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!Reinout De Bock, Daniel F lorea, and

Joël Toujas-Bernaté !

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WP/10/238

!6!7898!:/0()/30$&/3%!1&/(03);!<./4! =>?98?7@A!!!! I M F Working Paper ! !! 1$44%(!-3*0!3/4!B(/0)3%!C*$3!D(#3)0,(/0!!!

Spillovers f rom Europe into Morocco and Tunisia1 !

Prepared by Reinout De Bock , Daniel F lorea, and Joël Toujas-Bernaté !

C.0E&)$F(4!+&)!4$*0)$G.0$&/!G;!H&I%!5&.J3*KL()/30M!!

N20&G()!7898!!!

Abstract!!

This Working Paper should not be reported as representing the views of the I M F .!5E(!'$(O*!(P#)(**(4!$/!0E$*!=&)Q$/R!>3#()!3)(!0E&*(!&+!0E(!3.0E&)S*T!3/4!4&!/&0!/(2(**3)$%;!)(#)(*(/0!0E&*(!&+!0E(!:1<!&)!:1<!#&%$2;U!=&)Q$/R!>3#()*!4(*2)$G(!)(*(3)2E!$/!#)&R)(**!G;!0E(!3.0E&)S*T!3/4!3)(!#.G%$*E(4!0&!(%$2$0!2&,,(/0*!3/4!0&!+.)0E()!4(G30(U!

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! @!

I . IN T R O DU C T I O N

5E$*!#3#()!(P3,$/(*!0E(!(++(20!&+!R)&O0E!*E&2Q*!$/!-.)&#(3/!2&./0)$(*!&/!(2&/&,$2!320$'$0;!$/!1&)&22&!3/4!5./$*$3U7!L&0E!1&)&22&!3/4!5./$*$3!E3'(!03Q(/!*$R/$+$23/0!*0(#*!0&!&#(/!.#!0E($)!(2&/&,$(*!3/4!*$R/(4!3**&2$30$&/!3R)((,(/0*!O$0E!0E(!-.)&#(3/!V/$&/!S-VT!$/!0E(!,$4!/$/(0$(*U@!:/!0E(!#3*0!4(234(W!0E(*(!2&./0)$(*!E3'(!300)320(4!*$R/$+$23/0!$/+%&O*!&+!+&)($R/!4$)(20!$/'(*0,(/0!S<D:TW!%$G()3%$F(4!0)34(!3/4!%&O()(4!0E(!(/0);!G3))$()*!+&)!+&)($R/!G3/Q*!$/0&!4&,(*0$2!+$/3/2$3%!,3)Q(0*U!5&43;W!0E(;!)(%;!&/!-.)&#(!+&)!3!%3)R(!*E3)(!&+!0E($)!(P0()/3%!)(2($#0*!S(P#&)0*W!0&.)$*,!)(2($#0*W!O&)Q()*`!)(,$003/2(*!3/4!<D:TW!3/4!R)&O0E!$*!%$Q(%;!0&!G(!*$R/$+$23/0%;!$/+%.(/2(4!G;!('(/0*!$/!0E($)!,3$/!-.)&#(3/!#3)0/()*U!C%0E&.RE!0E(!R%&G3%!2)$*$*!$/!788Ai8e!4$4!/&0!23.*(!3!)(2(**$&/!$/!1&)&22&!&)!5./$*$3W!0E(!)(2(**$&/!$/!0E(!-V!E34!3!2%(3)!$,#320!&/!0E($)!(P0()/3%!)(2($#0*U!

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I I . B A C K G R O UND A ND D A T A D ESC RIPT I O N

A . E conomic Policy and L inks with Partner Countries

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!\!V/%(**!&0E()O$*(!*#(2$+$(4W!G;!(P#&)0*W!O(!./4()*03/4!(P#&)0*!&+!R&&4*U!

\!!

<$R.)(!9U!5&03%!:,#&)0*!3/4!-P#&)0*!!S1$%%$&/*!&+!V"DW!9ee8i788AT!

! !

"&.)2([!B&./0);`*!3.0E&)$0$(*]!3/4!:1<!*03++!(*0$,30(*U!

-P#&)0*W!0&.)$*,!3/4!)(,$003/2(*!3)(!*$F3G%(!$/!G&0E!1&)&22&!3/4!5./$*$3W!3%0E&.RE!0E($)!$,#&)03/2(!'3)$(*!G(0O((/!0E(!0O&!2&./0)$(*!S<$R.)(!7TU!b(%30$'(!0&!cD>W!(P#&)0*!3)(!*.G*03/0$3%%;!E$RE()!$/!5./$*$3!0E3/!$/!1&)&22&U!:/!2&/0)3*0W!0&.)$*,!3/4!)(,$003/2(*!3##(3)!0&!G(!,&)(!$,#&)03/0!$/!1&)&22&U!<&)!(P3,#%(W!0E(!)30$&!&+!)(,$003/2(*!0&!cD>!$/!1&)&22&!$*!4&.G%(!0E(!)30$&!$/!5./$*$3U!!

<$R.)(!7U!"E3)(*!&+!-P#&)0*W!5&.)$*,W!3/4!b(,$003/2(*W!788A!!S:/!#()2(/0!&+!cD>T!!

"&.)2([!B&./0);`*!3.0E&)$0$(*]!3/4!:1<!*03++!(*0$,30(*U!!!!

0

10000

20000

30000

40000

50000

Exports FOB

Imports CIF

Exports to the EU

(a) Morocco 

AssociationAgreement with the EU

0

10000

20000

30000

Exports FOB

Imports CIF

Exports to the EU

(b) Tunisia 

AssociationAgreement with the EU

22.4

8.0 8.7

0.0

10.0

20.0

30.0

40.0

50.0

Exports Tourism Remittances

(a) Morocco 

42.7

6.14.4

0.0

10.0

20.0

30.0

40.0

50.0

Exports Tourism Remittances

(b) Tunisia 

! g!

Box 1. Association Agreements

(a) The Association Agreement Between Morocco and the European Union

5E(!-VK1&)&22&!C**&2$30$&/!CR)((,(/0!O3*!*$R/(4!$/!<(G).3);!9eegW!3/4!(/0()(4!$/0&!+&)2(!$/!13)2E!7888W!+&%%&O$/R!$0*!)30$+$230$&/!G;!0E(!>3)%$3,(/0*!&+!0E(!-V!1(,G()!"030(*W!0E(!-.)&#(3/!>3)%$3,(/0!3/4!0E(!1&)&223/!>3)%$3,(/0U!!

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

:/!788AW!1&)&22&!&G03$/(4!m34'3/2(4!*030.*m!)(%30$&/*W!3!,&'(!OE$2E!#)&'$4(*!R)(30()!322(**!0&!0E(!-Vk*!$/0()/3%!,3)Q(0!3/4!OE$2E!#%32(*!1&)&22&!3!/&02E!3G&'(!0E(!,(,G()*!&+!0E(!m/($REG&)E&&4!#&%$2;Um!V/4()!0E(!0(),*!&+!0E(!34'3/2(4!*030.*W!1&)&22&!O$%%!3%*&!#3)0$2$#30(!$/!-.)&#(3/!2$'$%!3/4!,$%$03);!2)$*$*!,3/3R(,(/0!&#()30$&/*W!3*!O(%%!3*!$/!3!/.,G()!&+!-.)&#(3/!3R(/2$(*W!*.2E!3*!-.)&#&%W!0E(!-.)&#(3/!C$)!"(2.)$0;!CR(/2;W!3/4!0E(!-.)&#(3/!1&/$0&)$/R!B(/0()!+&)!D).R*!3/4!D).R!C44$20$&/U!

