RABAT, Morocco / AfricaWire.IO / – Morocco and the African Development Bank Group have signed a €434.4 million financing agreement to speed up the structural transformation of the Moroccan economy. The funding, worth nearly 4.8 billion dirhams, aims to foster stronger and more inclusive growth that can withstand external and climate-related shocks. The agreement was signed in Rabat on Friday, November 13. It supports the third phase of the Economic Governance and Climate Change Resilience Support Programme (PGRCC-Phase III).
Fouzi Lekjaa, Minister of Economy, Finance and Public Performance and Governor of the Bank for Morocco, signed for the government. Achraf Hassan Tarsim, the African Development Bank’s Country Manager for Morocco, signed on behalf of the lender. The programme aims to strengthen the private sector’s role as a driver of investment and value creation. It also seeks to refocus the state on its strategic functions.
The operation is aligned with the Bank Group’s Four Cardinal Points and with Morocco’s strategic priorities. The Four Cardinal Points form the strategic framework set out by Bank President Sidi Ould Tah. Those priorities include accelerating economic transformation and strengthening the country’s long-term resilience. The new phase will consolidate reforms carried out under earlier phases of the programme. It will also help Morocco cope with the effects of the crisis in the Middle East, particularly higher energy and transport costs.
Two pillars of reform
The first component will strengthen public sector capacity. It covers the restructuring of the public enterprise portfolio, the modernization of the public-private partnership framework and improvements to the business environment. The second component targets the Kingdom’s climate and energy resilience. It supports the modernization of water and electricity governance and faster deployment of renewable energy to help Morocco move to a low-carbon economy.
Energy costs have risen sharply this year, with Brent crude climbing above $115 a barrel at the end of October. Morocco imports most of its energy needs, leaving it exposed to price swings on global markets. Higher fuel prices also raise transport and production costs for businesses and households. The AfDB financing is designed to cushion the economy from such external shocks while keeping reforms on track.
Third phase builds on earlier support
The PGRCC programme began with a first phase of €120 million, signed in Rabat in December 2024. A second phase worth €181.8 million followed in 2025, according to reports. With the third phase, total AfDB support under the programme reaches about €736 million. The phases form part of a broader partnership between Morocco and the Bank Group, one of the country’s main development lenders. The Bank has financed projects in Morocco across energy, water, transport and agriculture.
Morocco has also secured backing from other lenders for its energy transition, including World Bank support for hydropower storage worth $265 million. The country aims to expand renewable energy and improve water management as climate pressures grow. The new AfDB financing adds to these efforts as Morocco seeks to build a more competitive and resilient economy.