IMF Forecasts 4.5% Economic Growth for Morocco in 2021 as Pandemic Impact Wanes

Roberto Cardarelli, speaking at a press conference devoted to the presentation of the conclusions of his consultations with the Moroccan authorities, under Article IV of the IMF, indicated that in 2020, GDP should contract around a range of 6 to 7%, depending on the evolution of the Covid-19 pandemic, and the unemployment rate should increase sharply.

The IMF representative noted that "the budget and external deficits should widen, due to the decline in tax revenues and the decline in foreign exchange earnings from tourism, respectively," adding that the resilience of remittances from Moroccans residing abroad and the decline in imports have limited Morocco’s external financing needs.

According to Roberto Cardarelli’s conclusions, international reserves remain well above their level last year, thanks in particular to the drawing under the IMF’s Precautionary and Liquidity Line in April last (Press Release No. 20/138) and the intensification of efforts to mobilize external financing.

In addition, Mr. Cardarelli stressed the fundamental role played by "the generous contributions of the public and private sectors to the Special Fund for the Management of the Pandemic". These contributions have mainly enabled the financing of measures that have supported domestic demand and the most vulnerable groups of the population. All of which would allow "a gradual, progressive budgetary rebalancing process that should be undertaken when the economic recovery is solid," he concluded.