Casablanca – Morocco will need to mobilize approximately $14.9 billion annually through 2030 to finance the structural transformation of its economy, placing greater emphasis on domestic resource mobilization, capital market development and private-sector participation. The estimate, presented in the African Development Bank’s (AfDB) 2026 Country Report on Morocco, highlights the scale of the country’s investment requirements and the need to diversify financing mechanisms beyond public budgets and conventional bank lending.

Equivalent to approximately 7.6% of gross domestic product (GDP), these annual requirements reflect the resources needed to support infrastructure development, energy investment and improvements in the country’s productive capacity. The report identifies infrastructure as the largest financing priority, accounting for $10.35 billion annually, while energy requirements are estimated at $2.30 billion.

The assessment comes as Morocco continues to expand public investment in transport, water infrastructure, electricity generation, industrial development and social services. However, the AfDB argues that maintaining investment at the required level will depend increasingly on the country’s ability to mobilize private capital, redirect domestic savings towards productive activities and improve the efficiency of existing financial resources.

The challenge is therefore twofold: securing sufficient financing and ensuring that the resources mobilized generate sustainable economic returns without creating additional pressure on public finances.

The report also examines Morocco’s macroeconomic performance in 2025, when economic growth accelerated to 4.9%, compared with 4.4% in 2024. The improvement was supported by stronger investment, the expansion of non-agricultural activities and a recovery in agricultural production. The budget deficit declined to 3.5% of GDP from 3.8% a year earlier, while inflation eased to 0.8%.

However, the current account deficit widened to 2.4% of GDP in 2025, compared with 1.2% in 2024, reflecting stronger import demand alongside more moderate export growth. The AfDB also identifies geopolitical tensions, disruptions to international trade and climate-related uncertainties as potential risks to the country’s economic outlook.

These external factors reinforce the importance of building a more diversified financing structure capable of supporting investment even when international financial conditions become less favorable.

Infrastructure and energy account for most financing requirements

Infrastructure represents the largest component of Morocco’s estimated financing needs through 2030. The annual requirement of $10.35 billion reflects the country’s extensive investment programme covering roads, railways, ports, logistics facilities, water systems and other essential networks.

Transport infrastructure is particularly important as Morocco seeks to improve connections between economic regions, industrial zones and international markets. Railway expansion, high-speed rail development, port capacity and road networks are expected to support trade, tourism, industrial production and regional economic integration.

Water infrastructure is another major investment priority. Recurrent droughts, declining water availability and increasing demand from households, agriculture and businesses have accelerated the need for dams, desalination facilities, wastewater treatment and water transfer projects.

The energy sector requires approximately $2.30 billion in annual financing. Morocco’s energy transition, including renewable electricity generation, grid modernization, storage capacity and the development of green hydrogen and other low-carbon technologies, will require substantial long-term capital.

The country is also seeking to reduce its exposure to imported fossil fuels and strengthen the competitiveness of its industrial activities through more diversified energy supplies.

Looking beyond 2030, the AfDB estimates that Morocco’s annual structural financing requirements could decline to $2.6 billion by 2063. Road infrastructure would represent approximately 69.3% of these requirements, followed by energy at 15.4%, education at 9.8% and productivity-related investment at 5.5%.

Although the long-term projections reflect a different investment horizon, they underline the importance of maintaining infrastructure development while gradually improving the efficiency and productivity of the country’s capital stock.

Public investment needs stronger private-sector participation

Morocco has maintained an investment rate exceeding 30% of GDP over the past decade, reflecting the importance attached to infrastructure and economic development.

Nevertheless, the AfDB considers that increasing investment volumes alone will not be sufficient. Improving project selection, implementation, management and economic returns will be essential to ensure that public resources generate lasting benefits.

Public-private partnerships (PPPs) are among the main instruments proposed to expand financing capacity. Morocco has progressively developed its legal and institutional framework for these arrangements, particularly in water infrastructure, desalination and irrigation.

The AfDB recommends extending PPPs to sectors where investment requirements remain substantial, including healthcare, education, transport, logistics, waste management and industrial decarbonization.

This approach could allow private companies and institutional investors to participate more actively in financing and operating infrastructure projects, while the state retains its role in strategic planning, regulation and public-service provision.

