His Majesty King Mohammed VI received Abdellatif Jouahri, Governor of Bank Al-Maghrib, at the Royal Palace in Tetouan earlier this week to review the central bank’s annual economic report for 2025.

During the meeting, Governor Jouahri presented a comprehensive overview of Morocco’s economic, monetary, and financial landscape, highlighting significant progress despite a challenging international environment.

Robust growth and controlled inflation

Morocco’s economy expanded by 4.9% in 2025, driven primarily by substantial investment efforts across key sectors. This growth occurred against a backdrop of persistent global challenges, including successive economic shocks and heightened uncertainty.

The central bank maintained an accommodative monetary policy, reducing its benchmark interest rate to 2.25%. Bank Al-Maghrib ensured ample liquidity for commercial banks while intensifying initiatives to improve credit access for small and medium-sized enterprises.

Inflation remained under tight control throughout the year, averaging just 0.8%, demonstrating effective monetary management in a volatile global market.

Employment challenges and fiscal consolidation

While economic growth spurred job creation, the unemployment rate remained stubbornly high at 13%. Governor Jouahri acknowledged that employment growth had not yet matched expectations, underscoring the need for structural reforms in education, vocational training, and private sector participation.

The fiscal deficit continued its downward trajectory, narrowing to 3.5% of GDP. This improvement stemmed from robust tax revenues and innovative financing mechanisms, contributing to overall economic stability.

Morocco’s external accounts demonstrated remarkable resilience, supported by strong tourism revenues, remittances from Moroccans abroad, and solid export performance in phosphates, phosphate derivatives, and aerospace sectors. The country’s official reserves strengthened to 443 billion Moroccan dirhams, covering more than five months of imports.

Addressing perception gaps and social inequalities

Governor Jouahri emphasized that while macroeconomic indicators pointed toward emerging market status, sustainable progress required more equitable distribution of growth benefits. He highlighted a growing global phenomenon in Morocco: a widening gap between measured economic growth and public perception of economic conditions.

This perception gap stems from two primary factors. First, slow labor market integration: employment growth has not yet met expectations, necessitating improvements in education systems, vocational training, and private sector engagement. Second, persistent social inequalities, as noted in His Majesty’s 2025 Throne Speech warning against a “two-speed Morocco.”

Despite substantial investments in social safety nets, Governor Jouahri stressed the need for better targeting of welfare programs to reach the most vulnerable populations. He also called for strict fiscal discipline to manage high fixed expenditures and imminent pension system reforms, advocating for regular spending reviews and accelerated implementation of the organic finance law.

Strategic priorities for long-term resilience

Looking ahead, Bank Al-Maghrib identified several strategic priorities to enhance Morocco’s long-term economic resilience:

• Strategic reserves: Building strategic reserves of essential goods, shifting from reactive to preventive approaches in response to recurring global supply chain disruptions.
• Energy transition: Accelerating the shift to renewable energy to reduce external dependencies and prepare exporters for increasingly stringent climate standards imposed by major trading partners.
• Water governance: Prioritizing water management and valorization due to severe climate impacts on water resources.
• Advanced regionalization: Continuing efforts to promote regional economic hubs that leverage local talent, following the 2024 royal directives to reduce territorial disparities.

Governor Jouahri concluded by emphasizing that consolidating Morocco’s economic achievements required sustained coordination between public and private actors under the leadership of the Monarchy. Following the presentation, he officially submitted the 2025 annual report to His Majesty King Mohammed VI, along with a commemorative gold coin minted by Bank Al-Maghrib to mark the first anniversary of the “Aid Al Wahda” initiative.