(b) The Association Agreement between Tunisia and the European Union

5./$*$3!*$R/(4!3!G$%30()3%!C**&2$30$&/!CR)((,(/0!O$0E!0E(!-V!$/!H.%;!9ee\!3/4!$,#%(,(/0(4!$0!$/!13)2E!9eeAU!C/!3,(/4,(/0!2&'()$/R!3R)$2.%0.)3%!#)&4.20*!O3*!$,#%(,(/0(4!&/!H3/.3);!9W!7889U!!5E(!CR)((,(/0!E3*!0E)((!,3$/!+(30.)(*U!<$)*0W!$0!%$G()3%$F(4!0)34(!)(%30$&/*!0E)&.RE!0E(!$,,(4$30(!3G&%$0$&/!&+!X.3/0$030$'(!)(*0)$20$&/*!3/4!3!R)34.3%!)(4.20$&/!&+!0)34(!G3))$()*!OE$2E!2.%,$/30(4!$/!+)((!0)34(!+&)!$/4.*0)$3%!R&&4*!$/!788AU!5)34(!%$G()3%$F30$&/!#()03$/$/R!0&!3R)$2.%0.)(!#)&4.20*!3/4!/(R&0$30$&/*!0&!%$G()3%$F(!0E(!0)34(!&+!*()'$2(*!3)(!*0$%%!&/R&$/RU!"(2&/4W!$0!2&/0)$G.0(4!0&!E3),&/$F$/R!5./$*$3`*!)(R.%30&);!+)3,(O&)Q!O$0E!0E(!&/(!$/!#%32(!$/!0E(!-VW!#3)0$2.%3)%;!+&)!0)34(K)(%30(4!#&%$2$(*W!/&),*!3/4!*03/43)4*!$/2%.4$/R!$/!0)3/*#&)0!3/4!0(%(2&,,./$230$&/*W!322&./0$/R!3/4!+$/3/2$3%!*()'$2(*W!3/4!*030$*0$2*U!5E$)4W!$0!#)&'$4(4!*.##&)0!+&)!*(20&)*!+32$/R!,&)(!4$++$2.%0$(*!0&!34J.*0!0&!0E(!0)34(!%$G()3%$F30$&/!S0E(!n,$*(!o!/$'(3.” pr&R)3,T!3/4!(/E3/2(4!2&&#()30$&/W!/&03G%;!$/!0E(!4('(%&#,(/0!&+!$/+)3*0).20.)(U!5E(!-.)&#(3/!Z($REG&)E&&4!>&%$2;!G.$%4*!&/!0E(!C**&2$30$&/!CR)((,(/0!G;!+&2.*$/R!0E(!G$%30()3%!2&&#()30$&/!G(0O((/!5./$*$3!3/4!0E(!-V!&/!,&)(!03)R(0(4!#)&R)3,*U!:0!O3*!4('(%&#(4!$/!788^!3/4!2&/2%.4(4!O$0E!5./$*$3!$/!788\U!:0!#)&'$4(*!$/2)(3*(4!+$/3/2$3%!*.##&)0!3/4!+3'&)*!(/E3/2(4!)(R$&/3%!2&&#()30$&/!+&)!0)34(!$/0(R)30$&/!3/4!0E(!4('(%&#,(/0!&+!$/+)3*0).20.)(!S#3)0$2.%3)%;!+&)!(/()R;W!0)3/*#&)0W!3/4!$/+&),30$&/!0(2E/&%&R;T]!$,#)&'(,(/0*!$/!0E(!G.*$/(**!2%$,30(!S#3)0$2.%3)%;!0E)&.RE!*0)(3,%$/(4!03P30$&/!3/4!2.*0&,*!#)&2(4.)(*W!3/4!*0)(/R0E(/(4!$/0(%%(20.3%!3/4!#)&#()0;!)$RE0*T]!3/4!3!2&/*&%$430(4!,32)&(2&/&,$2!+)3,(O&)QU!!5E(!-V!$*!0E(!,3$/!4(*0$/30$&/!&+!(P#&)0*!+&)!G&0E!1&)&22&!3/4!5./$*$3!S<$R.)(!@TU!5E(!-V`*!3'()3R(!*E3)(!$/!1&)&223/!(P#&)0*!+&)!0E(!#()$&4!788\i8A!O3*!h8!#()2(/0U!<&)!5./$*$3!0E$*!*E3)(!$*!*%$RE0%;!E$RE()W!30!hh!#()2(/0U!5E(!-V!#%3;*!3/!('(/!,&)(!#)&,$/(/0!)&%(!OE(/!$0!2&,(*!0&!

! h!

0&.)$*,!3/4!)(,$003/2(*U!5E(!3'()3R(!*E3)(*!+&)!0&.)$*,!)('(/.(*!3/4!)(,$003/2(*!&)$R$/30$/R!+)&,!0E(!-V!4.)$/R!0E(!*3,(!#()$&4!S788\i8AT!3)(!G(0O((/!A8!#()2(/0!3/4!e8!#()2(/0U!1&)(&'()W!0E(*(!*E3)(*!3##(3)!0&!G(!)(%30$'(%;!*03G%(!&'()!0$,(U!

<$R.)(!@U!-V!"E3)(*!$/!-P#&)0*W!5&.)$*,!3/4!b(,$003/2(*!!S:/!#()2(/0W!3'()3R(!788\i8AT!

!

"&.)2([!B&./0);`*!3.0E&)$0$(*]!3/4!:1<!*03++!(*0$,30(*!

!N0E()!2E3//(%*!,$RE0!3%*&!G(!(P#%&)(4!0&!(P3,$/(!0E(!$/0())(%30$&/!G(0O((/!0E(!-.)&#(3/!V/$&/!3/4!1&)&22&!3/4!5./$*$3`*!(2&/&,$(*W!*.2E!3*!$,#&)0*W!+&)($R/!4$)(20!$/'(*0,(/0!S<D:T!+%&O*W!3*!O(%%!3*!+$/3/2$3%!%$/Q3R(*U!b(R3)4$/R!<D:W!3%0E&.RE!0E(*(!+%&O*!3)(!R(/()3%%;!'&%30$%(W!<$R.)(!^!*.RR(*0*!0E30!0E(;!)(#)(*(/0!3!#&0(/0$3%%;!$,#&)03/0!0)3/*,$**$&/!2E3//(%!G(0O((/!0E(!-V!3/4!0E(!1&)&223/!3/4!5./$*$3/!(2&/&,$(*U!=(!2&/*$4()!E&O('()!0E30!0E(!(++(20!&+!<D:!$*!,3$/%;!*0).20.)3%!3/4!,3/$+(*0*!$0*(%+!$/!0E(!,(4$.,!0&!%&/R!0(),U!C*!*.2EW!$0!$*!%(**!*.$0(4!+&)!3/!3/3%;*$*!2(/0()(4!&/!G.*$/(**!2;2%(*!2&))(%30$&/*U!!

<$R.)(!^U!<D:!$/!1&)&22&!3/4!5./$*$3!!SC'()3R(!788\i8AT!

"&.)2([!B&./0);`*!3.0E&)$0$(*]!3/4!:1<!*03++!(*0$,30(*U! !

EU70

EU79

EU87

Other30

Other21

Other, 13

0%

20%

40%

60%

80%

100%

Exports Tourism Remittances

(a) Morocco

EU77

EU85

EU88

Other23

Other, 15 Other, 12

0%

20%

40%

60%

80%

100%

Exports Tourism Remittances

(b) Tunisia

4.9

6.2

0

2

4

6

8

10

Morocco Tunisia

(a) In percent of GDP

EU80

EU58

Other20

Other42

0%

20%

40%

60%

80%

100%

Morocco Tunisia

(b) EU share in total FDI

! A!

5.)/$/R!0&!0E(!0)3/*,$**$&/!&+!*E&2Q*!0E)&.RE!+$/3/2$3%!2E3//(%*W!0E(!1&)&223/!3/4!5./$*$3/!G3/Q$/R!*;*0(,*!E3'(!%$,$0(4!%$/Q*!O$0E!$/0()/30$&/3%!,3)Q(0*U!L3/Q$/R!320$'$0$(*!3)(!+./4(4!$/!%3)R(!#3)0!O$0E!4&,(*0$2!4(#&*$0*!Sh\!#()2(/0!&+!G3/Q*`!)(*&.)2(*!$/!1&)&22&!3/4!A8!#()2(/0!$/!5./$*$3T!3/4!2)&**KG&)4()!+$/3/2$/R!$*!*,3%%U!:/!788e!*E&)0K0(),!+&)($R/!%$3G$%$0$(*!&+!1&)&223/!3/4!5./$*$3/!G3/Q*!0&!(P0()/3%!2&./0()#3)0*!)(#&)0(4!0&!0E(!L3/Q!+&)!:/0()/30$&/3%!"(00%(,(/0*!SL:"T!)(#)(*(/0(4!&/%;!@U@!3/4!9U7!#()2(/0!&+!0E($)!)(*#(20$'(!cD>!S53G%(!9TU!1&)(&'()W!$/!G&0E!2&./0)$(*!0E(!23#$03%!322&./0!$*!&/%;!#3)0$3%%;!&#(/U!"('()3%!)(*0)$20$&/*!3##%;!0&!0)3/*320$&/*!$/!+&)($R/!2.))(/2;W!+&)($R/!G&))&O$/R!3/4!+&)($R/!$/'(*0,(/0!G;!4&,(*0$2!+$),*!SL&P!7TU!!!

53G%(!9U!L3/Q*`!-P0()/3%!D(G0!"030$*0$2*W!7888i8e!S:/!#()2(/0!&+!cD>T!

!!

"&.)2([!L3/Q!+&)!:/0()/30$&/3%!"(00%(,(/0*W!B&./0);!3.0E&)$0$(*]!3/4!:1<!*03++!23%2.%30$&/*U!

