Moroccan Dirham Gains Against Euro, Slips Versus Dollar Amid Economic Shifts

According to the Treasury General of the Kingdom, the public finances show at the end of August 2020 a decrease in ordinary revenues of 0.1% against an increase in ordinary expenditures of 2.3%. It thus generates a negative ordinary balance of 2.5 billion DH.

Tax revenues have experienced practically the same downward pace as in July, i.e. a rate of 7.7%, standing at 130.5 billion DH at the end of August 2020 against 141.4 billion DH a year earlier. As for domestic taxation, net revenues related to CIT decreased by 0.6% to 28,017 MDH at the end of August 2020 against 28,177 MDH a year earlier.

Non-tax revenues stood at 30 billion DH against 19.2 billion DH a year earlier, up 56.1% or +10.8 billion DH.

At the end of August 2020, the coverage rate of ordinary expenditures by ordinary revenues was 98.4% against 100.8% a year earlier. Thus, at the end of August 2020, 55.4% of these revenues were devoted to personnel expenditures, 25.6% to material expenditures, 14.2% to debt interest and 3.4% to compensation issues.

In terms of expenditure, a global commitment rate of 60% and a disbursement rate on commitments of 86% are noted, compared to 61% and 83% respectively a year earlier.

The total amount of VAT refunds domestically and on imports is 6,103 MDH against 7,412 MDH at the end of August 2019.

Faced with a deterioration of revenues and a surge in expenditures, the budget deficit will continue to deteriorate. In September, tax revenues would further widen if a significant number of companies express interest in benefiting from the exemption of the 3rd CIT account. Recourse to debt is increasingly inevitable for the State to meet its commitments.