Moroccan Black Market Currency Trading Surges Amid COVID-19 Economic Downturn

The euro in particular has seen an increase in demand in recent months, reports the daily Assabah. This situation is explained by a drop in the value of the dirham against the euro and by the safe haven value that this currency represents for some wealthy people and businessmen during the Covid-19 pandemic.

According to the same daily, this increase is also justified by the mobilization of certain families who come to the aid of their relatives stranded in foreign countries. As for the accredited exchange companies, they have made significant increases in the exchange rate, "largely higher than those practiced by banks".

According to the same source, the euro is currently worth more than 12 dirhams in some exchange companies, while in banks it does not exceed 11.60 dirhams. Thanks to the profit margin estimated at 40 cents for each euro bought, the exchange-related transactions exceeded 16 billion dirhams, an increase of 9 billion dirhams compared to some 7 billion dirhams per month in April.

As a result, Morocco’s foreign exchange reserves, which do not exceed 218 billion dirhams, have recorded a record decline, representing a coverage rate of barely 5 months of the country’s foreign exchange needs. To limit the damage, the authorities are multiplying investigations to identify the networks behind this trafficking and the amounts exchanged. Due to some 8 billion dirhams suspected of having been exchanged outside legal channels, these investigations are being conducted jointly with the Foreign Exchange Office and Bank Al-Maghrib.