Finances News Hebdo: The Moroccan economy is going through a difficult period marked by drought and an unfavorable international situation accentuated by the war in Ukraine. What is your reading of the situation?
Mohamed Amrani: After the pandemic, the start of a recovery in the international and also Moroccan economy was recorded, but it was quickly disrupted by the obstacles you mentioned. Faced with this situation, Morocco was forced to revise its forecasts significantly downwards. Under the 2022 Finance Law, the growth rate was set at 3.2%, but it was recently set at 1.5%. However, if the unfavorable elements should be accentuated, in particular the upheavals of the drought, it is very likely that it will be reduced once more. The rise in the cost of imports, in particular the energy and grain bill, has seriously impacted producer and consumer prices. Imported inflation presents significant threats to the domestic economy. Fortunately, certain sectors such as phosphates, the automobile industry or transfers from MREs have performed well, allowing to cushion somewhat the vagaries of this situation. Other activities such as tourism, transport or trade have in turn experienced some recovery. Despite this, the Moroccan economy remains intimately linked to the development of agriculture. The next season will be decisive. Another year of drought will be synonymous with disaster, especially since the water reserves of the dams have recorded a historic drop and many structures are close to drying up.
FNH: What regarding the effect of inflation?
M. A. : The inflation rate has reached a worrying level. It is part of an exponential movement, presenting serious risks not only of an economic order, but also and above all social. It directly impacts the purchasing power of citizens, especially those with limited income. The phenomenon is almost generalized in the world, prompting all countries to take drastic measures to control it or mitigate its effect. Morocco has thus taken certain measures, including the allocation of an exceptional subsidy for the transport sector and a new budget extension for the Compensation Fund. On the monetary front, Bank Al-Maghrib raised its rate director. However, these measures are insufficient to deal with it because in this period of crisis, reforms must be accelerated.
FNH: In these restrictive conditions, how do you judge the evolution of the Dirham?
M. A. : During the pandemic and also the period that followed, the Dirham has shown itself to be somewhat resilient. It was little impacted compared to certain economies such as those of Tunisia, Algeria or Turkey. Like the country’s economy, the national currency withstood the vagaries of the economic situation, supported by the large volume of foreign currency reserves thanks in particular to record transfers from Moroccans living abroad and sales of phosphates. The semi-flexibility policy adopted by the monetary authorities has shown its relevance. It should also be emphasized that, recently, the Dirham has started to depreciate, especially once morest the Dollar, under the effect of massive imports.
FNH: The government should present its 2023 Finance Bill no later than October 20. What are the elements on which he must capitalize to deal with this situation?
M. A. : The finance bill 2023 should continue to support the national economy, further control inflationary pressures and, at the same time, maintain public investment. On the tax front, the government has announced a reduction in income tax (IR). This measure is a breath of fresh air for households, particularly the middle class. At the social level, it should complete the project for the generalization of compulsory health insurance (AMO) and implement the unified social register. To finance all its programs, the State will need significant financial resources. It is a very difficult equation to solve, but it has several leeway. To achieve this, it is imperative that it reduce its expenses, in particular operating expenses, such as the budgets allocated for rolling stock, travel and festivities.