The government’s achievements at mid-term surpass all forecasts and expectations. With these words, Prime Minister Aziz Akhannouch summarized his administration’s performance before both houses of parliament on April 24.
According to him, his government, after two and a half years in office, has achieved a track record “honorable and reflecting the fulfillment of its commitments and promises.” This triumphant tone is motivated by progress made in the project of building a social state, particularly the universalization of compulsory health insurance (AMO), which Akhannouch highlighted as being “completed on schedule.”
This program covers 10 million people, representing 9.5 billion dirhams in annual contributions funded by the state. Meanwhile, the Unified Social Register (RSU) included 3.5 million families as of the end of March 2024.
On another note, the Prime Minister emphasized the government’s efforts to mitigate the effects of inflation. He cited initiatives such as the Awrach and Forsa programs, the payment of 20 billion dirhams in VAT arrears to SMEs impacted by the health crisis, the mobilization of an equivalent amount to combat water stress and ensure uninterrupted supply to the national market, and the halving of VAT on basic consumer goods.
A lot of figures, zero evaluation
The presentation was far from unanimous, according to an economist: “The government rushed to present a report filled with figures, without any evaluation of the programs or public policies, as required by the provisions of the Constitution.”
During his speech, Aziz Akhannouch did not fail to highlight the impacts of COVID-19, water stress, inflation, the Al Haouz earthquake, and regional conflicts on the first half of his team’s term. “Morocco is not isolated from this international context. This concerning situation has affected the national economy,” stated the Prime Minister.
An excuse, according to the Damir movement, which, in an open letter to Aziz Akhannouch, wrote: “No justification related to the pandemic risk, geopolitical turbulence external to our country, or rainfall variability can excuse your poor growth rate of 1.3% in 2022 and 2.9% in 2023 or the (…) net job losses in the national economy since your arrival at the head of the government.”
Employment: the dark spot
Employment, let’s not forget, represents the most pressing challenge for this government. As TelQuel previously noted (TelQuel No. 1076), this is the first administration since the Abbas El Fassi government to record more job losses than job creation, with no less than 181,000 net jobs destroyed in just half a term.
This has resulted in a rising unemployment rate, now hovering around 13%. The failure extends to women’s labor force participation, which was one of the 10 commitments Akhannouch outlined in his inaugural speech.
Instead of reaching the promised 30%, women’s access to the labor market has shrunk to just 19%. The erosion of jobs has driven the government to turn to the American consulting firm McKinsey to turn to the American consulting firm McKinsey in an effort to reverse the trend during the second half of its term.
In the broader economic landscape, the government recorded a 15% increase in business failures during the previous fiscal year. The picture is far from promising in the industrial sector, where, despite a flurry of announcements and memorandums of understanding, the industrial value added to GDP remains stagnant at 15%.
Energy: between delays and fears of conflicts of interest
In the energy sector, the situation is far from promising. The government continues to stall on the Samir refinery issue, has made no progress on the matter of strategic reserves, and, most notably, has failed to resolve the issue of price-fixing in the hydrocarbon import and distribution sector.
This is despite the Competition Council imposing a 1.84 billion dirham fine on operators, a figure far below the 60 billion dirhams in profits allegedly generated by the price-fixing scheme by the end of 2023, according to the Samir Safeguard Front. This fine, far from quelling the legitimate anger of consumers, has only served to highlight the risks of conflicts of interest surrounding the sector.
The lack of transparency, particularly regarding the distribution among operators and the payment modalities, has only deepened public distrust. This perception was further heightened by the awarding of the Casablanca desalination plant contract to a consortium led by an Akwa subsidiary, as well as the same group’s involvement in the equity structure of Sound Energy, the operator of the Tendrara gas field.
In the energy sector, as TelQuel previously noted (TelQuel No. 1083) the government has yet to undertake meaningful reforms in the areas of electricity production and transportation. This pressing need was recently reiterated by the Competition Council in an opinion published on March 28.
Regarding the investment initiative, although the government finalized its charter and strengthened the competencies of the supervising ministry—particularly by transferring the management of Regional Investment Centers from the Ministry of the Interior—Mohammed VI’s goal of increasing the private sector’s share in investment remains an unfulfilled aspiration.
Even worse, the public sector’s share of investment has only increased, reaching 300 billion dirhams in the 2024 Finance Law. This upward trend comes at a time when foreign direct investment (FDI) dropped by 53% between 2022 and 2023.
A government with free rein… however
Although the Prime Minister emphasized the cohesion of his majority during his speech, it is clear that the RNI, and thus Aziz Akhannouch, dominates the political landscape, particularly in terms of communication. This is evident in examples such as the rollout of the Forsa program by the Ministry of Tourism instead of the Ministry of Employment.
Another example is sector-specific negotiations, particularly regarding education and higher education reforms. The Prime Minister’s involvement, at the expense of the respective ministers, acted as a catalyst for the teachers’ protests in the education sector, even leading to a reversal of the maximum age limit of 30 for entering the teaching profession.
This disastrous scenario has further cemented the decline of union influence in favor of professional associations. These associations are not limited to the national education sector but are spreading across both public and private spheres. Some ministries, such as Health, have even begun preemptive negotiations to address grievances and avoid strikes altogether.
This hyper-interventionism by the Prime Minister is likely to impact public finances, as he is now compelled to make concessions to labor unions. A recent example is the general public sector salary increase of 1,000 dirhams, granted as part of the social dialogue, without any evaluation of the medium- and long-term impact such a measure will have on the public treasury.
The government appears to have clearly sidelined the middle class, which is not among its priorities, despite the continuous erosion of its standard of living.
Another significant omission in the government’s mid-term report is the New Development Model (NMD). Initially presented by Akhannouch during his inauguration as the cornerstone of his program, the NMD was supposed to be operational by 2035, with its first phase launched in 2022 and scheduled for completion in 2025. In other words, to adhere to the timeline set by the NMD, the government of Aziz Akhannouch would need to accomplish at least a third of the planned projects.
In the meantime, like its predecessors, this administration ultimately has only royal initiatives and projects as concrete achievements to present. And yet, no government has ever had as much freedom to implement its program. The right-wing coalition is tightly knit around three parties, with minimal ideological differences between the liberal RNI, the PAM fluctuating between center-right and center-left, and the conservative Istiqlal.
This trio controls 70% of both parliamentary chambers, all 12 of the kingdom’s regions, and the majority of municipal and rural councils in the country. The total absence of any effective opposition, whose limited influence cannot disrupt the government’s policymaking, eliminates any excuses for failure in implementing governmental policies.
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Written in French by Amine Ater and Younes Saoury, edited in English by Eric Nielson