Moroccan economy 6.5 pct growth

Image via WikipediaRABAT (Reuters) - Morocco's economy grew 6.5 percent year-on-year in the second quarter, down from 7 percent a quarter earlier, but almost treble the rate a year ago as farms recovered from drought and telecoms and banking expanded.

Postal and telecom activity grew 13.6 percent year-on-year, up from 10.5 percent in the second quarter of 2007, while financial services grew 19.4 percent, up from 18 percent, the state High Planning Commission said late on Monday.

In the same quarter a year ago, the economy expanded 2.6 percent year-on-year.

Over a third of Moroccans are reliant on agriculture for their livelihood and cyclical droughts regularly take their toll on household incomes in the country of 33 million.

The government has sought to reduce the economy's exposure to farming and reverse decades of sluggish investment in industry and services, with financial sector reforms slashing lending rates and prompting a boom in consumer credit.

The result has been a pick-up in industries reliant on domestic demand such as construction, telecoms and retail.

The finance ministry said in July it expected economic growth of 6.3 percent annually over the next four years as investor-friendly reforms kick in and the kingdom pushes into new export industries and services.

Agriculture grew 11.2 percent in the second quarter, paring a 21.6 percent slump in the April-June period of 2007. Non-farm growth was 5.8 percent.

Manufacturing industries grew 4.3 percent, compared to 4.4 percent a year earlier and the construction sector expanded by 10.6 percent compared to 14.1 percent in the second quarter of last year.