The Moroccan kingdom has asked the International Monetary Fund for a two-year loan to support its economy

Marruecos solicita un pr茅stamo de 5.000 millones de d贸lares al FMI

photo_camera REUTERS/JOHANNES P. CHRISTO - IMF

The International Monetary Fund (IMF) has agreed to a credit line for a total amount of $5 billion for Morocco for a period of two years. The agreement was signed by the Moroccan Ministry of Finance and IMF Managing Director Kristalina Georgieva. The loan will be provided to help Morocco cope with the economic effects. The IMF said the loan will have "very flexible" conditions, including a very low interest rate and a duration of two years, and that the loan will be provided within a framework of fiscal adjustment with the objective of reducing Morocco's fiscal deficit and restoring debt sustainability.  

The IMF executive board received a request from the Moroccan authorities for two long-term arrangements under the Flexible Credit Line (FCL). The board discussed the feasibility of the arrangements and the potential support that the IMF could provide to the country. A number of issues were discussed, including the level of debt, the fiscal situation and macroeconomic stability. The IMF Board also discussed the structural reforms that the Moroccan government is undertaking to improve long-term economic stability and pledged to continue working with the Moroccan authorities to help the country achieve its growth and development goals.  

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The Moroccan government requested a line of credit worth $5 billion, equivalent to more than 51 billion Moroccan dirhams. This corresponds to 3.726 billion Development Finance Corporation (DFC), approximately 417% of Morocco's share. 

This credit line offers the flexibility of a precautionary line without the requirements of ex-post conditionality. This means that countries using this credit line do not have to comply with IMF requirements to gain access to resources. This flexibility allows countries to maintain independence in their policy decisions. At the same time, the IMF incentivises countries to adopt responsible policies by offering a credit line with a longer term, lower interest rates and a larger amount of resources, it also helps countries stabilise their economies through the prevention of external shocks, allowing them to avoid a financial crisis.

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Kristalina Georgieva noted that the IMF has closely followed Morocco's economic developments over the past year and is satisfied with the country's fiscal and monetary track record, as well as recognising Morocco's efforts to strengthen its banking and financial institutions and the fiscal responsibility demonstrated by the government. In addition to Morocco's efforts to strengthen its economy, the IMF has also highlighted the country's political and social stability. The reforms implemented by the government have helped to improve human rights and reduce poverty in the Kingdom. As such, the IMF is satisfied with Morocco's economic policy frameworks and believes that the North African country is a good candidate for the Flexible Credit Line arrangement. The agreement is expected to help strengthen Morocco's economy and improve the country's macroeconomic stability.  

The agreement is expected to enable Morocco to meet the challenges of economic growth, job creation and poverty reduction. The IMF has agreed to a structural reform programme that includes measures to improve employment and economic growth, strengthen private and financial sector participation and improve competitiveness. 

Hoping that the loan will help stabilise the North African country's economy, the IMF has said it is committed to working with the country to ensure growth and improve the quality of life of its citizens. Morocco's government has pledged to use the funds to improve its infrastructure, modernise its financial sector and increase investment in education and health. 

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