Morocco economy: Morocco leads North Africa in terms of FDI inflows
According to the latest World Investment Report published by the UN, Morocco was the top recipient of foreign direct investment (FDI) in North Africa in 2012. It is the first time that the kingdom ranked number one in the region, even surpassing Egypt – historically the main recipient of FDI in North Africa and the largest Arab economy outside the Gulf countries. Morocco’s industrial sector attracted the majority of FDI inflows, according to local sources.
After a significant decline in 2008 10 owing to the downturn in the global economy, flows of FDI into Morocco picked up to US$2.57bn in 2011 and strengthened further, to US$2.84bn, in 2012. The data, which were published in the 2013 World Investment Report produced by the UN Conference on Trade and Development (UNCTAD), reveal that Morocco and Sudan were the only two North African countries to have regained their pre crisis levels. According to UNCTAD, FDI accounted for 9.2% of Morocco’s gross fixed capital formation in 2012, up from 8.2% in the previous year.
Reaping the benefits of a stable political and economic backdrop
The rising trajectory in FDI partly reflects the relatively stable political and economic conditions in Morocco, especially when compared with Egypt, Tunisia and Libya – countries that are still reeling, to differing degrees, from the aftermath of the Arab Spring. However, a number of other factors have also contributed to Morocco’s recent success in attracting FDI, including the kingdom’s proactive policy towards foreign investors, its national privatisation programme and the availability of skilled workers with wages much lower than in developed countries.
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