Egypt, Morocco and Jordan : macroeconomic policy and agricultural development

A conceptual framework for evaluating exchange rate and price policies is developed and then applied to each country. The study finds that the three countries face similar economic constraints: large fiscal and current account deficits coupled with a dependence on external forces (exports of raw materials, international credit or aid, and worker remittances) for economic growth. All three countries recognize the need to reduce their dependence on external forces by promoting exports. Jordan tries to maximize income from its greatest national asset, a skilled and educated labor force, by providing financial and other services to the Mideast. Morocco has adopted an aggressive program (including currency devaluations and changes in investment law) to stimulate agricultural and manufactured exports. Egypt has also adopted an array of export promotion policies, but its exchange rate policies do not clearly encourage exports and its agricultural price policies continue to discriminate against production and exports. Of the three, Morocco should be most effective in promoting horticultural exports.