<&)($R/!G3/Q*!E3'(!/&/K/(R%$R$G%(!#)(*(/2(*!$/!0E(!0O&!2&./0)$(*`!G3/Q$/R!*;*0(,*U!13J&)$0;K&O/(4!+&)($R/!G3/Q*!322&./0(4!+&)!79U^!#()2(/0!&+!0&03%!G3/Q$/R!3**(0*!$/!1&)&22&!S788AT!3/4!+&)!7eU^!#()2(/0!$/!5./$*$3!S788eTU!5E$*!#)(*(/2(!,$RE0!#%3;!3!)&%(!$/!0(),*!&+!$/2)(3*(4!2&,#(0$0$&/W!$,#)&'(4!G3/Q$/R!#)320$2(*!3/4!4$'()*$+$230$&/!&+!+./4$/R!*&.)2(*!G.0W!3*!$/!0E(!23*(!&+!$,#&)0*!3/4!<D:*W!0E(*(!(++(20*!3)(!,&)(!%$Q(%;!0&!3##(3)!$/!0E(!%&/R!)./U!Z('()0E(%(**W!0E(!$,#320!&+!0E(!&#(/$/R!&+!0E(!4&,(*0$2!,3)Q(0!0&!+&)($R/!G3/Q*!$/!1&)&22&!3/4!5./$*$3!$*!3!*.GJ(20!0E30!4(*()'(*!3!,.%0$#%(K3/R%(4!3/3%;*$*!OE$2E!R&(*!G(;&/4!0E(!#.)#&*(!&+!&.)!#3#()U!!! !

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009Morocco Liabilities to BIS banks 17.7 16.1 15.3 11.9 10.8 8.9 7.5 7.9 8.4 9.8S‐T Liabilities to BIS banks 4.8 5.3 4.7 2.7 2.6 2.6 3.2 2.9 2.1 3.3TunisiaLiabilities to BIS banks 7.7 7.0 7.2 7.3 7.5 5.6 6.1 5.7 5.2 4.8S‐T liabilities to BIS banks 2.6 2.0 1.7 1.7 1.7 1.5 2.0 1.4 1.2 1.2

! e!

!Box 2. Some of the Remaining Restrictions on Foreign Cur rency

T ransactions and Capital flows

(a) Morocco

1&)&223/!(P#&)0()*!&+!R&&4*!3/4!*()'$2(*!,3;!&#(/!+&)($R/!(P2E3/R(!322&./0*!4&,(*0$23%%;!3/4!4(#&*$0!.#!0&!\8!#()2(/0!&+!0E(!)(#30)$30(4!+&)($R/!(P2E3/R(!)(2($#0*!+)&,!(P#&)0*U!<&)($R/!)(*$4(/0*!3/4!2&)#&)30$&/*!,3;!&#(/!+&)($R/!(P2E3/R(!322&./0*!O$0E&.0!%$,$030$&/*U!!B&,,()2$3%!G3/Q*!,3;!G&))&O!3G)&34!&/%;!0&!+$/3/2(!+&)($R/!0)34(!&)!$/'(*0,(/0!&#()30$&/*!&/!G(E3%+!&+!2.*0&,()*!&)!3*!#3)0!&+!0E(!$/0)&4.20$&/!&+!0E(!+&)O3)4!2&'()!+&)!2.*0&,()*`!+&)($R/!(P2E3/R(!*O3#*W!O$0E!,30.)$0$(*!(X.3%!0&!0E(!4.)30$&/!&+!0E(!E(4R$/R!&#()30$&/*!&++()(4U!!5E()(!3)(!/&!2&/0)&%*!&/!$/O3)4!4$)(20!$/'(*0,(/0U!N.0O3)4!4$)(20!$/'(*0,(/0*!3)(!*.GJ(20!0&!3##)&'3%W!G.0!)(*$4(/0!2&)#&)30$&/*!$/!&#()30$&/!+&)!,&)(!0E3/!0E)((!;(3)*!G(/(+$0!+)&,!2()03$/!+32$%$0$(*U!b(*$4(/0!+&)($R/!/30$&/3%*!3)(!+)((!0&!$/'(*0!3G)&34W!#)&'$4(4!0E(!&#()30$&/*!3)(!+$/3/2(4!+)&,!0E($)!&O/!+./4*!3G)&34!&)!+)&,!0E($)!E&%4$/R*!4(/&,$/30(4!$/!2&/'()0$G%(!4$)E3,!&)!+&)($R/!(P2E3/R(U!!C!/.,G()!&+!,(3*.)(*!O()(!03Q(/!4.)$/R!788e!0&!+.)0E()!%$G()3%$F(!0E(!23#$03%!322&./0U!!!

(b) Tunisia

>)&+(**$&/3%!322&./0*!$/!+&)($R/!2.))(/2;!,3;!G(!&#(/(4!G;!)(*$4(/0!$/4$'$4.3%*W!5./$*$3/!%(R3%!(/0$0;!3/4!+&)($R/!%(R3%!(/0$0;!$/!5./$*$3!O$0E!+&)($R/!2.))(/2;!3**(0*!$/!2&//(20$&/!O$0E!$0*!320$'$0$(*U!C.0E&)$F30$&/!G;!0E(!B(/0)3%!L3/Q!&+!5./$*$3!SLB5T!$*!)(X.$)(4!+&)!)(*$4(/0*!0&!&#(/!322&./0*!3G)&34U!-P#&)0!#)&2((4*!,.*0!G(!)(#30)$30(4!O$0E$/!3!0$,(!%$,$0!+)&,!0E(!#3;,(/0!4.(!430(U!p&O('()W!)(*$4(/0!(P#&)0()*!,3;!)(03$/!.#!0&!988!#()2(/0!&+!0E($)!+&)($R/!(P2E3/R(!(P#&)0!#)&2((4*U!5E(!32X.$*$0$&/!&+!3**(0*!S23#$03%!3/4!,&/(;!,3)Q(0!$/*0).,(/0*T!3G)&34!G;!)(*$4(/0*!$*!*.GJ(20!0&!3.0E&)$F30$&/U!b(*$4(/0*!3)(!3%*&!)(X.$)(4!0&!)(#30)$30(!3%%!$/2&,(!+)&,!$/'(*0,(/0!3G)&34W!3*!O(%%!3*!3%%!#)&2((4*!+)&,!0E(!4$'(*0$0.)(!&)!%$X.$430$&/!&+!*.2E!$/'(*0,(/0*U!"0&2Q*!$/!(P$*0$/R!2&,#3/$(*!$/!5./$*$3!,3;!G(!32X.$)(4!+)((%;!O$0E!+&)($R/!(P2E3/R(!0)3/*+())(4!+)&,!3G)&34!G;!+&)($R/!/&/)(*$4(/0*U!p&O('()W!0E(!32X.$*$0$&/!G;!+&)($R/()*!&+!*E3)(*!O$0E!'&0$/R!)$RE0*!$*!*.GJ(20!0&!0E(!3##)&'3%!&+!0E(!p$RE!:/'(*0,(/0!B&,,$**$&/U!Z&/)(*$4(/0*!,3;!3%*&!*(%%!+)((%;!*E3)(*!&+!2&,#3/$(*!(*03G%$*E(4!$/!5./$*$3U!5E(;!,3;!3%*&!0)3/*+()!+)((%;!/(0!)(3%!#)&2((4*!+)&,!0E(!*3%(!&+!*E3)(*!0E30!O()(!#.)2E3*(4!O$0E!+&)($R/!(P2E3/R(!0)3/*+())(4!+)&,!3G)&34U!!"&.)2([!:/0()/30$&/3%!1&/(03);!<./4W!788eW!Annual Report on Exchange Arrangements and Exchange Restrictions (AREAER).!!

B . Correlation of G rowth Rates with European Partners

c)&O0E!)30(*!&+!1&)&22&!3/4!5./$*$3W!&/!&/(!E3/4W!3/4!0E($)!Q(;!-.)&#(3/!#3)0/()*W!&/!0E(!&0E()!E3/4W!3##(3)!*0)&/R%;!#&*$0$'(%;!2&))(%30(4!$/!0E(!%3*0!4(234(U!:/!&.)!(2&/&,(0)$2!3/3%;*$*W!O(!.*(!)(3%!/&/3R)$2.%0.)3%!;(3)K&/K;(3)!R)&O0E!)30(*!&+!cD>!*()$(*!+&)!1&)&22& WMOR NA

tg !3/4!

! 98!

5./$*$3 WTUN NAtg Ug!5E(*(!*()$(*!3)(!*(3*&/3%%;!34J.*0(4!3/4!3'3$%3G%(!&/!3!X.3)0()%;!G3*$*U!<&)!0E(!

-VW!3!2&./0);K*#(2$+$2!2&,#&*$0(!cD>!R)&O0E!)30(! S TEUtg !$*!23%2.%30(4!3*!3!O($RE0(4!3'()3R(!

