Morocco has taken the lead in Africa's industrialization, according to the African Development Bank's (AfDB) Industrialization Index (IIA) 2025, published in May 2026. With a score of 0.8415, Morocco narrowly surpasses South Africa, which scores 0.8396. This index assesses industrial production, exports, employment, and diversification. Morocco's industrial performance is driven by various sectors, including automotive, aerospace, and renewable energy. The country's strategic location and investments in infrastructure have contributed to its industrial growth.
However, when evaluated by the United Nations Conference on Trade and Development's (UNCTAD) Productive Capacities Index (PCI), Morocco ranks 101st globally and sixth in Africa, with a score of 47.1. The PCI takes a broader approach, assessing a country's ability to produce goods and services, export them, and progress towards higher-value activities. This index considers factors such as human capital, natural capital, energy, transportation, and technology. The difference in rankings between the IIA and PCI reflects the distinct focuses of these indices.
The AfDB's IIA evaluates industrial performance based on three main components: industrial performance, direct determinants, and indirect determinants. Morocco's high ranking is attributed to its strong performance in industrial production, export diversification, and integration into international value chains. The country's investments in human capital, infrastructure, and technology have also contributed to its industrial growth. With a score of 0.8415, Morocco is considered the economy closest to the frontier of industrial development.
In contrast, the UNCTAD's PCI provides a more nuanced view of Morocco's productive capacities. The country's score of 47.1 reveals areas of strength and weakness. Morocco performs relatively well in technology and structural change, with scores of 57.4 and 57.8, respectively. However, its transportation sector lags behind, with a score of 32.8. This weakness is a significant challenge for Morocco's industrial development.
The disparity between Morocco's industrial performance and its productive capacities highlights the need for balanced growth. While the country has made significant strides in industrialization, its human capital and private sector development require attention. With a score of 46.5 in human capital, Morocco must invest in education and training to develop the skills needed for a competitive industry. Similarly, the private sector, with a score of 47.4, must be strengthened to support the growth of small and medium-sized enterprises.
The AfDB emphasizes the importance of integrating small and medium-sized enterprises (SMEs) into regional value chains. Access to financing, markets, and formalization tools is crucial for SMEs' growth and development. Morocco's policymakers must prioritize these areas to ensure that the benefits of industrialization are shared across the economy. By addressing these challenges, Morocco can sustain its industrial growth and improve its productive capacities.
Ultimately, Morocco's contrasting rankings in the IIA and PCI underscore the complexities of industrial development. While the country excels in industrial production, it must address its weaknesses in productive capacities. By focusing on human capital, private sector development, and SME integration, Morocco can achieve more balanced growth and reinforce its position as a leader in African industrialization.
Key points
- Morocco leads Africa in industrialization according to the AfDB's IIA but ranks sixth in productive capacities according to the UNCTAD's PCI.
- The country's transportation sector is a significant weakness, with a score of 32.8 in the PCI.
- Morocco must prioritize human capital development, private sector growth, and SME integration to sustain its industrial growth.
