The role of government — practice question

Study the source material thoroughly before you answer Question 1. Source Material: Morocco’s blue economy The World Bank says a ‘blue economy’ is one that makes sustainable use of ocean resources to drive economic growth and to create jobs that raise people’s living standards. Using the blue economy to the full could lower poverty levels among fishermen. Across the world, many fishermen remain poor because pay is low and unemployment is both seasonal and structural. Morocco is Africa’s main supplier of fish. Even with its long coastline, the fishing industry now adds only a very small amount to Morocco’s GDP. The government therefore wants the industry to expand further. Policy measures such as subsidies for fishermen could enable Moroccan fishermen to raise productivity and cut competition from overseas. The United Nations’ Food and Agricultural Organisation (FAO) predicts that Moroccan fisheries’ output could increase to almost 2 million tonnes of fish each year by 2030. Worldwide demand for fish is also rising sharply as more people view fish as healthier than meat. Growth of this kind could help to shrink Morocco’s current account deficit in its balance of payments. A greater reliance on the primary sector may not raise living standards in Morocco because some other countries that have pursued the same route have produced disappointing results. Fig. 1.1 shows the GDP per head ($) and percentage (%) contribution of the primary sector to GDP of selected countries. Environmentalists are concerned that fishing in Morocco is not properly regulated. If overfishing takes place, fish stocks would fall for future generations. However, if fish stocks are preserved, the economy can keep its rapid economic growth rate. At a time when African countries are reducing trade protection, a sustainable fishing industry could be very beneficial for Morocco’s future.