&+!R)&O0E!)30(*!&+!0E(!,3$/!-V!#3)0/()*!G3*(4!&/!0E(!O($RE0*!0E(*(!2&./0)$(*!03Q(!$/!1&)&22&`*!3/4!5./$*$3`*!(P#&)0*!&+!R&&4*!)(*#(20$'(%;U!5E(!2&./0);!O($RE0*!3)(!2&/*0).20(4!G;!0E(!:1<!+&)!0E(!c%&G3%!-2&/&,$2!-/'$)&/,(/0!Sc--TU!5E(!3##(/4$P!2&/03$/*!0E(!+&),.%3!+&)! S TEU

tg !3/4!03G%(*!O$0E!0E(!c--!O($RE0*!.*(4!+&)!1&)&22&!3/4!5./$*$3U!

53G%(!7U!f&%30$%$0;!3/4!B&))(%30$&/!B&(++$2$(/0*!&+!c)&O0E!b30(*W!7888l9i788el^!!

! WMOR NAtg ! S TEU

tg MOR ! WTUN NAtg ! S TEU

tg TUN ! S Ttg Oil !WMOR NA

tg ! 1.69 ! ! ! !! ! ! ! ! !

S TEUtg MOR ! 8U^g! 2.08 ! ! !

! S@U79T! ! ! ! !! ! ! ! ! !WTUN NA

tg ! ! ! 1.59 ! !! ! ! ! ! !! ! ! ! ! !

S TEUtg TUN ! ! ! 8Ug@! 2.05 !

! ! ! S\U8gT! ! !

S Ttg Oil ! 8U9g! ! K8U8h! ! 14.60 ! S8UeAT! ! SK8U^@T! ! !

"&.)2([!:1<!*03++!(*0$,30(*U!

"03/43)4!4('$30$&/*!3)(!&/!0E(!4$3R&/3%!3/4!2&))(%30$&/*!&++K4$3R&/3%U!L(0O((/!G)32Q(0*!3)(!0E(!5K*030*!+&)!0E(! /.%%! E;#&0E(*$*! 0E30! 3! *$/R%(! 2&))(%30$&/! 2&(++$2$(/0! $*! (X.3%! 0&! F()&U! Oil! $*! 0E(! *#&0! #(0)&%(.,! #)$2(!S3'()3R(!&+!<30(EW!L)(/0!3/4!=5:T!$/!V"q!*23%(4!G;!V"!B>:U!

!53G%(!7!*E&O*!3!*0)&/R!#&*$0$'(!2&))(%30$&/!G(0O((/!0E(!R)&O0E!)30(* S TEU

tg MOR 3/4 WMOR NAtg !3/4

S TEUtg TUN O$0E WTUN NA

tg Uh!5E$*!2&))(%30$&/!$*!^g!#()2(/0!+&)!1&)&22&!3/4!g@!#()2(/0!+&)!5./$*$3U!"030$*0$23%!0(*0*!)(J(20!0E(!E;#&0E(*$*!0E30!0E(*(!2&))(%30$&/*!3)(!(X.3%!0&!F()&U!5E(!03G%(!3%*&!*E&O*!0E30!0E()(!$*!/&!*0)&/R!2&))(%30$&/!G(0O((/!R)&O0E!$/!)(3%!#(0)&%(.,!*#&0!#)$2(*W! S Ttg Oil W!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!g!=(!(P2%.4(!3R)$2.%0.)3%!&.0#.0!+)&,!cD>!3*!0E$*!2&,#&/(/0!)(,3$/*!%3)R(%;!4(#(/4(/0!&/!2%$,30$2!+320&)*!$/!G&0E!2&./0)$(*U!:/!OE30!+&%%&O*W!./%(**!&0E()O$*(!*#(2$+$(4W!O(!./4()*03/4!/&/3R)$2.%0.)3%!cD>!OE(/!)(+())$/R!0&!1&)&22&!3/4!5./$*$3`*!cD>U!!h!=(!+&./4!*$,$%3)!/.,G()*!OE(/!23%2.%30$/R!0E(!2&))(%30$&/!&+!1&)&223/!3/4!5./$*$3/!R)&O0E!)30(*!O$0E!(.)&F&/(!cD>!)(#&)0(4!G;!-.)&*030U!!

! 99!

3/4!1&)&223/!&)!5./$*$3/!R)&O0E!)30(*U!5E$*!*.RR(*0*!0E30!0E(!2&))(%30$&/*!&+! WMOR NAtg !3/4

WTUN NAtg !O$0E!R)&O0E!$/!0E($)!-.)&#(3/!#3)0/()*!3)(!/&0!E$4$/R!0E(!(++(20!&+!3!R%&G3%!2;2%(UA!

I I I . EST I M A T IN G T H E SPI L L O V E RS

A . Identification Scheme

=(!#)&2((4!O$0E!3!fCbKG3*(4!$4(/0$+$230$&/!*2E(,(!$/!&)4()!0&!(*0$,30(!0E(!$,#320!&+!3/!$//&'30$&/!$/!-V!R)&O0E!&/!1&)&22&!3/4!5./$*$3!/&/3R)$2.%0.)3%!cD>!R)&O0EU!1&)(!*#(2$+$23%%;W!+&)!2&./0);!JW!0E(!'3)$3G%(*!$/2%.4(4!$/!0E(!G3*(%$/(!fCb!3)([!!

WS TW kUEU j NAt t tZ g j g !

5E(!)(4.2(4K+&),!fCb!$*[!!

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!

OE()(!2!$*!3!2&/*03/0!3/4! tZ !$*!0E(!,30)$P!O$0E!'3)$3G%(*U!5E(!)(4.2(4K+&),!)(*$4.3%*! tu 3)(!

,3##(4!$/0&!0E(!*0).20.)3%!*E&2Q*! t !G;!0E(!*0).20.)3%!,30)$P oA [!

8 Ut tA u !

=(!.*(!0E(!$/'()*(!&+!0E(!BE&%(*Q$!+320&)!&+!0E(!'3)$3/2(K2&'3)$3/2(!,30)$P!V!0&!$4(/0$+;!*0).20.)3%!*E&2Q*!0E30!3)(!&)0E&R&/3%!0&!(32E!&0E()W! IE tt k W!OE()(!I!$*!0E(!$4(/0$0;!,30)$PU!5E$*!2&))(*#&/4*!0&!0E(!3**.,#0$&/!0E30!&/!$,#320!*0).20.)3%!*E&2Q*!$/!5./$*$3!E3'(!3!F()&!(++(20!&/!*E&2Q*!$/!-.)&#(3/!#3)0/()!2&./0)$(*U!:0!$*!$,#&)03/0!0&!/&0(!0E30!2E3/R$/R!0E(!&)4()$/R!&+!0E(!'3)$3G%(*!$/!Z!4$4!/&0!2E3/R(!&.)!)(*.%0*U!

B . Responses to External G rowth Shock

<&)!(32E!2&./0);!O(!.*(!0E(!%&/R(*0!3'3$%3G%(!X.3)0()%;!4303!+&)!0E(!fCb!(*0$,30$&/U!<&)!1&)&22&W!0E(!*3,#%(!2&'()*!0E(!#()$&4!9ee8l9!0&!788el^W!OE()(3*!+&)!5./$*$3!0E(!4303*(0!$*!+)&,!7888l9!0&!788el^U!e!D(*#$0(!2&'()$/R!3!)(%30$'(%;!*E&)0!0$,(!*#3/W!0E(*(!4303*(0*!3%%&O!.*!0&!23#0.)(!0E(!)(2(/0!#()$&4!&+!E$RE!R)&O0E!O$0E!$,#&)03/0!*0).20.)3%!2E3/R(*!+&%%&O(4!G;!0E(!34'()*(!*E&2Q!&+!788Ai8eU!=(!$/2%.4(!0O&!%3R*!$/!0E(!(*0$,30(4!fCb*U!C22&)4$/R!0&!0E(!"2EO3)F!$/+&),30$&/!2)$0()$3W!0E$*!$*!0E(!&#0$,3%!%3R!%(/R0E!+&)!G&0E!1&)&22&!3/4!5./$*$3U!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!A!5K0(*0*!3%*&!+3$%!0&!)(J(20!0E(!E;#&0E(*$*!0E30!2&))(%30$&/*!&+!1&)&223/!&)!5./$*$3/!cD>!R)&O0E!)30(*!O$0E!V"!)(3%!cD>!R)&O0E!3)(!*$R/$+$23/0%;!4$++()(/0!+)&,!F()&U!

e!"$,.%30$&/*!)./!+&)!1&)&22&!&/!0E(!7888l9i788el^!0$,(!$/0()'3%!%(34!0&!'();!*$,$%3)!)(*.%0*!0&!0E(!&/(*!#)(*(/0(4!$/!0E$*!#3#()U!

! 97!

