Prospect analysis of inter-sectoral Water Reallocation in the Moroccan economy

With the continuous socioeconomic development of Morocco, water resources are being depleted rapidly whereas water demand is largely increasing. This situation has led to a structural unbalance in water resources budget with a continuous trend to worsen over time. Questions have arisen about how water should be allocated and which criteria should be applied to ensure not only social equity but also economic efficiency. The present study has been triggered by this situation. This paper reports the results of an empirical application using an Input-Output model for Morocco together with data on water consumption by sectors. The goal is to firstly analyze how water is reallocated within nineteen sectors in response to an increase of one monetary unit in final demand and secondly enable its variation effect through layers of a decomposition process (donor or receiver). From the reallocation matrix, exogenous inflows profit trade (sector 1) and damage agriculture, forestry and related services (sector 1). In addition, decomposition of water distribution matrix through layers confirmed that 21% of sectors changed effects from receivers to donors and vice versa starting from the second layer. The results provide a wealth of information for requesting strategies that aimed to reduce pressure on water resources, e.g. design measures to preserve water in an economy.