An Economic Assessment of the AfCFTA Impact on the Moroccan Economy

Sara Allali

No 333396, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: This article presents an assessment of the economic implementations of the ongoing African Continental Free Trade Area agreement (AfCFTA) on the Moroccan economy. In this study a two-level economic modeling work has been performed, firstly, beginning with the computable general equilibrium model , followed by a micro-simulation analysis.The implementation of the Agreement would result in the liberalization of trade in goods in conformity with the agreed terms of the AfCFTA; a 50% reduction in actionable trade barriers in the five priority service sectors (tourism, transportation, communication, financial services, and business services), as well as in health and education services that have received special attention due to the coronavirus (COVID-19)-induced crisis and a cut of 50% in actionable NTMs. Following the implementation of the AfCFTA, Morocco's GDP and output, are all expected to increase. On the trade front, a trade distortion in favor of Africa is expected. The second part of the study is conducted through a microsimulation model to assess the effects of AfCFTA on the reduction of poverty and social inequalities in Morocco. In terms of modeling, the approach used is non-parametric (Magher, 1993), capturing changes in the distribution of income as a result of shocks related to the implementation of the Agreement. In terms of outcomes, the impact of the implementation of the AfCFTA on poverty and social inequality in Morocco will be relatively modest. In conclusion, it can be observed that the impact of the AfCFTA will be felt mainly at the macroeconomic level, and more particularly in trade. Indeed, the Agreement will contribute to the expansion of trade between Morocco and the African countries.

Keywords: International Relations/Trade; International Relations/Trade (search for similar items in EconPapers)
Pages: 26
Date: 2022
New Economics Papers: this item is included in nep-ara, nep-des, nep-int and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:333396

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