Morocco tops North Africa in the 2025 Economic Freedom Index, ranking 86th globally with a score of 60.3. Its economic indicators show improvements, particularly in business and monetary freedoms. However, challenges remain in labor market rigidity and costly licensing requirements. Continued reforms are essential for enhancing competitiveness and economic diversification.
Recently, Morocco has achieved the top position among North African countries in the 2025 Economic Freedom Index, as reported by the Index of Economic Freedom. Globally, Morocco ranks 86th with a score of 60.3, placing it 7th out of 14 nations in the Middle East and North Africa region, surpassing Kuwait while trailing behind Saudi Arabia. This year’s score reflects an improvement of 3.5 points from the previous year.
The Heritage Institute’s report delineates Morocco’s economy as “moderately free.” It highlights key aspects such as a well-structured regulatory environment, with business freedom (68.9) and monetary freedom (74.7) exceeding the global averages, though labor freedom remains below the world average at 48.5. Moreover, open market components have scored highly, including a trade freedom rating of 67.2 and scores of 75 for both investment freedom and financial freedom.
The report indicates a trade-weighted average tariff rate of 13.9 percent, affirming that both foreign and domestic investors are entitled to equal treatment under Morocco’s legal system. Morocco’s progressive financial sector continues to develop, providing diverse financing opportunities, while its stock exchange welcomes foreign participation without restrictions.
Morocco’s advancements in economic freedom are largely attributed to ongoing reforms that stimulate greater dynamism in the private sector, enhancing competitiveness and diversifying the market’s productive base. The report further emphasizes the country’s maintained monetary stability, characterized by relatively low inflation levels.
Despite these improvements, the report addresses challenges necessitating deeper institutional reforms. It notes that while the processes for establishing and registering private enterprises are more efficient, the associated licensing requirements remain prohibitively expensive. Additionally, concerns were raised regarding the rigidity of Morocco’s labor market, which reportedly hinders robust job growth and marginalizes a significant portion of the informal labor sector.
The Index of Economic Freedom encompasses evaluations of economic policies and conditions for 184 countries from July 1, 2023, to June 30, 2024. It uses 12 indicators within four primary pillars: Rule of Law, Government Size, Regulatory Efficiency, and Open Markets. Each indicator receives a score between 0 to 100, averaging to provide a country’s final score.
The countries are subsequently classified into five categories based on their scores, ranging from “Free” (80 to 100 points) to “Economically Repressed” (0 to 49.9 points). In North Africa, Mauritania ranks 119th (Mostly Unfree), Egypt at 145th (Mostly Unfree), Tunisia at 149th (Economically Repressed), and Algeria at 160th (Economically Repressed).
Globally, the top five positions in the index are occupied by Singapore (84.1 points), Switzerland (83.7 points), Ireland (83.1 points), Taiwan (79.7 points), and Luxembourg (79.5 points).
In conclusion, Morocco’s commendable ranking in the 2025 Economic Freedom Index underscores its progress toward economic liberalization, marked by improved scores in business and monetary freedoms. However, the country must address significant challenges related to labor market rigidity and the cost of bureaucratic processes to further enhance its economic landscape. Overall, Morocco’s journey reflects its commitment to fostering a more robust and competitive economy.
Original Source: www.moroccoworldnews.com
