{
  "title": "IMF Executive Board Concludes 2017 Article IV Consultation with Morocco",
  "publication": "IMF News, December 14, 2017",
  "sourceUrl": "https://www.imf.org/en/news/articles/2017/12/14/pr17497-imf-executive-board-concludes-2017-article-iv-consultation-with-morocco",
  "canonical": "https://www.imf.org/en/news/articles/2017/12/14/pr17497-imf-executive-board-concludes-2017-article-iv-consultation-with-morocco",
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  "summary": "Real GDP growth:",
  "publishDate": "2017-12-14",
  "sections": [
    {
      "heading": "Macroeconomic performance and outlook",
      "content": "- Real GDP growth:\n  - 2016: 1.2\n  - 2017 (expected): 4.4 percent\n  - Medium-term: growth expected to reach 4.5 percent by 2021\n- Growth drivers:\n  - 2017 pickup mostly driven by a significant rebound in agricultural activity; non-agricultural activity remains subdued\n  - Exports growth (2017): 6.5 percent, driven by food product and phosphate and derivatives exports\n- Inflation:\n  - Headline inflation (year-on-year) expected to decline to 0.6 percent in 2017, reflecting lower food prices\n  - Consumer prices (end of period): 2016: 1.8; 2017: 0.9\n  - Consumer prices (period average): 2013: 1.9; 2014: 1.5; 2015: 1.3\n- Unemployment:\n  - Unemployment rate increased to 10.6 percent in Q3 2017 (year-on-year)\n  - Youth unemployment: 29.3 percent"
    },
    {
      "heading": "External sector and reserves",
      "content": "- Current account:\n  - Current account deficit projected to improve in 2017 to 3.9 percent of GDP\n  - Current account excluding official transfers (selected years): 2013: -8.3; 2014: -7.6; 2015: -2.6; 2016: -5.3; 2017: -4.3\n  - Current account including official transfers (selected years): 2013: -5.9; 2014: -2.1; 2015: -4.4; 2016: -3.9; 2017: -3.7\n- Trade and reserves:\n  - Exports of goods and services (U.S. dollars, percentage change): 2013: 7.4; 2014: -7.0; 2015: 6.5; 2016: 7.2\n  - Imports of goods and services (U.S. dollars, percentage change): 2013: 1.0; 2014: -16.5; 2015: 9.6; 2016: 5.3\n  - Merchandise trade balance (percent of GDP): 2013: -20.5; 2014: -18.7; 2015: -14.5; 2016: -17.1; 2017: -16.4; 2018: -16.0\n  - Gross reserves (in billions of U.S. dollars): 2013: 19.0; 2014: 20.5; 2015: 23.0; 2016: 25.4; 2017: 24.8; 2018: 27.6\n  - Reserves in months of next year imports of goods and services (selected years): 2013: 4.6; 2014: 6.1; 2015: 6.4; 2016: 5.9; 2017: (about) six months of imports noted in text\n  - In percent of Fund reserve adequacy metric (selected years): 2013: 74.3; 2014: 79.9; 2015: 94.7; 2016: 99.3; 2017: 90.3; 2018: 93.8\n- Net imports of energy products (in billions of U.S. dollars): 2013: -12.2; 2014: -11.0; 2015: -6.8; 2016: -5.5; 2017: -7.3"
    },
    {
      "heading": "Fiscal developments",
      "content": "- Fiscal consolidation:\n  - Resumption of fiscal consolidation noted; developments as of end-October 2017 were broadly positive\n  - Tax revenues performed better than projected; grant revenues were lower than anticipated\n  - Public spending on wages and interest payments was below expectations; capital expenditures decelerated by 2 percent year-on-year\n- Fiscal aggregates (selected years, percent of GDP):\n  - Revenue (2015–2017 series shown): 27.8; 26.5; 26.1\n  - Expenditure (2015–2017 series shown): 32.9; 30.7; 30.2\n  - Budget balance: 2013: -5.1; 2014: -4.8; 2015: -4.2; 2016: -4.1; 2017: -3.5; 2018: -3.0\n  - Primary balance (excluding grants): 2013: -3.2; 2014: -3.6; 2015: -1.9; 2016: -2.4; 2017: -1.3\n  - Cyclically-adjusted primary balance (excl. grants): 2013: -2.9; 2014: -1.6; 2015: -1.8; 2016: -1.2\n  - Total government debt: 2013: 61.7; 2014: 63.3; 2015: 63.7; 2016: 64.7; 2017: 64.3; 2018: 64.0"
    },
    {
      "heading": "Financial sector",
      "content": "- Banking sector:\n  - Banks are well capitalized; risks to financial stability are limited\n  - Nonperforming loans remain relatively high but are closely monitored and well provisioned\n  - Regulatory limits to reduce credit concentration are being strengthened\n  - Collaboration with cross-border supervisory bodies to contain risks related to Moroccan banks’ expansion in Africa is being strengthened\n- Monetary indicators (selected annual percentage change):\n  - Credit to the economy: 2013: 3.8; 2014: 2.5; 2015: 2.0; 2016: 4.3; 2017: 5.7\n  - Base money: 2013: 9.0; 2014: 6.2; 2015: 5.0; 2016: 6.0\n  - Velocity of broad money (2013): 0.8"
    },
    {
      "heading": "Risks and structural reform priorities",
