The Minister of Economy has warned that the measures taken to reduce the spread of COVID-19 have led the Kingdom of Alaoui to suffer one of the "worst crises" in recent years

Marruecos prevé superar la crisis económica provocada por el coronavirus en menos de dos años

AFP/FADEL SENNA - Moroccan Parliament during a parliamentary session

The crisis caused by the coronavirus pandemic has put the economies of hundreds of countries on the ropes, including Morocco, which plans to fully recover from this recession by 2022. This was announced by the Minister of Economy, Finance and Administrative Reform of the Kingdom of Morocco on Wednesday during a press conference after the Governing Council. The measures taken to reduce the spread of this pathogen, the drought that has hit the country and the inevitable contraction of the economy have led Morocco to suffer one of the worst crises in recent years. "The growth rate of the Moroccan economy will register a deflation of around 5%, for the first time since the end of the 1990s, while macroeconomic balances will be severely affected, in particular as regards the budget deficit and the balance of payments current account," the minister said. 

The Minister of Economy, Mohammed Benchaaboun, explained that although the national economy will suffer three shocks caused by the strong deflation of the world economy, the country will begin to recover during the second half of this year, although full recovery will not come until 2022. During the Governing Council, Benchaaboun presented a report analysing the economic situation of the North African nation until June. 

At this meeting, the Moroccan executive also examined the prospects for recovery by the end of 2020 and announced its intention to donate one fifth of its salaries, from August until the end of this year, to the special fund designed to address the COVID-19. "This donation is a contribution by members of the government to the efforts made to tackle this pandemic which requires greater mobilization and commitment in order to mitigate its economic and social impact," stressed the Minister Delegate in charge of Higher Education and Scientific Research, Driss Ouaouicha.

With regard to foreign trade, Benchaaboun noted that the trade deficit improved at the end of July. However - according to the minister - remittances from Moroccans living abroad and income from tourism and foreign investment "experienced a clear contraction", according to statements collected by the news agency MAP. He also explained that, despite this reduction, "foreign exchange reserves have improved thanks to the mobilisation of foreign financing, at a time when the market stabilised without any intervention by Bank Al Maghrib". 

The Minister for the Economy, Finance and Administrative Reform also made his predictions during this meeting and pointed out that "the balance of payments current account deficit at the end of 2020 is likely to reach 8% of GDP". Public finances, for their part, depend on the law that deals with this issue which has shown in recent months "a clear decrease in fiscal resources in comparison with preliminary estimates, whilst spending is at the same level as estimates, thanks to the measures taken to support the national economy". After analyzing these data, the head of the Economy area in the Government of Morocco has concluded that, in view of these data, "the budget deficit would be at 7.5% and the debt rate at 75.5% of GDP". Even so, he has been clear in his final message, admitting that all these estimates depend on the risks associated with the COVID-19 pandemic, which has left 18,264 infected and more than 290 dead in this country. 

Morocco has been trying to help those most disadvantaged by the current health crisis since the beginning of this pandemic. In March, for example, the government announced the delivery of monthly direct aid to the poorest households, many of which are dependent on the informal sector economy. In addition, King Mohammed VI launched a special fund to combat the consequences of this disease.