Morocco: 2011 Article IV Consultation: Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Morocco

IMF Staff Country Reports, December 2, 2011

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Canonical URL: Morocco: 2011 Article IV Consultation: Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Morocco

Several years of sound macroeconomic policies and political reforms have left Morocco well equipped to address the 2008 international crisis and to respond to pressing social demands.
In the challenging environment following the crisis, Morocco performed well economically and saw its social indicators improve.
Containing and reorienting public expenditure—particularly by reforming the generalized subsidies system—is identified as key to ensuring medium-term fiscal sustainability.
A well-targeted subsidy system would be less costly and would better support the neediest segment of the population.

Morocco’s macroeconomic policy stance and political reforms prior to and during the 2008 international crisis strengthened its capacity to cope with external shocks.
Economic performance and social indicators improved despite the challenging external environment.
The generalized subsidies system represents a major fiscal pressure requiring reform to secure medium-term fiscal sustainability.

Contain public expenditure growth to safeguard fiscal sustainability.
Reorient public spending by reforming the generalized subsidies system.
Implement a well-targeted subsidy system to reduce fiscal cost and better support the neediest population segments.

Subject: Banking, Credit, Expenditure, External debt, Money, Public debt, Revenue administration
Keywords: broad money, CR, Credit, dirham exchange rate, exchange rate, foreign currency, fuel price shock, GDP, Global, ISCR, liability positions vis-à-vis nonresident, Maghreb, money market rate, Morocco, price