Foreign direct investment (FDI) in Morocco

FDI in Figures

According to UNCTAD's World Investment Report 2024, FDI flows to Morocco stood at USD 1 billion in 2023, compared to the 2.2 billion recorded one year earlier. At the end of the same period, the total stock of inward FDI stood at USD 69.3 billion. By sector, in terms of net flows, the real estate sector ranked first in 2023 (+MAD 5.9 billion, accounting for 53% of total net FDI flows in Morocco), followed by the transportation and storage sector (+MAD 2 billion, with an 18.3% share), and then the financial and insurance activities sector (+MAD 1.5 billion, with a 13.4% share). Together, these three sectors accounted for 84.7% of total net FDI flows in 2023. By country, France was the top investor in Morocco in 2023, with a net flow of +MAD 6.8 billion, making up 61.4% of the total net FDI. The net flow from France in 2022 was +MAD 3.8 billion, marking a 79.5% increase. The net FDI from the United Arab Emirates reached +MAD 2.3 billion in 2023, compared to +MAD 2.2 billion in 2022, followed by the United Kingdom (+MAD 1.8 billion, down from +MAD 2.6 billion), and Spain and Germany with +MAD 1.5 billion each. In terms of stock, the main investing countries are France (30.8%), the United Arab Emirates (17.9%), Spain (8.5%), Switzerland (4.9%), the United States (6.3%), the United Kingdom (3.9%), and Saudi Arabia (3.4%); whereas the sectors receiving the most FDI are industry (24.9%), real estate (19.9%), tourism (9.6%), communication (9.4%), energy and mining (6.7%), and commerce (4.9% - data Foreign Exchange Office). According to the latest figures from the Foreign Exchange Office, in 2024, FDI revenues increased by 24.7%, reaching MAD 43.195 billion compared to MAD 34.629 billion in 2023. Additionally, net FDI flows surged by 55.4%, rising to MAD 17.237 billion from MAD 11.090 billion in 2023.

After the positive results of the Industrial Acceleration Plan 2014-2020, a vast project of economic modernisation to attract more FDI, the government launched a second phase for 2021-2025 focused mainly on the consolidation of the achievements made within the framework of the first phase of the plan (which, among other results, created 54 industrial systems in partnership with 32 professional associations and universities in various sectors) and their generalization to all regions, by integrating small and medium enterprises and by placing industry at the heart of technological transformations. Among the reasons to invest in Morocco, are the relatively low cost of labour, its strategic location between Europe and sub-Saharan Africa, good infrastructures, and the stability of the country’s currency and political framework. On the other hand, Morocco still has significant social and regional disparities, weak productivity, low competitiveness and an economy heavily reliant on the price of hydrocarbons and the agricultural sector. Both foreign and domestic private entities can establish and own businesses in Morocco, subject to sector-specific restrictions. Foreign investment in air and maritime transport companies and fisheries is capped at 49%. Foreigners cannot own agricultural land but can lease it for up to 99 years. Phosphate extraction is a state monopoly through the 95% state-owned Office Chérifien des Phosphates (OCP). The Central Bank (Bank Al-Maghrib) has discretion in authorizing domestic and foreign-owned banks, and the state can limit foreign majority stakes in large national banks, though it is unclear if this has been applied. In the oil and gas sector, the National Agency for Hydrocarbons and Mines (ONHYM) holds a mandatory 25% share in exploration and development permits. Morocco ranks 66th among 133 economies on the Global Innovation Index 2024, 101st out of 184 on the latest Index of Economic Freedom, and 99th out of 180 on the Corruption Perception Index 2024.

What to consider if you invest in Morocco

Strong Points

Morocco's strengths for FDI are:

• A legal framework and assistance measures very favourable to investors
• Relatively low labour cost
• A strategic location, between Europe and sub-Saharan Africa 
• Robust infrastructure
• A young and relatively well-trained population
• Political stability encouraged by the popularity of the King, Mohammed VI

Weak Points

The main obstacles to the development of FDI in Morocco are:

• A relatively small internal market
• A country still highly dependent on agriculture and therefore vulnerable to natural disasters and the price of hydrocarbons
• Administrative burdens slowing down, among other things, the start of business activities
• Significant social disparities by region (rural vs. urban) and a high poverty rate
• High unemployment rate and low productivity
• Weak intellectual property rights protection
• A lack of transparency in public procurement

Government Measures to Motivate or Restrict FDI

The Moroccan government actively encourages foreign investments. The "Investment Charter" of 1995 is the main legal source for FDIs. This charter mainly provides company exemptions for VAT and for corporate tax for 5 years under certain conditions.
In the industrial sector, the Industrial Acceleration Plan 2014-2020 aimed at establishing “ecosystems” that integrate value chains and supplier relationships between large companies and SMEs; and the government announced a new Acceleration Plan for the period 2021-2025.
Morocco has implemented reforms to reduce company registration fees, eliminate minimum capital requirements for limited liability companies and facilitate business registration. Companies in the “Industrial Acceleration Zones” enjoy a 15% corporate tax rate following an initial five years of exemption, whereas companies in the Casablanca Finance City (CFC) are tax exempt for the first five years, then are subject to tax at a 15% rate both on their local and export activities.
The Moroccan government can sign specific agreements and contracts with investors, providing subsidies for certain expenses, custom duty and VAT exemptions when the agreed criteria are met.
Each of the 12 regions into which the country is divided has the authority to develop its own investment promotion campaigns.

Bilateral investment conventions signed by Morocco

To see the list of investment treaties signed by Morocco, consult UNCTAD's International Investment Agreements Navigator.