However, the development of PPPs also requires effective management of financial commitments and contingent liabilities. Government guarantees and long-term contractual obligations can create additional budgetary exposure if projects fail to generate the expected revenues or operating performance.

The bank therefore stresses the importance of transparent project evaluation, appropriate risk allocation and stronger monitoring of public-sector commitments.

The scale of Morocco’s investment ambitions makes this issue particularly relevant. The 2027 Finance Bill includes 151 new investment operations distributed across the country’s 12 regions, with a combined estimated cost of approximately $2.77 billion. These projects cover dams, roads, healthcare facilities, university establishments and sports infrastructure. Around $534 million in payment appropriations is scheduled for 2027.

These figures concern projects included in the state’s general budget and exclude investments by public establishments and state-owned companies, as well as other components of public investment.

Tax reform remains a major source of domestic financing

Strengthening domestic revenue collection is another central recommendation of the AfDB report. Morocco’s tax revenues increased by 59.4% between 2021 and 2025, supported by economic recovery and reforms to the tax system. However, the country’s tax revenue elasticity relative to GDP remains at 0.98, below the African average of 1.05.

This means that tax revenues have not increased as rapidly as economic output, suggesting that additional resources could be mobilized through a broader tax base and more effective collection mechanisms.

The AfDB identifies tax expenditures, estimated at approximately 2% of GDP, as an area requiring attention. Rationalizing exemptions and preferential arrangements could improve the contribution of economic activity to public finances while creating a more consistent tax framework.

Other recommendations include expanding the number of taxpayers, strengthening inspection mechanisms, combating fraud and evasion, introducing electronic invoicing and increasing the use of digital payments.

The informal economy represents another major challenge. According to estimates cited in the report, informal activities accounted for 33.5% of Morocco’s GDP between 2015 and 2020.

Bringing more businesses into the formal economy could increase tax revenues, improve social protection and facilitate access to bank financing. However, the AfDB recommends an approach based on simplified administrative procedures, appropriate tax incentives, access to credit and improved social protection rather than relying exclusively on enforcement measures.

Simplifying the obligations of very small businesses could also encourage more entrepreneurs to register their activities and gradually integrate into the formal economy.

Capital markets need to become a larger source of business financing

The development of Morocco’s financial markets is another important element of the proposed financing strategy. The country’s financial system had total assets equivalent to 223% of GDP in 2025, making it relatively developed by African standards. However, banks accounted for 61% of total financial assets, illustrating the continued concentration of financing within the banking sector.

The Casablanca Stock Exchange provides an alternative source of capital, but its contribution could expand further. Its market capitalization reached 61% of GDP in 2025, compared with an average of 47.5% between 2020 and 2024. The exchange had 80 listed companies at the end of 2025.

Market capitalization remains concentrated in banking, construction and public works, and telecommunications. The AfDB therefore recommends attracting a wider range of companies to the stock market, particularly small and medium-sized enterprises.

Developing an alternative market with more flexible listing requirements could help smaller businesses obtain financing through equity and debt instruments rather than relying exclusively on bank loans.

The institution also highlights infrastructure bonds as a potential mechanism for mobilizing long-term savings without directly increasing sovereign debt. Such instruments could attract pension funds, insurance companies and other institutional investors seeking stable investment opportunities.

Green bonds, venture capital and crowdfunding are additional financing channels that could broaden the range of available resources.

Participatory finance also offers opportunities for diversification, although it currently represents just 2.1% of banking assets. Expanding its products and financing structures could help reach businesses and customers whose needs are not fully addressed by conventional banking services.

Financial inclusion and fintech development

Improving access to financial services is another important part of the AfDB’s recommendations.

The proportion of Morocco’s population holding bank accounts increased from 53% in 2020 to 58% in 2024. Nevertheless, the difference between men and women remains substantial, with account ownership reaching 70% among men and 46% among women.

The bank recommends strengthening financial products and guarantee mechanisms for micro, small and medium-sized enterprises, startups, young entrepreneurs and women.

Tamwilcom’s risk-sharing mechanisms are identified as an important instrument for improving access to credit, particularly for businesses that lack sufficient collateral or have limited credit histories.

The expansion of fintech services could also help reduce transaction costs and make financial services more accessible. Morocco has made progress through the Morocco Fintech Center and the introduction of a regulatory framework for crowdfunding.

