Economic growth is expected to show a significant increase in Morocco in 2023, marking the country’s recovery from the effects of the drought which slowed down the Kingdom’s economic momentum in 2022. This is roughly what we can draw from the recent economic outlook of the African Development Bank in North Africa for the year 2023. The ADB’s projections in fact focus on a recovery in national economic activity at a time when other countries in the region are struggling to regain their pre-crisis balance. Growth of 3.3% is thus expected in 2023. It would also increase to 3.5% in 2024. Inflation should show a clear reduction, falling to 5.4% in 2023 and 3.6% in 2024. Likewise, the current account deficit should settle at 4.4% in 2023. It would also return to 4% in 2024. Regarding the budget deficit, it would be around 4.6% in 2023 before returning to 3.9% in 2024. The region’s outlook These expectations are in line with regional dynamics. Indeed, the AfDB forecasts a slight increase in growth in North Africa. This should reach 4.6% in 2023 before stabilizing at 4.4% in 2024. “This level would place North Africa among the best performing regions in Africa and above the forecast continental average of 4.0% in 2023 and 4.3% in 2024,” comments the AfDB in this regard. And to specify that “the prospects for economic recovery are clouded by the unpredictability resulting from the lingering effects of the Covid-19 pandemic and the repercussions of Russia’s invasion of Ukraine. The most visible impact on North Africa is the rise in oil and food prices, which accentuates inflationary pressures on the economies. In terms of outlook, the ADB expects a variation in the economic performance of different countries in the region. In addition to the resumption of economic activity in Morocco, the ADB indicates that the Libyan economy should record a notable recovery in 2023. Real GDP growth in Libya should thus reach 17.9%. On the other hand, real GDP growth is expected to decrease by 2.2% compared to 2022 in Egypt, by 1% in Mauritania and by 0.5% in Tunisia. Green growth, a regional emergency The AfDB placed its annual report on the economic outlook for North Africa in 2023 under the theme of mobilizing private sector financing for the climate and green growth in Africa. The latter should be, according to the ADB, made a regional emergency. These guidelines tend to promote inclusive growth in North Africa. “North African public authorities, foreign and domestic private investors, multilateral development banks and development finance institutions as well as the private sector should invest in green growth,” notes the AfDB. And to specify: “Private sector financing can notably play a crucial role through investments in clean energy infrastructure, energy efficiency, sustainable agriculture and land restoration. The private sector can also provide the expertise, technology and management skills necessary for the effective and efficient implementation of green development projects. Among the recommendations issued by the AfDB is the implementation of structural reforms that promote the development of the private sector, improve productivity and employability and create employment opportunities. The AfDB also recommends coordination of monetary and fiscal policies to address rising inflation and protect small businesses and populations, through targeted public spending. The AfDB also calls for the region to strengthen its resilience, particularly within the framework of the “energy transition – water management – food security” link. Strengthening the implementation of the African Continental Free Trade Area is also recommended. The aim is to stimulate intra-African trade and investment.
source: dhui.ma
