Morocco Set to Receive $1.2 Billion from IMF’s $650 Billion Global Liquidity Boost

Bank Al-Maghrib explains that the SDR allocation is intended to provide liquidity and supplement the official reserves of member countries, as was the case during the global financial crisis in 2009.

The allocation proposal must be approved by the Board of Governors by a majority of 85% of the total voting rights, it adds, stating that it is then distributed to members in proportion to their IMF quotas. Morocco’s quota is 0.19%. As a result, the amount reserved for Morocco is $1.2 billion.

"These SDR allocations, which are recorded in BAM’s external assets but are also accounted for as long-term liabilities, allow the Central Bank to strengthen its reserves, arbitrate them against currencies, and use them to finance its expenditures," he had said following the second quarterly meeting of BAM’s board in 2021.

The voluntary transfer of SDRs from richer to poorer countries is among the avenues explored by the IMF to address economic imbalances. One of the main options would be a transfer of SDRs to the Poverty Reduction and Growth Trust (PRGT) fund, which would increase the supply of loans to low-income countries.

This SDR allocation will feed the foreign exchange reserves, help strengthen confidence in the soundness of the Moroccan monetary ecosystem, said economist Mehdi El Fakir to MAP, adding that it constitutes liaison accounts between central banks internationally and the IMF. The stronger this relationship, the better Morocco’s accessibility to IMF financial support.