Morocco to Phase Out Subsidies on Sugar, Flour, and Butane Gas by 2023

This decision comes on the eve of the departure of the Moroccan government, reports Al Massae, specifying that the process of decompensation of these three products will begin next year. According to the Ministry of Finance, this process is the fulfillment of the gradual reform of the Compensation Fund, in accordance with the provisions of the framework law related to social protection and the guarantee of financing this social reform, mainly the generalization of family allowances.

The process of removing subsidies will begin in 2023 with lump sugar and national soft wheat flour. As for butane gas, 50% of its subsidy will be removed in 2023 and the other half in 2024, the newspaper reports, citing a document presented by the minister and relating to the 2022 Finance Bill in Parliament. Moreover, compensation costs will see an increase of 3.5 billion dirhams in 2022. In addition, civil servant expenses will have to increase by 6.5 billion dirhams, not to mention that the 2022 Finance Bill will also take into account the generalization of social protection, requiring a budget envelope of 8.4 billion dirhams.

Regarding the education and health sectors, an investment of 1.8 billion dirhams is necessary and the improvement of ongoing investment projects will generate additional expenditures of 800 million dirhams, the daily added, specifying that other projects, including economic recovery, strengthening of integration mechanisms and generalization of social protection, strengthening of governance mechanisms and many others, are also priorities of the 2022 Finance Bill.