and Ras Kebdana in the East to Tangier and Cape Spartel in the West. Also, the region extends from the Mediterranean in the south, home of the Wergha River, to the north. In addition to that, Morocco is a transit point for cocaine from South America destined for Western Europe.
There are around 56,986 km (35,409 mi) of roads (national, regional and provincial) in Morocco. In addition to 1,416 km (880 mi) of highways.
The Tangier-Casablanca high-speed rail link marks the first stage of the ONCF's high-speed rail master plan, pursuant to which over 1,500 km (930 mi) of new railway lines will be built by 2035. The high speed train – TGV – will have a capacity of 500 passengers and will carry 8 million passengers per year. The work on the High Speed Rail project was started in September 2011. Construction of infrastructure and delivery of railway equipment will end in 2014 and the HSR will be operational by December 2015.
Water supply and sanitation
Water supply and sanitation in Morocco is provided by a wide array of utilities. They range from private companies in the largest city, Casablanca, the capital, Rabat, and two other cities, to public municipal utilities in 13 other cities, as well as a national electricity and water company (ONEE). The latter is in charge of bulk water supply to the aforementioned utilities, water distribution in about 500 small towns, as well as sewerage and wastewater treatment in 60 of these towns.
There have been substantial improvements in access to water supply, and to a lesser extent to sanitation, over the past fifteen years. Remaining challenges include a low level of wastewater treatment (only 13% of collected wastewater is being treated), lack of house connections in the poorest urban neighbourhoods, and limited sustainability of rural systems (20 percent of rural systems are estimated not to function). In 2005 a National Sanitation Program was approved that aims at treating 60% of collected wastewater and connecting 80% of urban households to sewers by 2020. The issue of lack of water connections for some of the urban poor is being addressed as part of the National Human Development Initiative, under which residents of informal settlements have received land titles and have fees waived that are normally paid to utilities in order to connect to the water and sewer network.
Science and technology
The Moroccan government has been implementing reforms to improve the quality of education and make research more responsive to socio-economic needs. In May 2009, Morocco's prime minister, Abbas El Fassi, announced greater support for science during a meeting at the National Centre for Scientific and Technical Research. The aim was to give universities greater financial autonomy from the government to make them more responsive to research needs and better able to forge links with the private sector, in the hope that this would nurture a culture of entrepreneurship in academia. He announced that investment in science and technology would rise from US$620,000 in 2008 to US$8.5 million (69 million Moroccan dirhams) in 2009, in order to finance the refurbishment and construction of laboratories, training courses for researchers in financial management, a scholarship programme for postgraduate research and incentive measures for companies prepared to finance research, such as giving them access to scientific results that they could then use to develop new products.
The Moroccan Innovation Strategy was launched at the country’s first National Innovation Summit in June 2009 by the Ministry of Industry, Commerce, Investment and the Digital Economy. The Moroccan Innovation Strategy fixed the target of producing 1,000 Moroccan patents and creating 200 innovative start-ups by 2014. In 2012, Moroccan inventors applied for 197 patents, up from 152 two years earlier. In 2011, the Ministry of Industry, Commerce and New Technologies created a Moroccan Club of Innovation, in partnership with the Moroccan Office of Industrial and Commercial Property. The idea is to create a network of players in innovation, including researchers, entrepreneurs, students and academics, to help them develop innovative projects.
The Ministry of Higher Education and Scientific Research is supporting research in advanced technologies and the development of innovative cities in Fez, Rabat and Marrakesh. The government is encouraging public institutions to engage with citizens in innovation. One example is the Moroccan Phosphate Office (Office chérifien des phosphates), which has invested in a project to develop a smart city, King Mohammed VI Green City, around Mohammed VI University located between Casablanca and Marrakesh, at a cost of DH 4.7 billion (circa US$479 million).
As of 2015, Morocco had three technoparks. Since the first technopark was established in Rabat in 2005, a second has been set up in Casablanca, followed, in 2015, by a third in Tangers. The technoparks host start-ups and small and medium-sized enterprises specializing in information and communication technologies (ICTs), 'green' technologies (namely, environmentally friendly technologies) and cultural industries.
In 2012, the Hassan II Academy of Science and Technology identified a number of sectors where Morocco has a comparative advantage and skilled human capital, including mining, fisheries, food chemistry and new technologies. It also identified a number of strategic sectors, such as energy, with an emphasis on renewable energies such as photovoltaic, thermal solar energy, wind and biomass; as well as the water, nutrition and health sectors, the environment and geosciences.
On 20 May 2015, less than a year after its inception, the Higher Council for Education, Training and Scientific Research presented a report to the king offering a Vision for Education in Morocco 2015–2030. The report advocated making education egalitarian and, thus, accessible to the greatest number. Since improving the quality of education goes hand in hand with promoting research and development, the report also recommended developing an integrated national innovation system which would be financed by gradually increasing the share of GDP devoted to research and development (R&D) from 0.73% of GDP in 2010 ‘to 1% in the short term, 1.5% by 2025 and 2% by 2030’.