<$R.)(!\!*E&O*!$,#.%*(!)(*#&/*(!+./20$&/!S:b<*T!&+!R)&O0E!$/!1&)&22&!3/4!5./$*$3!0&!3!&/(!*03/43)4!4('$30$&/!*E&2Q!$/!0E(!R)&O0E!&+!cD>!$/!0E(!(2&/&,$2!#3)0/()*U!5E(!R)3#E!3%*&!$/2%.4(*!*03/43)4!())&)!G3/4*!(/2&,#3**$/R!0E(!e\!#()2(/0!2&/+$4(/2(!$/0()'3%U!5E(!$,#.%*(!)(*#&/*(!&+!G&0E!1&)&22&!3/4!5./$*$3!cD>!R)&O0E!0&!-V!cD>!R)&O0E!$*!*$R/$+$23/0%;!4$++()(/0!+)&,!F()&!$/!0E(!+$)*0!+&.)!X.3)0()*U!C!'3)$30$&/!&+!&/(!#()2(/03R(!#&$/0!$/!-V!cD>!R)&O0E!#)&4.2(*!3!*$,$%3)!#(3Q!)(*#&/*(!$/!1&)&22&!S8U\e!$/!0E(!*(2&/4!X.3)0()T!2&,#3)(4!0&!5./$*$3!S8Ug7!$/!0E(!0E$)4!X.3)0()T!G.0!R(/()30(*!3!,&)(!3G).#0!3/4!*E&)0!%$'(4!)(*#&/*(!+&)!1&)&22&W!OE$%(!0E(!)(*#&/*(!$*!,&)(!#()*$*0(/0!$/!0E(!23*(!&+!5./$*$3U!!

C*!3!)&G.*0/(**!2E(2QW!O(!3%*&!)('()*(4!0E(!&)4()!&+!0E(!R)&O0E!)30(*!$/!0E(!fCbW!3/4!+&./4!*$,$%3)!)(*.%0*U!C*!(P#(20(4W!$/!3%%!0E(!"fCb*W!R)&O0E!*E&2Q*!$/!1&)&22&!3/4!5./$*$3!R(/()30(!/&/*$R/$+$23/0!)(*#&/*(*!&/!R)&O0E!$/!0E(!-V!#3)0/()!2&./0)$(*U98!

<$R.)(!\U!b(*#&/*(!&+!D&,(*0$2!c)&O0E!0&!3/!-P0()/3%!c)&O0E!"E&2Q!

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5E(!'3)$3/2(!4(2&,#&*$0$&/*!)(#&)0(4!$/!53G%(!@!*E&O!E&O!,.2E!&+!0E(!+&)(23*0!())&)!'3)$3/2(!&+!3!2&./0);`*!cD>!R)&O0E!23/!G(!(P#%3$/(4!G;!0E(!*0).20.)3%!*E&2Q*!0&!cD>!R)&O0E!$/!-V!#3)0/()!2&./0)$(*U!5E(!*E3)(!(P#%3$/(4!G; S TEU

tg MOR 3/4! S TEUtg TUN $/2)(3*(*!30!%&/R()!

E&)$F&/*U!C0!3!98KX.3)0()!+&)(23*0!E&)$F&/W!*E&2Q*!0&! S TEUtg MOR (P#%3$/!99!#()2(/0!&+!

1&)&22&`*!cD>!R)&O0E!OE()(3*!*E&2Q*!0& S TEUtg TUN !(P#%3$/!@A!#()2(/0!&+!5./$*$3`*!cD>!

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‐1

‐0.5

0

0.5

1

1.5

1Q 2Q 3Q 4Q 5Q 6Q 7Q 8Q 9Q 10Q

(a) Morocco

0.55

‐1

‐0.5

0

0.5

1

1.5

1Q 2Q 3Q 4Q 5Q 6Q 7Q 8Q 9Q 10Q

(b) Tunisia

0.59

! 9@!

53G%(!@U!<&)(23*0!-))&)!f3)$3/2(!D(2&,#&*$0$&/*!!-P#%3$/(4!G;! S TEU

tg !S$/!rT!Quarter  Morocco  Tunisia 

1  0.49  3.78 

2  6.01  17.20 

3  8.12  28.94 

4  9.91  34.55 

5  10.51  36.71 

6  10.71  37.28 

7  10.74  37.31 

8  10.74  37.36 

9  10.74  37.58 

10  10.75  37.90 !

!!!!"&.)2([!:1<!*03++!(*0$,30(*U!

C . A lternative Identification of Shocks

=(!3/3%;F(!0E(!)&G.*0/(**!&+!0E(!(3)%$()!)(*.%0*!G;!2&/*$4()$/R!3!%&/RK)./!$4(/0$+$230$&/!*2E(,(!+&)!0E(!*0).20.)3%!*E&2Q*!$/!-V!#3)0/()!2&./0)$(*U!"#(2$+$23%%;W!)30E()!0E3/!$4(/0$+;$/R!0E(!*0).20.)3%!*E&2Q!$/!-V!#3)0/()!2&./0)$(*!G;!$,#&*$/R!3!F()&!)(*#&/*(!&/!$,#320W!O(!$4(/0$+;!0E$*!*E&2Q!G;!3**.,$/R!0E30!R)&O0E!$/!1&)&22&!&)!5./$*$3!E3*!/&!%&/RK)./!$,#320!&/!cD>!$/!#3)0/()!2&./0)$(*U!5E$*!3**.,#0$&/!23/!G(!,&0$'30(4!G;!0E(!*$F(!&+!1&)&22&!&)!5./$*$3`*!(2&/&,;!2&,#3)(4!0&!0E30!&+!#3)0/()!2&./0)$(*U!<&%%&O$/R!L%3/2E3)4!3/4!l.3E!S9eAeTW!0E(!'3)$3G%(*!$/2%.4(4!$/!0E(!G3*(%$/(!fCb!3)(!&)4()(4!3*!G(+&)([!!

WS TW kUEU j NAt t tZ g j g !

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5E(!$4(/0$+$230$&/!3**.,#0$&/!+&)!0E(!%&/RK)./!)(*0)$20$&/!$*!0E(/[!!

S9W[T s S9W9T 8t !<$R.)(!g!*E&O*!0E30!0E(!:b<*!0&!*0).20.)3%!*E&2Q*!$/!-V!#3)0/()!2&./0)$(*!$4(/0$+$(4!.*$/R!0E$*!%&/RK)./!)(*0)$20$&/!*2E(,(!)(*(,G%(!0E(!*E&2Q*!$4(/0$+$(4!$/!0E(!*E&)0K)./!$4(/0$+$230$&/!*2E(,(U!=(!3%*&!344(4!:b<*!0&!3!&/(!*03/43)4!4('$30$&/!*E&2Q!&+!0E(!)(4.2(4K+&),!)(*$4.3%W!*&!O$0E&.0!,3Q$/R!3/;!$4(/0$+;$/R!)(*0)$20$&/!&/!0E(!2&))(%30$&/!,30)$P!&+!0E(!)(*$4.3%* tu U!5E(!+$R.)(!*.RR(*0*!0E30!G&0E!0E(!*E&)0K)./!3/4!%&/RK)./!)(*0)$20$&/*!4&!/&0!$,#&*(!G$R!0)3/*+&),30$&/*U!!

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"&.)2([!:1<!*03++!(*0$,30(*U!

I V . D E C O MPOSIN G T H E SPI L L O V E RS B Y T R A NSM ISSI O N C H A NN E LS

5&!R(0!3!*(/*(!&+!0E(!)(%30$'(!$,#&)03/2(!&+!4$++()(/0!0)3/*,$**$&/!2E3//(%*!O(!+&%%&O!0E(!3##)&32E!#)&#&*(4!$/!L3;&.,$!3/4!"O$*0&/!S788eTU!5E(!"fCb*!3)(!3.R,(/0(4!&/(!30!3!0$,(!O$0E!4303!&/!0)34(W!0&.)$*,!3/4!)(,$003/2(*!3*!(P&R(/&.*!'3)$3G%(*U!5E(!#&0(/0$3%!2&/0)$G.0$&/! kc !&+!3!#3)0$2.%3)!2E3//(%!k!$*!0E(/!23%2.%30(4!3*[!!

Uk kc r r !5E(!2&/0)$G.0$&/! kc !$*!0E(!4$++()(/2(!G(0O((/!0E(!)(*#&/*(*!&+!R)&O0E!$/!1&)&22&!&)!5./$*$3!0&!R)&O0E!$/!#3)0/()!2&./0)$(*!SrT!,$/.*!0E(!)(*#&/*(!&+!R)&O0E!OE(/!0E(!*#$%%&'()!$*!$/2%.4(4!3*!3/!(P&R(/&.*!'3)$3G%(!S kr TU!5E(!$4(3!$*!0E30!344$/R!0E(!(P&R(/&.*!'3)$3G%(!0&!0E(!fCb!%(3'(*!$/! kr !0E(!#3)0!&+!0E(!)(*#&/*(!0E30!$*!/&0!3**&2$30(4!O$0E!0E(!0)3/*,$**$&/!2E3//(%!k!S<$R.)(!hTU!!!

<$R.)(!hU!L3;&.,$!3/4!"O$*0&/!C##)&32E!

!"&.)2([!:1<!*03++!(*0$,30(*U!

