The managing director of the IMF visited the North African country to meet the head of the Moroccan government and attend a conference on digital currencies

International Monetary Fund considers Morocco a model of development

AFP/MANDEL NGAN - El sello del Fondo Monetario Internacional (FMI) se ve fuera de un edificio de la sede en Washington, DC
AFP/MANDEL NGAN - The seal of the International Monetary Fund (IMF) is seen outside a headquarters building in Washington, DC

During a meeting between the managing director of the International Monetary Fund (IMF), Kristalina Georgieva, and the head of the Moroccan government, Aziz Akhannouch, Morocco was declared a model in terms of post-COVID crisis management, thanks to specific and time-limited government actions.  

The meeting was held on the sidelines of an official visit to the country to prepare for the next annual meetings of the World Bank Group and the IMF, to be held in Marrakech next October, and to strengthen the existing partnership between the Kingdom and the IMF. 

The Prime Minister expressed, in a press release, disseminated by Maghreb Arab Press, the Kingdom's pride at having been chosen for such a global flagship event, which testifies to the considerable interest that international financial institutions have in Morocco. 

Akhannouch also pointed out that this event provides an opportunity to highlight the important steps taken by his country in the various areas of development under the leadership of King Mohammed VI and to raise awareness of Moroccan civilisation and culture, assuring that Morocco, by hosting this important meeting, represents the entire African continent.

AFP/IAN FOSYTH - Aziz Akhannouch, primer ministro de Marruecos
AFP/IAN FOSYTH - Aziz Akhannouch, prime minister of Morocco

In addition, the head of government reviewed the main lines of government action, which revolve mainly around economic recovery, the generalisation of social protection, tax reform, public sector reform and financial sector reform. 

Akhannouch also recalled the main fundamentals of the Alawi kingdom's economic and social policy, as well as its commitment to continue its action to improve macroeconomic balance and ensure the optimal implementation of the country's major development strategies in the different sectors. 

The Finance Law for 2023 reflects this approach by including the consolidation of the foundations of the social state desired by the sovereign, promoting investment, addressing the problem of water management and providing the necessary resources to ensure the sustainability of reforms.

PHOTO/FILE - La directora gerente del Fondo Monetario Internacional (FMI), Kristalina Georgieva
PHOTO/FILE - The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, is the first woman to be elected to the IMF's Executive Board

IMF visit to Rabat

Separately, Georgieva reported earlier today that the IMF is actively developing a central bank digital currency platform (CBDC) to facilitate cross-border transactions.  

As Reuters reports, speaking at a conference attended by African central banks in Rabat, Georgieva stressed the importance of connectivity and interoperability between countries to ensure more efficient and equitable transactions. 

Georgieva stated: "CBDCs should not be limited to national borders. To achieve greater efficiency and fairness, we need systems that connect countries; we need interoperability". She stressed the IMF's commitment to create a global CBDC platform to address this need. 

The IMF urges central banks to establish a unified regulatory framework for digital currencies that promotes global interoperability. Failure to reach consensus on a common platform could create a vacuum that cryptocurrencies could fill, she warned.

PHOTO/FILE - Logo del Banco Mundial
PHOTO/FILE - World Bank logo

CBDCs differ from cryptocurrencies in that they are controlled by central banks and operate within a centralised system. The IMF initiative aims to harness the potential of CBDCs for international transactions, fostering financial inclusion and reducing the cost of remittances. Georgieva noted that the average cost of money transfers currently stands at 6.3%, or a total of $44 billion per year. 

The director stressed the importance of backing CBDCs with physical assets. She acknowledged that cryptocurrencies can present investment opportunities when backed, but warned that they become speculative investments when they are not.

Georgieva also revealed that 114 central banks are currently considering CBDCs and about 10 are already in advanced stages of development. She expressed concern that the limited national deployment of CBDCs underutilises their potential. 

The IMF's efforts to establish a global CBDC platform reflect the growing interest in and recognition of digital currencies as a crucial aspect of the future financial landscape.