Morocco's Economic Growth Expected to Slow Down in Q1 2019

People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
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Morocco's Economic Growth Expected to Slow Down in Q1 2019

People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)

Morocco’s economic growth is expected to record a 2.5 % during Q1 of 2019 compared to 3.3 % in Q1 2018, Morocco's Higher Planning Commission said on Wednesday.

Growth in the Q4 of 2018 was affected by the slowdown in added value, excluding agricultural activity, by 2.6 percent, compared with 3.4 percent during the same period of 2017.

The Commission said on its website that the agricultural sector grew 3.4 percent in Q4 of last year, compared to 4.1 percent during the first three quarters. This slowdown is partly due to the decline in livestock production.

Manufacturing growth in the last quarter of 2018, according to published estimates, also slowed to 2.8 percent from 3.2 percent in the same period a year earlier, as food industries slowed and demand for building materials fell.

However, chemical industry maintained its "dynamism" and grew 6.1 percent, and the added value of the textile and leather sectors increased 5.8 percent with the increase for the external demand for these products.

Mechanical and electronic industries grew 3.6 percent supported by demand from the automotive industry, stated the report.

Morocco's exports in the fourth quarter of 2018 increased 5.1 percent, thanks to higher sales in the aviation and automobile sectors, which contributed 80 percent to the growth rate of exports.

Food, clothing and electronics sectors contributed to a 0.9, 0.6 and 0.5 percent growth, respectively, as external demand for these products increased.

Imports recorded a 5.8 percent rate higher than exports, as the country was affected by the rise in global fuel prices, which contributed 2.2 points to import growth. In contrast, imports of foodstuffs, precisely wheat and sugar, declined during that period.

Industrial investment slowed in Q4, which was reflected on imports of processing materials that only increased 2.1 percent, compared to an 11 percent increase in the previous quarter.

Investment in construction was modest, with weak demand for housing, especially medium and high, stated the report.

For the first quarter of 2019, the Commission said that the expected slowdown will come from a decline in agricultural added value, estimated at 0.7 percent, although livestock production will see some improvement compared to the end of 2018.

“Overall, the non-agriculture added value is expected to record a 2.9 percent increase, according to the annual change.”



Saudi Arabia Revises Q1 Economic Growth Estimate Up to 3.4%

A general view of Riyadh, Saudi Arabia. (AFP)
A general view of Riyadh, Saudi Arabia. (AFP)
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Saudi Arabia Revises Q1 Economic Growth Estimate Up to 3.4%

A general view of Riyadh, Saudi Arabia. (AFP)
A general view of Riyadh, Saudi Arabia. (AFP)

Saudi Arabia’s General Authority for Statistics has revised its annual economic growth figures for the Kingdom for the first quarter of 2025 to 3.4%, up from a preliminary estimate of 2.7% released in May, underscoring the resilience of non-oil sectors in driving economic momentum.

Seasonally adjusted data showed real gross domestic product (GDP) grew 1.1% in the first quarter compared to the final three months of 2024, according to the updated figures.

The figures showed non-oil activities as the true driver behind Saudi Arabia’s economic expansion.

Non-oil sectors surged 4.9% year-on-year, up from 4.2% in the May preliminary reading, and grew 1.0% quarter-on-quarter, contributing 2.8 percentage points to overall real GDP growth.

This robust growth reflects the impact of massive government investments in infrastructure projects and development initiatives, alongside efforts to boost the private sector.

In contrast, oil sector activities saw a slight decline of 0.5% year-on-year and 1.2% quarter-on-quarter, primarily due to the Kingdom’s voluntary production cuts.

Despite this contraction, the negative impact on overall growth remained limited to just 0.1 percentage points, underscoring the economy’s ability to offset oil sector weakness through other areas.

Government activities also recorded solid growth, rising 3.2% year-on-year and 5.5% compared to the previous quarter.

Most non-oil economic activities recorded robust positive growth rates in the first quarter of 2025.

Wholesale and retail trade, restaurants, and hotels posted the highest growth at 8.4% year-on-year, reflecting a booming tourism and entertainment sector alongside rising private consumer spending.

Transport, storage, and communications grew by 6.0% year-on-year, highlighting advancements in the Kingdom’s logistics and digital infrastructure.

Financial services, insurance, and business services expanded 5.5% year-on-year, indicating maturation of the financial and service sectors.

The data underscore the pivotal role of government investments and consumer spending in sustaining this growth. Gross fixed capital formation rose 8.5% annually, signaling continued funding for major projects and urban development.

Meanwhile, government final consumption expenditure increased by 5.2%, with private final consumption up 4.5% year-on-year.

Non-oil exports, including re-exports, surged 13.4% year-on-year in Q1 2025, while oil exports declined 8.4% over the same period, according to official figures released in May.

These revised estimates come amid efforts by the General Authority for Statistics to align closely with international standards and enhance data quality.

The authority undertook a comprehensive update of GDP estimates, applying the global moving-average methodology and collecting detailed 2023 data through expanded statistical surveys, ensuring accuracy and reliability.

This strong non-oil-driven growth highlights Saudi Arabia’s economic resilience and adaptability in a changing global landscape, reinforcing its steady path toward the ambitious goals of Vision 2030.

In its latest World Economic Outlook report, the International Monetary Fund (IMF) forecast Saudi Arabia’s GDP growth at 3.0% for 2025, a downward revision from its January estimate of 3.3%. The IMF also cut its 2026 growth forecast by 0.4 percentage points to 3.7%.

Jihad Azour, IMF Director for the Middle East and Central Asia, told Asharq Al-Awsat last month that Saudi Arabia’s economic resilience enables it to weather fluctuations in global oil prices.

He noted the Kingdom’s substantial financial reserves provide a strong buffer against external shocks. These reserves, combined with ongoing structural reforms under Vision 2030, have significantly strengthened Saudi Arabia’s capacity to adapt.

Azour added that reforms have not only bolstered economic resilience but also effectively diversified income sources and increased the contribution of non-oil sectors to GDP.

This shift toward developing promising sectors reduces reliance on oil revenues and fosters sustainable new economic opportunities.