!5E$*!3##)&32E!4&(*!/&0!(P2%.4(!0E(!(P$*0(/2(!&+!&0E()!)(%('3/0!0)3/*,$**$&/!2E3//(%*!3/4!4&(*!/&0!322&./0!+&)!0E(!2&%%$/(3)$0;!G(0O((/!0E(!4$++()(/0!2E3//(%*U!5E$*!3%*&!$,#%$(*!0E30!0E(!*&.)2(*!&+!*#$%%&'()*! kc !3)(!/&0!/(2(**3)$%;!)(X.$)(4!0&!*.,!.#!0&!0E(!$,#.%*(!)(*#&/*(!rU!C*!*.2EW!O(!

‐1

‐0.5

0

0.5

1

1.5

1Q 2Q 3Q 4Q 5Q 6Q 7Q 8Q 9Q 10Q

(a) Morocco

Short‐run Long‐run

Reduced‐1

‐0.5

0

0.5

1

1.5

1Q 2Q 3Q 4Q 5Q 6Q 7Q 8Q 9Q 10Q

(b) Tunisia

Short‐run Long‐run

Reduced

! 9\!

#)(+()!0&!0E$/Q!&+!0E$*!0(2E/$X.(!3*!3!R3.R(!#)&'$4$/R!3/!$/4$230$&/!&+!0E(!)(%30$'(!$,#&)03/2(!&+!0E(!,3J&)!2E3//(%*!3/4!/&0!3*!3!#)(2$*(!G)(3QK4&O/!&+!0E(!$,#.%*(!)(*#&/*(U!99!!!

<$R.)(!AU!B.,.%30$'(!b(*#&/*(*!0&!c)&O0E!://&'30$&/!$/!>3)0/()!B&,#&*$0(!

"&.)2([!:1<!*03++!(*0$,30(*U!

<$R.)(!A!*E&O*!0E(!2.,.%30$'(!$,#320!&+!0E(!4$++()(/0!2&/0)$G.0$&/*! kc !4(0(),$/(4!O$0E!0E$*!,(0E&4!+&)!1&)&22&!3/4!5./$*$3W!OE()(!0E(!*0).20.)3%!*E&2Q*!3)(!$4(/0$+$(4!3*!$/!"(20$&/!:::UCU!=(!3%*&!$/2%.4(!0E(!2.,.%30$'(!$,#.%*(!)(*#&/*(!+./20$&/!&+!0E(!"fCb*!(*0$,30(4!$/!"(20$&/!:::ULU!5E(!3/3%;*$*!*.RR(*0*!0E30W!$/!0E(!23*(!&+!5./$*$3W!(P#&)0*W!3/4!0&!3!,.2E!%(**()!(P0(/0!0&.)$*,W!3)(!0E(!,3J&)!0)3/*,$**$&/!2E3//(%*U!b(,$003/2(*!*((,!0&!#%3;!3!'();!%$,$0(4!)&%(!30!0E(*(!+)(X.(/2$(*U!<&)!1&)&22&W!0E(!)(*.%0*!*E&O!0E30!G(*$4(*!(P#&)0*W!OE$2E!*0$%%!#%3;!3/!$,#&)03/0!)&%(W!)(,$003/2(*!3/4!0&.)$*,!3)(!3%*&!,3J&)!0)3/*,$**$&/*!2E3//(%*!+&)!*#$%%&'()*U!B)&**K2&))(%30$&/*!G(0O((/!0E(!0E)((!+%&O*!3)(!*$R/$+$23/0!$/!0E(!23*(!&+!1&)&22&U!

5E(*(!)(*.%0*!3)(!$/!%$/(!O$0E!0E(!320.3%!('&%.0$&/*!$/!(P#&)0*W!0&.)$*,!3/4!)(,$003/2(*!&G*()'(4!4.)$/R!0E(!)(2(/0!*%&O4&O/!$/!-.)&#(!S<$R.)(!eTU!:/!1&)&22&!3%%!0E(!0E)((!'3)$3G%(*!*0)&/R%;!)(*#&/4(4!0&!0E(!*E3)#!4)&#!$/!-V!cD>U97!:/!5./$*$3W!&/!0E(!&0E()!E3/4W!(P#&)0*!O()(!0E(!,&*0!3++(20(4U!5&.)$*,!)(2($#0*!$/!5./$*$3!O()(!%(**!3++(20(4W!OE$%(!)(,$003/2(*!*E&O(4!3!)(,3)Q3G%;!*0)&/R!)(*$%$(/2(U!!

! !

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!99!<&)!,&)(!4(03$%*!&/!0E$*!3##)&32EW!*((!L3;&.,$!3/4!"O$*0&/!S788eTU!!97!5&03%!(P#&)0!#()+&),3/2(!$/!1&)&22&!$*!3%*&!$/+%.(/2(4!G;!*E3)#!+%.20.30$&/*!$/!$/0()/30$&/3%!#)$2(*!3/4!'&%.,(*!&+!#E&*#E30(!(P#&)0*U!5E(!*E3)(!&+!#E&*#E30(!$/!0&03%!(P#&)0*!O3*!A!#()2(/0!$/!788hW!9^!#()2(/0!$/!788AW!3/4!h!#()2(/0!$/!788eU!l.3/0$0$(*!4(2)(3*(4!9g!#()2(/0!$/!788A!3/4!\8!#()2(/0!$/!788eW!OE()(3*!#)$2(*!,&)(!0E3/!0)$#%(4!$/!788A!3/4!+(%%!^9!#()2(/0!$/!788eU!!

0.18 0.400.68

1.021.37

1.690.10

0.37

0.75

1.21

0.00

1.00

2.00

0.00

1.00

2.00

3.00

4.00

5.00

Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8

(a) Morocco Remittances

Tourism

Exports

(IR) RHS

4.16 (1.52)

0.75

1.47

1.972.28 2.44 2.46 2.39

0.28

0.370.41 0.41 0.38

0.00

1.00

2.00

3.00

Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8

(b) Tunisia

Remittances

Tourism

Exports

(IR)

2.88 (2.31)

! 9g!

<$R.)(!eU!b(320$&/*!0&!0E(!b(2(/0!"%&O4&O/!$/!-.)&#(!S@!,&/0E!,&'$/R!3'()3R(!;K&K;!R)&O0E!)30(*!&+!'3)$3G%(*!$/!%&23%!2.))(/2;W!$/!#()2(/0T!

"&.)2([!B&./0);`*!3.0E&)$0$(*]!3/4!:1<!*03++!(*0$,30(*U!!

V . SE C T O R A L A N A L YSIS

:/!0E$*!*(20$&/!O(!0(*0!0E(!)&G.*0/(**!&+!0E(!#)('$&.*!)(*.%0*!G;!(P3,$/$/R!0E(!)(*#&/*(!&+!R)&O0E!$/!4$++()(/0!*(20&)*!0&!R)&O0E!*E&2Q*!$/!-V!#3)0/()!2&./0)$(*U!5&!0E$*!3$,W!O(!)(K)./!0E(!"fCb!3/4!)(#%32(!0E(!/&/3R)$2.%0.)3%!cD>!R)&O0E!)30(*!+&)!5./$*$3!3/4!1&)&22&!O$0E!0E(!cD>!R)&O0E!)30(*! Wj SECTOR

tg !$/!#3)0$2.%3)!*(20&)*U!C*!$/!"(20$&/!:::!LW!0E(!$,#.%*(!)(*#&/*(!,(3*.)(*!0E(!)(320$&/!&+!0E(*(!*(20&)*`!'3%.(!344(4!R)&O0E!)30(!0&!0E(!2&./0);K*#(2$+$2!-V!cD>!2&,#&*$0(U!<&)!2&./0);!JW!0E(!'3)$3G%(*!$/2%.4(4!$/!0E(!fCb!3)(!0E(/[!!!

W W S T kUj SECTOR EUt t tZ g g j !

!:/!%$/(!O$0E!0E(!)(*.%0*!#)(*(/0(4!$/!"(20$&/!:fW!<$R.)(!98!*E&O*!0E30!$/!1&)&22&!*()'$2(K)(%30(4!*(20&)*W!OE$2E!3)(!,&)(!*$R/$+$23/0%;!$/+%.(/2(4!G;!0&.)$*,!3/4!0)3/*+()*W!3##(3)!0&!G(!,&)(!*(/*$0$'(!0&!0E(!-.)&#(3/!2;2%(U!"(20&)*!*.2E!3*!,3/.+320.)$/RW!2&/*0).20$&/W!,$/$/R!3/4!(/()R;!4&!/&0!*((,!0&!G(!*$R/$+$23/0%;!$/+%.(/2(4U!L;!2&/0)3*0W!$/!5./$*$3!(P#&)0K&)$(/0(4!*(20&)*W!*.2E!3*!,3/.+320.)$/R!3/4!(/()R;W!3)(!0E(!,&*0!)(*#&/*$'(U!CR)$2.%0.)(W!,$/$/R!3/4!&0E()!*()'$2(*!*E&O!O(3Q!)(320$&/*!0&!0E(!'3)$30$&/*!$/!-V!cD>U!!

