A CGE Analysis of Economy-wide Impacts of Climate Change on Agriculture in Morocco

Climate change is one of the major risks facing developing countries in Africa for which agriculture is a predominant part in the economy. Alterations in rainfall patterns and increasing temperatures will most likely translate into yield reductions in desirable crops (Gommes et al. 2009). The early literature of economic impact assessment of climate change has provided some useful insights on the issue, but remained limited in scope and depth as it focused on highly aggregated unit of analysis (e.g. at the continental or sub-continental levels). Nonetheless, the current trend of the empirical literature on the issue of economic impact assessment of climate change display a shift towards engaging in ‘case-by-case’ analyses at the country and/or sub-country level, especially given the fact that consensus is growing among policymakers on the need to act upon the challenges of climate change, and more importantly due to increased availability of climate projections at finer geographical scales that helps refine the analyses, and improves our ability to capture the intricate linkages that exist between climate change and the economy. This calls for adequate policy responses at the country and regional levels. The present research will focus its attention on Morocco. In this context, the objectives of the analysis is to quantify the economic-wide impacts of climate-driven yield alterations under 3 SRES scenarios (A1b, A2 and B1) using a modified version of IFPRI ’s CGE model, which was upgraded to account for the sub-regional disaggregation adopted in the analysis (Dudu and Cakmak, 2011). This part of the analysis will focus on country-specific economywide impacts driven by productivity shocks on yields for each region. Yield estimates are produced via CliCrop, which simulates yield changes by water basin based.