Casablanca Fair Signals Morocco Manufacturing Upgrade

Casablanca’s sustainable agri-packaging fair (22-24 October 2025) signals a recalibration of Morocco’s industrial strategy under severe macro constraints. In 2024 the economy expanded around 3.8 % year-on-year, driven by a 4.5 % rebound in non-agricultural sectors that offset a contraction of approximately 4.8 % in the agricultural sector.

During the same year, manufacturing’s share of GDP fell to 14.29 % from 14.49 % in 2023, compared with a historical average of 16.84 % and a peak near 20.2 % in 1984. The new fair frames the push to shift Morocco’s export mix from raw and semi-processed goods toward higher-value packaging and materials, particularly leveraging domestic biomass such as rosemary and agricultural residues.

The policy drive rests on three interconnected mechanisms. First, substituting imported petrochemical-derived plastics—which reached US$2.99 billion in 2023 and comprised about 4.23 % of total imports—reduces external vulnerability and input-cost risk. Second, redirecting agronomy into industrial feedstocks links farm output to manufacturing, creating value-added upgrade and employment multipliers. Third, leveraging regulatory arbitrage—specifically the EU’s Single-Use Plastics Directive—mates export orientation with green compliance, enhancing competitiveness of Moroccan SMEs. The combination strengthens domestic supply chains, improves trade resilience and aligns with the currency regime tied to a circa 60/40 euro/dollar basket, helping to mitigate imported inflation from petrochemical inputs.

Macro-economic effects are measurable. A reduction of even 10 % in plastics imports (≈US$300 million annually) narrows the trade deficit and lessens FX demand. With Morocco’s goods trade deficit at roughly US$28.18 billion in 2023, this equates to a reduction of 0.2–0.3 % of GDP. Lower import-led inflation supports the central bank’s policy position; the policy rate remains at 2.25 %, while 10-year local bonds trade around 3.0 %, reflecting credible disinflation and improved external balance. Industrial production grew 5.0 % year-on-year in Q4 2024, evidence of recovery in manufacturing. That output response tightens the link between policy stimulus and growth.

Capital-market reactions follow logically. The MASI index stands to benefit as banks like ATW (Attijariwafa) and BCP (Banque Centrale Populaire) scale green credit programmes. Logistics and packaging-converter firms will secure valuation uplifts if they secure EU-certified contracts and export channels. For commodity benchmarks, the substitution away from petrochemical-based packaging weakens the pass-through from crude-oil indices (CL=F) into consumer-packaging cost inflation, reducing sensitivity in local inflation and input benchmarks. Thus, the shift morphs industrial policy into market signal.

Comparatively, regional peers such as Egypt and Tunisia still rely on plastic-based packaging chains with recycling rates under 20 %. Morocco’s 14.29 % manufacturing-GDP share below global averages (12.37 % in 2024) highlights both the challenge and room for expansion. The agricultural sector’s retreat deepened after droughts; policy now targets structural reallocation into manufacturing and services. Sustaining this transformation requires coherent financing: blended industrial funds, SME credit expansion, and innovation clusters must scale.

Forward-looking measurable indicators are: manufacturing’s share of GDP rising above 16 % by end-2027, plastics-import bill falling at least 5 % below the 2024–2025 baseline, the trade deficit narrowing by 100–150 bps of GDP compared with 2024, and the 10-year bond yield remaining at or below 3.0 % by end-2026. Execution risk includes further drought reducing biomass feedstock, global demand softness in EU markets, and credit rationing constraining SME uptake. Institutional credibility will hinge on enforcing standards, transparent procurement and private-sector uptake.