<$R.)(!98U!B.,.%30$'(!b(*#&/*(!&+!"(20&)!c)&O0E!0&!3/!-P0()/3%!c)&O0E!"E&2Q!

"&.)2([!:1<!*03++!(*0$,30(*U!

‐50

‐30

‐10

10

30

50

Jun‐08 Oct‐08 Feb‐09 Jun‐09 Oct‐09 Feb‐10

Exports

Tourism receipts

Remittances

(a) Morocco

‐50

‐30

‐10

10

30

50

Jun‐08 Oct‐08 Feb‐09 Jun‐09 Oct‐09 Feb‐10

Exports

Tourism receipts

Remittances

(b) Tunisia

0

1

2

3

4

5

Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10

(a) Morocco  

Commerce

Other  Services

Transports&Telecom

Non‐responsive sectors:‐ Manufacturing‐ Agriculture‐ Mining‐ Construction‐ Energy

0

4

8

12

16

Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10

(b) Tunisia 

Manufacturing

Energy

Transports&Telecom

Construction

Non‐responsive sectors:‐ Agriculture‐ Mining‐ Other services

! 9h!

V I . PO L I C Y I MPL I C A T I O NS

5E(!(2&/&,(0)$2!3/3%;*$*!4(,&/*0)30(*!0E30W!+&)!G&0E!5./$*$3!3/4!1&)&22&`*!(2&/&,$(*W!0E(!-.)&#(3/!V/$&/!#%3;*!3!Q(;!)&%(U!N.)!3/3%;*$*!2&/+$),*!0E(!)&G.*0/(**!&+!0E$*!2&//(20$&/!3/4!(P3,$/(*!)(%30$'(!$,#&)03/2(!&+!$0*!4$++()(/0!0)3/*,$**$&/!2E3//(%*U!=E$%(!0E(*(!2%&*(!0$(*!O$0E!0E(!-.)&#(3/!V/$&/!E3'(!G((/!3!2(/0)3%!+320&)!2&/0)$G.0$/R!0&!0E(!#)&2(**!&+!&#(/$/R!.#!0E(!0O&!(2&/&,$(*!3/4!$,#)&'$/R!0E($)!2&,#(0$0$'(/(**W!0E(;!,$RE0!3%*&!)(#)(*(/0!3!2E3%%(/R(!+&)!0E(!+.0.)(U!!

b(3%!&.0#.0!4)&##(4!G;!,&)(!0E3/!^!#()2(/0!$/!0E(!-.)&!C)(3!$/!788eU!1&)(&'()W!2.))(/0!+&)(23*0*!3)(!0E30!0E(!)(G&./4!$/!0E(!-V!3)(3!O$%%!G(!,&4(*0!3/4!*%&OU!c)&O0E!$/!G&0E!4&,(*0$2!4(,3/4!3/4!)(3%!cD>!O$%%!*03;!G(%&O!0E($)!#)(K2)$*$*!%('(%*!$/!0E(!;(3)*!0&!2&,(!S<$R.)(!99TU!b(2(/0!2&/2()/*!3G&.0!*&'()($R/!4(G0!3/4!0E(!*.*03$/3G$%$0;!&+!#.G%$2!+$/3/2(*!$/!"&.0E()/!-.)&#(3/!2&./0)$(*!344!+.)0E()!4&O/*$4(!)$*Q*!0&!0E$*!&.0%&&QU!

<$R.)(!99U!-.)&!C)(3jb(3%!cD>!3/4!b(3%!:,#&)0*!c)&O0E!S:/!#()2(/0T!

! !"&.)2([!:1<W!=&)%4!-2&/&,$2!N.0%&&Q!SC#)$%!7898T!3/4!=&)%4!-2&/&,$2!N.0%&&Q!V#430(!SH.%;!7898TU!

Z&0!&/%;!O$%%!)(3%!cD>!R)&O0E!$/!-.)&#(!G(!%&O()W!G.0!0E(!(/R$/(*!&+!R)&O0E!$/!-.)&#(!3)(!(P#(20(4!0&!2E3/R(W!O$0E!%(**!2&/0)$G.0$&/!2&,$/R!+)&,!0E(!4&,(*0$2!4(,3/4U!C*!3!)(*.%0W!R)&O0E!$/!-.)&#(3/!$,#&)0*jOE$2E!)(#)(*(/0*!0E(!,3$/!*&.)2(!&+!(P0()/3%!4(,3/4!+&)!1&)&22&!3/4!5./$*$3j$*!#)&J(20(4!0&!G(!%(**!0E3/!E3%+!2&,#3)(4!0&!0E(!#)(K2)$*$*!#()$&4!$/!7898!3/4!7899!S<$R.)(!99TU!!

:0!$*!/&0(O&)0E;!0E30!+&%%&O$/R!0E(!3**&2$30$&/!3R)((,(/0*!0E(!,3)Q(0!*E3)(*!&+!1&)&22&!3/4!5./$*$3!$/!-V!,()2E3/4$*(!$,#&)0*!E3'(!/&0!$/2)(3*(4!*$/2(!9eeeU!53G%(!^!*E&O*!0E30!0E(*(!,3)Q(0!*E3)(*!E3'(!)(,3$/(4!+3$)%;!*03G%(!&)!*%$RE0%;!4(2)(3*(4!&'()!0E(!#3*0!4(234(U!"('()3%!+320&)*!23/!(P#%3$/!0E$*!('&%.0$&/W!*.2E!3*!0E(!$/2)(3*(4!%$G()3%$F30$&/!&+!O&)%4!0)34(!./4()!0E(!=5N!3R)((,(/0*!3/4!0E(!+$()2(!2&,#(0$0$&/!+)&,!+3*0KR)&O$/R!(P#&)0()*!*.2E!3*!BE$/3!3/4!-3*0()/!-.)&#(U!CR3$/*0!0E$*!G32Q4)&#W!,3$/03$/$/R!,3)Q(0!*E3)(!$*!,&)(!0E3/!E&/&)3G%(U!!

!

‐4.1

1.0 1.8 1.7

‐12

‐10

‐8

‐6

‐4

‐2

0

2

4

2007 2008 2009 2010 2011 2012 2013 2014 2015

Real GDP(growth rates, in percent)Average

2000‐07:2.1

Forecast

‐12.2

2.2 2.44.4

‐14

‐12

‐10

‐8

‐6

‐4

‐2

0

2

4

6

2007 2008 2009 2010 2011 2012 2013 2014 2015

Real Imports of goods (growth rates, in percent)

Average2000‐07:

5.8

Forecast

! 9A!

53G%(!^[!1&)&22&!3/4!5./$*$3!"E3)(*!$/!-V!:,#&)0*!!S:/!#()2(/0T!

EU (27 countries)  1999  2000  2001  2002  2003  2004  2005  2006  2007  2008 Morocco  0.8  0.6  0.7  0.7  0.7  0.6  0.8  0.5  0.6  0.5 Tunisia  0.7  0.6  0.6  0.7  0.7  0.7  0.6  0.6  0.6  0.6 

"&.)2(![!-.)&*030U!D303!(P2%.4(*!$/0)3K-V!0)34(!+%&O*U!

1&)&22&!3/4!5./$*$3!E3'(!O(30E()(4!0E(!)(2(/0!*%&O4&O/!$/!-.)&#(!O(%%W!4.(!0&!)(%30$'(%;!$/*.%30(4!+$/3/2$3%!*;*0(,*W!3/!(P2(#0$&/3%!3R)$2.%0.)3%!#)&4.20$&/!3/4!*0)&/R!4&,(*0$2!4(,3/4!$/!788eU!:/!+320W!R)&O0E!322&./0$/R!(P()2$*(*!*.RR(*0*!0E30!4&,(*0$2!4(,3/4!E3*!G(2&,(!3!,&)(!4;/3,$2!*&.)2(!&+!R)&O0E!$/!G&0E!2&./0)$(*!+)&,!788A!&/O3)4*U!p&O('()W!$/2)(3*$/R!2&,#(0$0$'(/(**!3/4!3!+.)0E()!4$'()*$+$230$&/!&+!0)34(!+%&O*!)(#)(*(/0!Q(;!2E3%%(/R(*!0&!*.*03$/!R)&O0E!$/!0E(!+.0.)(U!!

<$R.)(!97!*E&O*!0E(!*E3)(*!&+!0E(!-V!3/4!13RE)(G!$/!(P#&)0*W!$,#&)0*!3/4!0E(!4(*0$/30$&/K*#(2$+$2!2&'()!)30$&!S(P#&)0*!0&!&'()!$,#&)0*!+)&,!3!)(R$&/TU!5E(!+$R.)(!*E&O*!0E30!0)34(!O$0E!&0E()!13RE)(G!2&./0)$(*!$*!,3)R$/3%!+&)!G&0E!1&)&22&!3/4!5./$*$3W!3/4!)(#)(*(/0*!3/!./(P#%&$0(4!#&0(/0$3%W!(*#(2$3%%;!$/!0E(!2&/0(P0!&+!0E(!,&)(!*.G4.(4!R)&O0E!#)&J(20$&/*!+&)!0E(!-.)&#(3/!,3)Q(0U!

