In an integrated global economy, a country is fortunate if it can find a comparative advantage in an industry where major positions have not yet been taken. Morocco, within eyeshot of the European Union across the Strait of Gibraltar, has identified an opportunity to become an offshoring center for Europe's French- and Spanish-speaking companies. Our study shows that, from 2003 to 2018, business process offshoring in Morocco could add 0.3 percent annually to its GDP growth, reduce its international trade deficit by around 35 percent, and create a total of some 100,000 new jobs.¹

Morocco's need for new industrial growth is urgent. Competitors with lower costs and better access to natural resources are eroding the country's share of the global market for food processing and textiles, which together currently represent more than half of its industrial GDP and almost three-quarters of its exports (Exhibit 1). Without a proactive industrial-development policy, we reckon that Morocco's employment levels will stagnate, its trade deficit will increase, and its economy will grow at less than half the expected rate (Exhibit 2).