      "content": "- Main risks highlighted:\n  - Growth risks in advanced and emerging countries\n  - Geopolitical tensions in the region\n  - World energy prices\n  - Global financial market volatility\n- Structural reforms needed to sustain stronger medium-term growth and inclusiveness:\n  - Labor market efficiency reforms\n  - Improved access to finance\n  - Quality of education improvements\n  - Enhanced public spending efficiency\n  - Further improvements to the business environment\n  - Strengthening the social safety nets system to achieve more inclusive growth\n- Directors’ recommendations and assessments:\n  - Maintain sound fiscal and monetary policies and step up structural reform efforts, supported by measures to strengthen the social safety net\n  - Continue fiscal consolidation and control spending on wages and goods and services to create fiscal space for priority spending in the medium term\n  - Implement comprehensive tax reforms to broaden the tax base and promote greater equity and simplicity\n  - Carefully implement fiscal decentralization and comprehensive civil service reform\n  - Strengthen state‑owned enterprise (SOE) oversight and improve targeting of social spending to protect vulnerable segments\n  - Move to a more flexible exchange rate regime and a new monetary policy framework to help absorb external shocks and remain competitive\n  - Bank Al Maghrib to increase supervisory capacity in line with 2015 Financial Sector Assessment Program recommendations, including more risk‑based and forward looking supervision and tighter provisioning requirements\n  - Sustain implementation of broad‑based structural reforms, including better governance, improved education and vocational training, to reduce unemployment (especially youth) and increase women's participation in the labor force\n  - Progress in implementing the national strategy against corruption and in making the Competition Council operational was encouraged"
    },
    {
      "heading": "Selected economic indicators (2013–18) — key series (annual percentage change or percent of GDP as presented)",
      "content": "- Output and Prices:\n  - Real GDP: 2013: 4.5; 2014: 2.7; 2015: 1.2; 2016: 4.4; 2017: 3.1; 2018: …\n  - Real agriculture GDP: 2013: 17.2; 2014: -2.2; 2015: 11.9; 2016: -12.8; 2017: 15.2; 2018: -1.0\n  - Real non-agriculture GDP: 2013: 2.9; 2014: 3.4; 2015: 3.7; 2016: 3.0; 2017: 3.6\n- Investment and Saving (percent of GDP):\n  - Gross capital formation: 2013: 34.7; 2014: 32.5; 2015: 30.8; 2016: 32.6; 2017: 33.4; 2018: 34.5\n  - Nongovernment (of gross capital formation): 2013: 29.6; 2014: 27.2; 2015: 25.3; 2016: 26.9; 2017: 28.0; 2018: 29.0\n  - Gross national savings: 2013: 27.1; 2014: 26.6; 2015: 28.7; 2016: 28.2; 2017: 29.5; 2018: 25.6\n- External Sector:\n  - Foreign direct investment (percent of GDP): 2013: 2.8; 2014: 2.6; 2015: 2.4\n  - Total external debt (percent of GDP): 2013: 29.3; 2014: 33.3; 2015: 33.9; 2016: 34.6; 2017: 33.5\n- Memorandum items:\n  - Nominal GDP (in billions of U.S. dollars): 2013: 106.8; 2014: 110.1; 2015: 101.2; 2016: 103.6; 2017: 110.0; 2018: 117.6\n  - Unemployment rate (in percent): 2013: 9.2; 2014: 9.9; 2015: 9.7; 2016: 9.4\n  - Population (millions): 2013: 33.8; 2014: 34.1; 2016: 35.2\n  - Population growth (in percent): 2013: 1.21; 2014: 1.17; 2015: 1.05; 2016: 1.06\n  - Local currency per U.S. dollar (period average): 2013: 8.4; 2014: 9.8\n  - Real effective exchange rate (annual average, percentage change): 2013: 0.0; 2014: 0.3; 2015: 2.3\n\nSource: IMF Executive Board Concludes 2017 Article IV Consultation with Morocco (Press Release No. 17/497), December 14, 2017.\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- Morocco and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.imf.org/external/np/sec/m/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2017/12/14/pr17497-imf-executive-board-concludes-2017-article-iv-consultation-with-morocco"
    }
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    "Published: December 14, 2017",
    "Real GDP growth:",
    "Growth drivers:",
    "Inflation:",
    "Unemployment:",
    "Current account:",
    "Trade and reserves:",
    "Net imports of energy products (in billions of U.S. dollars): 2013: -12.2; 2014: -11.0; 2015: -6.8; 2016: -5.5; 2017: -7.3",
    "Fiscal consolidation:",
    "Fiscal aggregates (selected years, percent of GDP):",
    "Banking sector:",
    "Monetary indicators (selected annual percentage change):",
    "Main risks highlighted:",
    "Structural reforms needed to sustain stronger medium-term growth and inclusiveness:",
    "Directors’ recommendations and assessments:",
    "Output and Prices:",
    "Investment and Saving (percent of GDP):",
    "External Sector:",
    "Memorandum items:",
    "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)",
    "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)",
    "[Morocco and the IMF](http://www.imf.org/external/country/MAR/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[http://www.imf.org/external/np/sec/m/qualifiers.htm](http://www.imf.org/external/np/sec/m/qualifiers.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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