Spain – Morocco
In 2016, the economy experienced some disappointing events.
After 4,5% growth in 2015, GDP growth slowed to 1,1% (EH had expected 1,5%). Agricultural production was the main laggard (-10,1%) due to severe drought conditions. This, combined with subdued demand from major trading partners (Spain and France), reduced export growth to a mere 2,5% in 2016. Since imports (up 9,5% in 2016) were driven by capital goods (implementation of past investment plans), the current account deficit unexpectedly worsened to -4,2% of GDP in 2016 (up from -2,2% in 2015). Last but not least, the fiscal deficit reached -4,2% of GDP, significantly higher than the initial forecast of -3%. Conditions are expected to normalize in 2017. Improved weather conditions are now in place, which will allow for sustained growth acceleration of 4,5%. External demand should also improve in 2017. Export gains are projected at €1.800 billion, more than triple the figure achieved in 2016, and the current account deficit should narrow to -2,7% of GDP.
Source: Solunion
Weekly Export Risk Outlook – Euler hermes
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