IMF to Boost Morocco’s Foreign Reserves with $1.2 Billion Aid Package

At the beginning of August, the IMF Board of Governors agreed to allocate a general allocation of Special Drawing Rights of $650 billion to its member countries in order to increase liquidity in this crisis period. Morocco, an IMF member country with a quota of 0.19%, will receive $1.2 billion, or 10.5 billion dirhams. This allocation will allow Morocco to strengthen its foreign exchange reserves to a comfortable level of 328.5 billion dirhams by the end of 2021, according to the forecasts of the Central Bank, reports Le360.

With this amount, the Moroccan monetary authorities will be able to finance the recovery of the national economy in this difficult context. "This is a historic decision: the largest SDR allocation in IMF history and a lifeline for the global economy in this unprecedented crisis. This SDR allocation will benefit all member countries, meet the global long-term reserve need, boost confidence and enhance the resilience and stability of the global economy," said Kristalina Georgieva, the IMF’s Managing Director.

The SDR is not a debt but an allocation to strengthen the country’s official reserve assets, through the corresponding increase in its SDR holdings. In exchange, the sum of the SDRs is recorded on the liability side of the central bank’s balance sheet as a commitment to the IMF. For the record, these allocations are rarely granted. Since 1972, they have been granted only three times.