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Country Risk: Morocco

Flag of Morocco

Official Name: The Kingdom of Morocco

Internet Domain: .ma
International Dialing Code: +212

Table of Contents

Government Credit and Collections
Legal System Risk Assessment
People Business Climate
Economy Business Practices
Comparative Indicators


The Moroccan government is a constitutional monarchy with three branches:

Executive: King (head of state) Mohammed VI; Prime Minister (head of government) Saad-Eddine al-OTHMANI

Legislative: Bicameral Parliament

Judicial: Supreme Court. The country is divided into 16 administrative regions administered by Walis (governors) appointed by the King. Ultimate authority rests with the King, who may terminate the tenure of any minister, dissolve the Parliament, call for new elections, or rule by decree. The King is the Commander in Chief of the military and holds the title of Amir al-Mou’minin, the country’s religious leader.

Legal System

Morocco’s legal system is based on Islamic law and French and Spanish civil law systems. The Constitutional Chamber of Supreme Court is responsible for judicial review of legislative acts. Morocco has not accepted compulsory ICJ jurisdiction. The legal system is non-discriminatory legal system and accessible to foreign investors.

Map of Morocco


  • Population: 34,314,130 (July 2018 est.)
  • Population growth rate: 0.95% (July 2018 est.)
  • Languages: Arabic (official); French functions as the language of business, government, and diplomacy; English is rapidly becoming the foreign language of choice among educated youth and is offered in all public schools from the fourth year on. Several Berber dialects are also spoken.
  • Literacy: 68.5% (2015 est.): male 78.6%; female 58.8%


Macroeconomic stability, coupled with low inflation and relatively slow economic growth, has characterized the Moroccan economy since the 1990s. The government continues to pursue reform, liberalization, and modernization aimed at stimulating growth and creating jobs. Employment, however, remains overly dependent on the agriculture sector, which is extremely vulnerable to inconsistent rainfall. Poverty has increased due to the volatile nature of GDP, Morocco’s continued dependence on foreign energy, and its inability to promote the growth of small and medium size enterprises.

Currency: Dirham (MAD)

Leading Markets (2017): Spain 23.2%, France 22.6%, Italy 4.5%, US 4.2%

Leading Exports – Commodities: Clothing, fish, inorganic chemicals, transistors, crude minerals, fertilizers (including phosphates), petroleum products, fruits, vegetables

Leading Suppliers (2017): Spain 16.7%, France 12.2%, China 9.2%, US 6.9%, Germany 6%, Italy 5.9%, Turkey 4.5%.

Leading Imports – Commodities: Crude petroleum, textile fabric, telecommunications equipment, wheat, gas and electricity, transistors, plastics

Top Industries: Phosphate rock mining and processing, food processing, leather goods, textiles, construction, tourism

Agricultural Products: Barley, wheat, citrus, wine, vegetables, olives; livestock

Comparative Economic Indicators – 2018

Morocco Algeria Spain Egypt Tunisia Syria
Population (millions)* 34.3 41.6 49.3 99.4 11.5 19.4
Population growth (%)* 0.95 1.63 0.73 2.38 0.95 7.3
GDP (USD billions) 298.6 630.0 1,778.0 1,204.0 137.7 50.2
GDP per capita (USD) 8,600.0 15,200.0 38,400.0 12,700.0 11,900.0 2,900.0
Economic growth: (%) 4.1 1.4 3.0 4.2 2.0 -36.5
Inflation (%) 0.8 5.6 2.0 23.5 5.3 28.1
Unemployment rate (%) 10.2 11.7 17.2 12.2 15.5 50.0
Exports (USD billions) 21.4 34.3 313.7 23.3 13.8 1.8
Imports (USD billions) 39.6 48.5 338.6 59.7 19.0 6.2
Foreign debt (% of GDP) 65.1 27.5 98.4 103.0 70.3 94.8
Currency Dirham
Exchange rates (per USD) 9.69 120.60 0.91 16.30 2.87 436.5
Exchange rates (per EUR) 10.63 132.03 n/a 17.90 3.14 564.71

* 2017 estimate

Credit and Collections

  • Collection Experience: Fair-Good
  • Exchange Delays: 3 months
  • Preferred Credit Terms: Unconfirmed letter of credit
  • Minimum Credit Terms: Open account


Dispute Resolution


The recent establishment of a network of commercial courts has somewhat improved commercial law operations, although enforcement of decisions still seems to be a problem. Morocco is a member of the International Center for the Settlement of Investment Disputes (ICSID), and a party to the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (with reservations) and the 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States.

