This month, Moroccans voted for their local and regional authorities who will elect a new House of Councillors on 2 October. The elections resulted in a mixed outcome for the parties governing parliament. In regional elections, the liberal opposition Parti authenticité et modernité (PAM) took five regions while the governing coalition Parti de la Justice et du Développement (PJD) and Rassemblement National des Indépendants (RNI) each took two of Morocco’s 12 regions. The PAM took the most votes in local elections, largely due to its focus on rural constituencies. The PJD, ranked third, tripled their number of local council seats, taking control of all of Morocco's major cities.

Impact on country risk

The elections have reinforced the popularity of the Islamist PJD and its leader, Prime Minister Abdelilah Benkirane. However, they have cast doubt on the long-term survival of the ruling PJD-RNI coalition which faces parliamentary polls in November 2016. Although the formation of a new coalition is likely after parliamentary elections, as King Mohammed VI is the ultimate decider of policy, changes to the government coalition are unlikely to significantly affect policy direction or the business environment. Indeed, Prime Minister Abdelilah Benkirane's scope of action is constrained by the realities of the coalition government in Morocco. At every level of government, most particularly in the cabinet, powerful pro-palace figures are present, limiting the governing party's scope of action in the more radical aspects of its policy. Nevertheless, there has been an improvement in comparison to the reign of the previous king, Hassan II, who almost had complete control over the political process and policy direction. Analyst: Jolyn Debuysscher, j.debuysscher@credendogroup.com