MOROCCO ECONOMIC HIGHLIGHTS

UNCLAS SECTION 01 OF 02 RABAT 000039 SIPDIS SIPDIS DEPT FOR NEA/MAG, NEA/OFI AND INL/AAE DEPT ALSO FOR EB/TPP, EB/IFD AND DRL/IL STATE PASS USTR FOR DOUG BELL STATE PASS USAID FOR JENNIFER RAGLAND USDOC ITA/MAC/ANESA FOR DAVID ROTH USDOC FOR FSC/OIO AND CLDP USDOL FOR ILAB PARIS FOR ZEYA LONDON FOR TSOU ROME FOR ROSE E.O. 12958: N/A TAGS: ECON ELTN SENV MO SUBJECT: MOROCCO ECONOMIC HIGHLIGHTS REF: A) Rabat 2311 -------------- GOM Poverty Indicators Decline -------------- ¶1. Government of Morocco poverty figures indicate that from 1999 to 2004 the number of Moroccans living below the poverty line - defined as a monthly household income of $187 for a family of 5.6 people living in an urban setting, or $194 for a family of 6.4 people living in a rural setting - has fallen from 19 percent to just over 14 percent nationwide. The 2004 statistics indicate that 22 percent of rural families fall below this line, while only eight percent of urban-dwellers do. -------------- Slow Growth for 2005 -------------- ¶2. The Moroccan economy grew at a real rate of just 1.2 percent in 2005, below the expectations of the 2005 Budget Law. However, positive growth was maintained despite poor climatic conditions that led to a drop in the agricultural GDP of 16 percent. Moroccan GDP is still heavily dependant on agriculture, most of which is rain-fed and subject to the vagaries of the weather. GOM economic planners are trying to decrease the country's dependence on rain-fed agriculture, making GDP growth less dependent on climactic conditions. -------------- Tourism Brings in $4 Billion -------------- ¶3. Over five million tourists visited Morocco in 2005, a five percent increase over the previous year. Growth occurred mostly in traditional markets including France (20 percent),the UK (52 percent),Spain (28 percent) and Belgium (25 percent). French tourists ranked first with 1.2 million arrivals, followed by Spain (320,067),Great Britain (175,585),Germany (133,458),Belgium (116,505) and Italy (107,899). Tourist revenues reached $4 billion, approximately eight percent of GDP. -------------- Morocco Leads in Clean Development Projects -------------- ¶4. Morocco has become the first Arab country and the first in Africa to register projects with the UN's Clean Development Mechanism (CDM),which allows adherents of the Kyoto Protocol to purchase carbon dioxide credits to meet the greenhouse gas emission reduction targets they agreed to under the Protocol (Ref A). Morocco ratified the Kyoto Protocol in January 2002. -------------- Declining Road Fatalities -------------- ¶5. Road accident fatalities declined by seven percent in the first ten months of 2005, and serious injuries were down 11 percent. Transport Minister Karim Ghellab attributed the RABAT 00000039 002 OF 002 decline to a series of measures the GOM has taken to combat the problem of high traffic fatalities, including requiring medical check ups for truck and public transport drivers, increased enforcement of technical inspections and laws mandating the use of seat belts. Ninety-two percent of the nearly three million vehicles circulating in Morocco are more than five years old. Accidents kill 4,000 people annually and cost the country $1.2 billion. -------------- -- Five Million Sheep Slaughtered in Just Two Days -------------- -- ¶6. Officials estimate 4.9 million live sheep will be purchased and slaughtered during the January 10-11 Eid al- Adha holiday. Sheep are alaughtered and eaten countrywide as part of the Eid holiday celebration. The Ministry of Agriculture reports that more than six million head of sheep are available on the market this year. Prices are slightly higher than last year, at 32-40 dirhams (US$3.50-4.40) per kilo of live beast, meaning an average-sized sheep will cost $160, roughly a month's salary for a low-income family. Social pressure to purchase a large and costly sheep is great, and the annual expenditure is a difficult one for many Moroccan families. The GOM estimates that the Eid purchase accounts for 25 percent of the budget an average family spends each year on meat.