Economic growth is projected to expand modestly by 2.7% in 2018 through sustained agricultural and services growth, continued strengthening of tourism, and gradual recovery of tourism, phosphate and manufacturing. In the medium term, economic growth is projected to pick up gradually to 3.5% in 2019-20 against a backdrop of an improved business climate through structural reforms and greater security and social stability.
Inflation is projected to increase to 6.7% in 2018, driven by the Dinar depreciation, the VAT rate increase, and the increase in prices of certain products (e.g., fuels, tobacco, telecom) while monetary tightening and fiscal consolidation will partly counteract inflationary pressures.
Unemployment remained high at 15.5% in 2017 despite a low labor force participation, at about 50%, mainly due to weak participation of women (28%). Most of the unemployed are low-skilled, but university graduates have the highest unemployment rate, which increased from 15% in 2005 to 23% in 2010 and 31% in 2017. Unemployment rates are also much higher among women and in interior regions.
The methodology to measure poverty was recently updated by the National Institute of Statistics to better reflect current living conditions. The official poverty rate estimate for 2015 was 15.2%, down from 20.5% in 2010 and 23.1% in 2005. Regional disparities are an enduring feature, with the North West and Center West showing rates almost twice the national average. Inequality, as measured by the Gini index, is estimated at 30.9%, down from 36% in 2005. The dynamics of monetary indicators of welfare appear to be at odds with the perception of lower standards of living in household surveys.