Risk Assessment

Coface Country Risk Rating: A4 — An already patchy payment record could be further worsened by a deteriorating political and economic environment. Nevertheless, the probability of a default is still acceptable.

Credendo Political Risk Rating: 2 ” Low risk
Credendo Commercial Risk Rating: B “ High risk

Business Climate

Morocco has been a gateway to trade with Europe, Africa, and the Middle East for more than a thousand years. The country’s geographic position and the size of its market — 31 million strong — have made it a very attractive base for setting up industries targeting the North African market. Morocco enjoys significant assets including proximity to the European market, natural resources, vast tourist potential, and political stability.

The Moroccan government actively encourages foreign investment and is taking measurable steps to improve the investment climate for foreign and domestic investors. Morocco has signed a free trade agreement with the United States, and an agreement of association with the European Union. The government has set up sixteen Regional Investment Centres (RDI) in the country with the aim of facilitating foreign investments.

Economic Freedom: According to the 2019 Index of Economic Freedom, Morocco’s economy is 60.1 percent free. This makes it the world’s 89th freest economy. Morocco is ranked 9th out of 15 countries in the Middle East/North Africa region, and its overall score is slightly higher than the regional average.

Transparency of Regulatory System: Although not perfect, Morocco’s regulatory system is becoming increasingly transparent. The government is working to ensure that its procedures are transparent, efficient and quick. Still, routine permits, especially those required by local governments, can be difficult to obtain. In response to these problems, the government has launched reforms to streamline bureaucratic procedures.

Expropriation and Compensation: The U.S. Embassy is not aware of any recent, confirmed instances of private property being expropriated for other than public purposes, or being expropriated in a manner that is discriminatory or not in accordance with established principles of international law.

Protection of Property Rights: The U.S.-Morocco Free Trade Agreement contains some of the strongest Intellectual Property protections in any free trade agreement. The Moroccan parliament recently passed amendments to its existing intellectual property legislation that bring Morocco into compliance with the FTA Intellectual Property provisions.

Conversion and Transfer Policies: The dirham is fully convertible for all current account transactions and some capital transactions. Foreign exchange is readily available through commercial banks for the repatriation of dividends and capital by foreign investors, for remittances by foreign residents, and for payments for foreign technical assistance, royalties and licenses. No prior government approval is required.

Corruption: Morocco has a broad body of laws and regulations to combat corruption. Corruption nevertheless exists and some companies have at times identified it as an obstacle to doing business in Morocco.

Political Violence: Demonstrations occur frequently in Morocco and usually center on domestic issues. Although these demonstrations have been peaceful, well organized, and well controlled by the police, some have been anti-American with isolated incidents of violence. The last instance of mass domestic political violence was over 25 years ago.

Business and Cultural Practices

Many of Morocco’s leading industrialists and businesspersons were educated in Europe. Morocco is a former French protectorate and many of its business practices are based on the French system. The main language used in business discussions is French. Both public and private procurement are in French with some exceptions.

Moroccans’ most cherished possession is their honor and dignity, which reflects not only on themselves but on all members of their extended family. To avoid a loss of honor, many Moroccans will say or do things publicly because it makes them look good or helps them avoid embarrassment or awkwardness. Therefore, in business it is extremely important to verify anything that has been agreed to in front of others.

Moroccans prefer to do business with those they know and respect, therefore expect to spend time cultivating a personal relationship before business is conducted.

Business Cards: Have one side of your card translated into French or Arabic. Present your card so the translated side faces the recipient.

Business Attire: Moroccans judge people on appearances, so dress and present yourself well. Business attire is formal and conservative. Men should wear dark colored business suits. Women should wear elegant business suits, dresses or pantsuits. Women must be careful to cover themselves appropriately. Skirts and dresses should cover the knee and sleeves should cover most of the arm.

Meetings and Negotiations: Appointments are necessary and should be made as far in advance as possible. In general, Moroccans have an open-door policy, even during meetings. This means you may experience frequent interruptions. Others may even wander into the room and start a different discussion. You may join in, but do not try to bring the topic back to the original discussion until the new person leaves.

Companies are hierarchical. The highest ranking person makes decisions, but only after obtaining a group consensus. Decisions are reached after great deliberation. Expect a fair amount of haggling. Moroccans seldom see an offer as final.

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This information is provided by ABC-Amega Inc. Providing international receivable management and debt collection services for exporters to more than 200 countries including Morocco.  For further information, contact [email protected]. This report represents a compilation of information from a wide variety of reputable sources.