Libya, Morocco calamities blot investor glimmer

Morocco in 2022 endured another catastrophe when record drought contracted agricultural output 15% for barely positive 1% gross domestic product (GDP) growth. These burdens were mitigated with notable strides this year during the first half in both countries, through signature moves such as an oversubscribed Eurobond issue for Morocco and central bank first phase reunification in Libya. As a “wealthy but fragile state”, diversification is in order with hydrocarbons forming 95% of exports, and 2,000 mainly loss-making state enterprises. The central bank must also divest from commercial banks providing three-quarters of system credit, align capital adequacy and loss provision measures, and better define the Islamic style approach, the Fund concluded. In the aftermath, this path invites a more visible appearance on foreign bank and fund manager radar than the sideline relegation to date complicated by delicate geopolitics.