Budget 2026: Morocco bets big on social state, green hydrogen, and territorial equity

Projected growth of 4.8% and controlled inflation

The Minister of Economy and Finance, Nadia Fettah, emphasized that the national economy should grow by 4.8% in 2025, driven by domestic demand and the dynamism of non-agricultural sectors. Inflation is controlled at 1.1% by the end of August 2025, while the budget deficit is expected to stabilize at 3.5% of GDP.

Four strategic priorities for 2026

1. Consolidation of economic gains

   • Stimulating private investments (both national and foreign)

   • Deployment of Morocco's green hydrogen offerings

   • Enhancing SMEs and the inclusion of youth and women

2. Integrated territorial development

   • Support for advanced regionalization

   • Reduction of territorial disparities (rural, mountainous, oasis areas)

3. Strengthening the social state

   • Generalization of social protection

   • Direct aid to 4 million families

   • Increase in child allowances and support for orphans

4. Structural reforms

   • Modernization of the organic finance law

   • Reform of public enterprises

   • Improvement of budget governance

Budget allocations: Health, Education, and Defense at the forefront

The PLF 2026 allocates an exceptional budget of140 billion dirhamsto health and education, along with the creation of27,000 new positions. The energy transition receives enhanced support through the development of green hydrogen and public-private partnerships. The defense sector sees the adoption of two decrees, including the establishment of aMilitary Scientific Research Council, reflecting a desire for strategic modernization.

Revenue and expenses: cautious yet ambitious balance

• Expected revenues:

  • Tax and customs revenues increase due to economic recovery

  • Targeted borrowing to finance structural investments

  • Diversification of funding sources through the Investment Charter

• Expenses:

  • Operations: maintaining essential public services

  • Investment: prioritizing infrastructure, education, health, and energy transition

Comparison with previous budgets

Compared to 2025, the PLF 2026 marks a clear break:

• +20 billion dirhams for social sectors

• Focus on direct aid and territorial equity

• Reduction of the budget deficit (from 4% to 3.5% of GDP)

• Stabilization of inflation despite global tensions

Upcoming challenges: Sustainability, equity, and recovery

The PLF 2026 embodies a strong political will to combine growth and social justice. However, several challenges remain:

• Budgetary sustainability in the face of external shocks

• Reduction of territorial and social inequalities

• Success of the energy transition without increasing debt

• Mobilization of revenues without increasing tax pressure

As highlighted byNadia Fettah : "Morocco must succeed in balancing economic ambition with social inclusion in a changing world."