Morocco’s Public Debt Soars to 91.7% of GDP Amid Pandemic Budget Strain

A deficit of 25.5 billion dirhams was recorded in the execution of the budget at the end of the first five months, compared to 19.5 billion a year earlier, due to the positive balance of 18.1 billion of the new special allocation account for the management of the coronavirus pandemic.

Ordinary revenues fell by 10%, particularly impacted by the decline in tax revenues, according to the information elements presented by Abdellatif Jouahri, Wali of Bank Al Maghrib (BAM). As for total expenditure, it recorded an increase of 4%, which essentially reflects increases of 10.8% in the wage bill and 18.3% in charges for other goods and services, while investment expenditure recorded a decrease of 11.3%.

The cash deficit stands at 25.1 billion dirhams against 25.7 billion a year earlier. As for the indebtedness of the Treasury, it would increase, going from 65% of GDP to 75.3% in 2020 and to 75.4% in 2021. Its domestic component would see an increase from 50.9% of GDP in 2019 to 57.7% in 2020, before returning to 56.7% in 2021. The external debt of the Treasury, for its part, should go from 14% of GDP in 2019 to 17.6% in 2020 and to 18.6% in 2021. Consequently, the ratio of total public debt should increase from 80.5% of GDP in 2019 to 91.7% in 2020, before experiencing a slight decline (91.1% of GDP in 2021).