However, startups continue to face difficulties obtaining financing during their early development stages, while cash remains widely used in commercial transactions. Differences in access to digital services between urban and rural areas also remain an obstacle.

The AfDB calls for a stronger supervised fintech ecosystem, wider adoption of accessible digital payment systems and improved cybersecurity across financial market infrastructure.

It also recommends strengthening the governance and resilience of the financial system, including better management of government guarantees and continued reforms of public establishments and state-owned companies.

Diaspora savings offer additional investment opportunities

Moroccans living abroad represent another potential source of long-term financing. Their remittances reached $13.4 billion in 2025, increasing by 2.6% compared with the previous year. These transfers already provide significant support to household consumption, savings and the balance of payments.

However, the AfDB believes that a greater share of diaspora resources could be directed towards productive investment. The institution recommends reducing transfer costs, simplifying administrative procedures and developing investment opportunities that correspond to the professional expertise and financial interests of Moroccans living abroad.

The MDM Invest programme is among the mechanisms intended to encourage this participation. Its minimum equity contribution has been reduced to 20%, while its scope has been extended to sectors such as energy, logistics and the green economy.

MDM Tamwil provides another financing option through a co-financing arrangement involving the state and commercial banks, with a preferential interest rate of 2%.

These mechanisms could encourage diaspora members to participate more directly in business development, infrastructure projects and productive activities rather than limiting their economic contribution to household transfers.

Green finance and natural resources become increasingly important

The AfDB also recommends making greater use of Morocco’s natural capital to diversify financing sources and support the transition towards a more sustainable economy.

Developing the carbon market, issuing green bonds and establishing environmental accounting mechanisms could help mobilize resources for climate-related investment.

The development of a national green taxonomy is particularly relevant in this context. By establishing clearer criteria for identifying environmentally sustainable activities, such a framework could improve transparency and facilitate access to international sustainable finance markets.

Morocco’s water challenges, renewable energy programme and industrial decarbonization objectives provide several areas where these financing instruments could be applied.

Improving the business environment will also be important for attracting foreign direct investment. Administrative simplification and greater efficiency in taxation, labour market regulation and corporate insolvency procedures could help reduce operating costs and strengthen investor confidence.

Casablanca Finance City and the expansion of African financial integration

Beyond domestic reforms, the AfDB sees regional financial integration as an additional source of capital for Morocco and other African economies.

The institution recommends greater convergence between regulatory frameworks, harmonization of prudential standards and stronger cross-border banking supervision.

It also proposes developing regional infrastructure bond funds capable of pooling financial resources for projects extending across national borders.

Improved cross-border payment systems and coordinated financial supervision could facilitate transactions between African markets and increase the movement of capital within the continent.

For Morocco, these developments could strengthen Casablanca Finance City’s role as a financial platform connecting African economies with international investors.

The regional presence of Moroccan banking groups provides an existing foundation for expanding financial cooperation, supporting investment and facilitating financing between African markets.

The development of a broader pan-African financial network could also improve the continent’s ability to mobilize its own savings and finance infrastructure projects over longer periods.

A financing model that requires gradual structural reform

The AfDB’s assessment indicates that Morocco’s financing challenge extends beyond the need to secure additional money for investment. It also concerns the structure of the financial system, the efficiency of public spending and the ability of domestic institutions to direct capital towards productive activities.

In the short term, priorities include strengthening financial stability, improving tax collection, controlling government guarantees and expanding digital financial services.

Over the medium term, the development of capital markets, infrastructure bonds, green finance and institutional savings could provide additional resources for investment. Improving corporate governance and expanding the role of private investors will also be important.

In the longer term, the formalization of economic activities, pension system reform and deeper African financial integration could help establish a broader and more diversified financing base.

For Morocco, mobilizing $14.9 billion annually through 2030 will therefore depend on the combined contribution of public finances, commercial banks, capital markets, institutional investors, foreign capital and domestic savings.

The challenge will be to coordinate these different financing channels while maintaining fiscal sustainability and ensuring that investment produces measurable economic and social returns. The AfDB’s recommendations place financial reform and resource mobilization at the centre of this process, as Morocco seeks to finance its infrastructure needs, strengthen productive capacity and maintain economic growth in an increasingly uncertain international environment.