<$R.)(!97U!-V!3/4!V1C!"E3)(*!$/!:,#&)0*W!-P#&)0*!3/4!B&'()!b30$&W!788A!S:/!#()2(/0T!

! !

V1C!u!V/$&/!4.!13RE)(G!C)3G(!SC%R()$3W!Y$G;3W!13.)$03/$3W!1&)&22&W!5./$*$3TU!"&.)2([!B&./0);`*!3.0E&)$0$(*!3/4!:1<!*03++!(*0$,30(*U!

V I I . C O N C L USI O N

=(!E3'(!*E&O/!0E30!+&)!G&0E!1&)&22&!3/4!5./$*$3!/&/3R)$2.%0.)3%!cD>!R)&O0E!)30(*!3)(!*$R/$+$23/0%;!$/+%.(/2(4!G;!0E(!'3)$30$&/*!$/!cD>!&+!0E($)!,3$/!-.)&#(3/!#3)0/()*U!p&O('()W!0E(!0)3/*,$**$&/!2E3//(%*!3##(3)!0&!G(!4$++()(/0!G(0O((/!0E(!0O&!2&./0)$(*U!:/!0E(!23*(!&+!5./$*$3W!R)&O0E!*E&2Q*!3)(!,3$/%;!0)3/*,$00(4!0E)&.RE!(P#&)0*!3/4W!0&!3!,.2E!%(**()!(P0(/0W!0&.)$*,U!-P#&)0*W!0&.)$*,!)(2($#0*!3/4!)(,$003/2(*!#%3;!(X.3%%;!$,#&)03/0!)&%(*!$/!1&)&22&U!5E(*(!)(*.%0*!3)(!2&/+$),(4!G;!0E(!('&%.0$&/!&+!(P#&)0W!0&.)$*,W!3/4!)(,$003/2(*!$/!0E(!O3Q(!&+!0E(!)(2(/0!

0

20

40

60

80

100

Exports Imports  Cover 

(a) Morocco

EU UMA

0

20

40

60

80

100

Exports Imports  Cover 

(b) Tunisia

EU  UMA

! 9e!

*%&O4&O/!$/!-.)&#(U!C!*$,$%3)!(P()2$*(!30!0E(!*(20&)3%!%('(%!$/4$230(*!0E30!0E(!*(20&)*!)(%30(4!0&!*()'$2(*!3)(!0E(!,&*0!)(*#&/*$'(!0&!-V`*!cD>!$/!1&)&22&W!OE$%(!$/!5./$*$3!0E(!,&*0!)(*#&/*$'(!*(20&)*!3)(!,&)(!(P#&)0K&)$(/0(4U!!

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! 78!

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c%&G3%!-2&/&,$2!-/'$)&/,(/0!Sc--T!4303!3)(!R)&.#!2&,#&*$0(*W!G3*(4!&/!O($RE0(4!3'()3R(*!&+!*(%(20(4!=&)%4!-2&/&,$2!N.0%&&Q!S=-NT!'3)$3G%(*!+)&,!0E(!2&./0);!4303G3*(*U!5E(!0)34(!O($RE0*!3)(!4()$'(4!+)&,!0E(!:1<`*!D$)(20$&/!&+!5)34(!SDN5T!4303G3*(U!-'();!2&./0);!E3*!+&.)!*(0*!&+!0)34(!O($RE0*W!$U(UW!0E(!$,#&)0*!3/4!(P#&)0*!O($RE0*!+&)!3%%!2&./0)$(*!3*!#3)0/()*W!3/4!0E(!$,#&)0*!3/4!(P#&)0*!O($RE0*!+&)!&/%;!0E(!34'3/2(4!(2&/&,$(*U!5E(!O($RE0*!3)(!23%2.%30(4!+)&,!0E(!c--!)(#&)0$/R!2&./0);`*!0)34(!O$0E!#3)0/()!OE$2E!2&,#)$*(!e\!#()2(/0!&+!0E(!)(#&)0()`*!0&03%!(P#&)0*!&)!$,#&)0*U!5E(!344$0$&/3%!\!#()2(/0!#3)0/()!2&./0)$(*!&+!0E(!)(#&)0()`*!0)34(!4303!4&!/&0!O3))3/0!3/;!$,#)&'(,(/0!$/!0E(!&'()3%%!0)34(!O($RE0*U!5E(!c--!23%2.%30(*!3!)(#&)0$/R!2&./0);k*!*()$(*!/&0!+)&,!0E(!)(#&)0$/R!2&./0);k*!4303!G.0!+)&,!0E(!3RR)(R30(4!*.,!&+!0E(!O($RE0(4!#()2(/03R(!2E3/R(*!&+!$0*!#3)0/()*k!4303!+&)!3!R$'(/!=-N!*()$(*U!

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5E(!3G&'(!03G%(*!*E&O!0E(!c--!O($RE0*!.*(4!+&)!23%2.%30$/R!0E(!2&./0);K*#(2$+$2!2&,#&*$0(!-V!R)&O0E!)30(* S TEU

tg U!C*!O(!O3/0!0&!300)$G.0(!O($RE0*!0&!0E(!cD>!R)&O0E!&+!0E(!-V!2&./0)$(*W!0E(!-V!2&./0)$(*`!O($RE0*!E3'(!G((/!/&),3%$F(4!*.2E!0E30!0E(!*.,!$*!988U!5E(!2&./0);K*#(2$+$2!2&,#&*$0(!cD>!R)&O0E!)30(! S TEU

tg !23/!G(!(P#)(**(4!3*!+&%%&O*W!G3*(4!&/!0E(!O($RE0* it !0E(!-V!

2&./0)$(*!03Q(!$/!1&)&22&`*!3/4!5./$*$3`*!(P#&)0*!&+!R&&4*W!)(*#(20$'(%;W!3/4!&/!0E(*(!2&./0)$(*`!R)&O0E!)30(*!R$[!

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MoroccoFrance 36.36Spain 33.42United Kingdom 8.22Italy 7.87Belgium 5.33Germany 5.20Netherlands  3.60Total 100

TunisiaFrance 42.2Italy 29.1Germany 10.9Spain 7.6Belgium 3.7United Kingdom 3.5Netherlands  2.9Total 100

! 79!

References !C)(FQ$W!bUW!bU!BE()$+W!3/4!HU!>$&0)&O*Q$W!788eW!n5&.)$*,!"#(2$3%$F30$&/!3/4!-2&/&,$2!

D('(%&#,(/0[!-'$4(/2(!+)&,!0E(!VZ-"BN!=&)%4!p()$03R(!Y$*0,” :1<!=&)Q$/R!>3#()!8e?9hg!S=3*E$/R0&/[!:/0()/30$&/3%!1&/(03);!<./4TU!

!L3P0()W!1UW!3/4!1U!_&.#3)$0*3*W!788\W!nD(0(),$/3/0*!&+!L.*$/(**!B;2%(!B&,&'(,(/0[!3!b&G.*0!

C/3%;*$*,”!Journal of Monetary EconomicsW!f&%U!\7S9TW!H3/.3);W!##U99@i\hU!!L3;&.,$W!5U!3/4!CU!"O$*0&/W!788eW!n<&)($R/!-/03/R%(,(/0*]!-*0$,30$/R!0E(!"&.)2(!3/4!"$F(!&+!

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D$*0.)G3/2(*,”!American Economic ReviewW!f&%U!heS^TW!##U!g\\ih@U!!B3/&'3W!<UW!3/4!pU!D(%%3*W!9ee@W!n5)34(!:/0()4(#(/4(/2(!3/4!0E(!:/0()/30$&/3%!L.*$/(**!B;2%(,”!

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=&)Q$/R!>3#()!8e?9\@!S=3*E$/R0&/[!:/0()/30$&/3%!1&/(03);!<./4TU!!:,G*W!H(3/!S788^TW!n5)34(W!<$/3/2(W!"#(2$3%$F30$&/W!3/4!";/2E)&/$F30$&/,”!Review of Economics

and StatisticsW!f&%U!Ag@W!##Uh7@i@^U!!_&*(W!1UCUW!BU!N0)&QW!3/4!BUpU!=E$0(,3/W!788@W!n:/0()/30$&/3%!L.*$/(**!B;2%(*[!=&)%4W!

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!5&.J3*KL()/30MW!H&(%W!L&$%(3.!Y&Q&W!3/4!D&,$/$X.(!"$,3)4W!788eW!n:/'(*0$R30$/R!c)&O0E!

"#$%%&'()*!+)&,!-.)&#(,”!5./$*$3!"(%(20(4!:**.(*!>3#()W!:1<!B&./0);!b(#&)0!!Z&U!98?98eU!!

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