King Mohammed VI of Morocco received Governor Abdellatif Jouahri of Bank Al-Maghrib at the royal palace in Tétouan earlier this week. The meeting focused on the central bank’s annual report detailing the nation’s economic, monetary, and financial performance for 2025.

Growth accelerates to 4.9% amid controlled inflation

In his address to the Monarch, Governor Jouahri highlighted Morocco’s resilient economic trajectory in 2025, reaching 4.9% GDP growth despite persistent global uncertainties and successive economic shocks. This expansion was primarily driven by substantial investment initiatives across key sectors.

Inflation remained remarkably stable throughout the year, averaging just 0.8%, demonstrating effective monetary policy management.

The central bank maintained an accommodative monetary stance, reducing its key interest rate to 2.25%. Bank Al-Maghrib continued ensuring adequate liquidity for commercial banks while launching targeted initiatives to enhance credit access for small and medium-sized enterprises.

Employment challenges persist despite growth

While economic recovery stimulated job creation, the unemployment rate remained stubbornly high at 13%. Governor Jouahri emphasized that growth alone has not yet translated into significant labor market improvements.

Fiscal discipline pays off

The budget deficit narrowed to 3.5% of GDP in 2025, supported by strong tax revenues and innovative financing mechanisms. Morocco’s external accounts remained stable, buoyed by tourism earnings, remittances from Moroccans abroad, and strong export performance in phosphates, phosphate derivatives, and aerospace components. Foreign reserves reached 443 billion Moroccan dirhams, covering over five and a half months of imports.

Addressing the perception gap and structural reforms

Governor Jouahri noted that while macroeconomic indicators reflect progress toward emerging market status, sustainable development requires more inclusive growth. He identified two critical factors contributing to the disconnect between measured economic growth and public perception:

• Slow labor market integration: Employment growth has not kept pace with rising expectations. Addressing this gap demands improved education and vocational training systems, maximizing investment returns, advancing structural reforms, and strengthening private sector participation.
• Persistent social inequalities: Despite substantial investments in social safety nets, Governor Jouahri stressed the need for better-targeted assistance to reach the most vulnerable populations. He referenced the 2025 Throne Speech emphasizing Morocco’s commitment to eliminating ‘two-speed development.’

To maintain fiscal flexibility amid high fixed expenditures and imminent pension system reforms, the central bank governor called for strict resource rationalization, regular spending reviews, and accelerated implementation of the organic finance law.

Strategic priorities for long-term resilience

Looking ahead, Bank Al-Maghrib outlined several strategic priorities:

• Strategic reserves: Building strategic reserves of essential goods and food products to enhance resilience against global supply chain disruptions.
• Energy transition: Accelerating renewable energy adoption to reduce import dependency and prepare exporters for increasingly stringent international climate standards.
• Water governance: Elevating water management and valorization to the top of public policy priorities given climate change impacts on water resources.
• Advanced regionalization: Continuing efforts to empower local governments and develop regional economic hubs, following royal directives from 2024 to reduce territorial disparities.

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