April 2, 2025
PRESS OFFICER:
Phone: +1 202 623-7100Email: MEDIA@IMF.org
Washington, DC: The Executive Board of the International Monetary Fund (IMF) approved today a new successor two-year arrangement for Morocco under the Flexible Credit Line (FCL) in an amount equivalent to SDR 3.45 billion (about US$ 4.5 billion, equivalent to 386 percent of quota), and noted the cancelation by Morocco of the previous FCL arrangement. The Moroccan authorities stated their intention to treat the new arrangement as precautionary.
This is Morocco’s second FCL, with lower access in line with the authorities’ goal of continuing to reduce access as risks permit in the context of their gradual exit strategy. The first FCL was approved on April 3, 2023 in an amount of SDR 3.7262 billion (equivalent to 417 percent of quota) (see Press Release No. 23/104 ). Before the first FCL, Morocco had also benefited from four successive Precautionary and Liquidity Line (PLL) arrangements between 2012-2020 (see Press Release No. 12/287 , Press Release No. 14/368 , Press Release No. 16/355 , Press Release No. 18/477 ).
Following the Executive Board’s discussion on Morocco, Mr. Kenji Okamura, Deputy Managing Director, and Acting Chair, said:
“The Moroccan economy has shown sustained track record of implementing very strong policies and remarkable resilience to recent shocks, although a succession of droughts has severely curtailed agricultural production and pushed unemployment to historical highs.
“Morocco's very strong institutional and policy frameworks have been effective in addressing these shocks, with well-calibrated fiscal, monetary, and financial policies. The recent bond issuance in the international capital markets at very favorable terms is a testament of the authorities’ very strong track record. Looking ahead, the authorities are committed to continuing to implement their ambitious structural reform agenda towards a more resilient, inclusive, greener, and private sector-led growth, and further strengthening their institutional policy frameworks. The new FCL arrangement will continue to be instrumental in supporting Morocco’s commitment to such strong policies and reforms.
“The new FCL arrangement will also continue to provide Morocco insurance against downside risks. The Moroccan economy remains vulnerable to a worsening of global economic and financial conditions, higher commodity prices, and new occurrence of droughts.
“The authorities are committed to treating the new FCL arrangement as precautionary and gradually reducing access, in the context of their exit strategy, contingent on the evolution of risks.”
ANNEX
Recent Economic Developments
Morocco’s economy has demonstrated resilience in the face of multiple shocks. In recent years, Morocco navigated the global pandemic, the economic fallout from Russia’s invasion of Ukraine, a devastating earthquake in 2023, and five droughts in six years. While these shocks have weighed on economic activity and the successive droughts have curtailed agricultural production and pushed unemployment to historical highs, the authorities managed to preserve macroeconomic stability through effective fiscal, monetary, and financial policy responses. They also continued to implement important structural reforms to achieve Morocco’s new model of development, aimed at stronger, greener, more resilient and inclusive growth. Medium-term growth is projected at 3.6 percent, supported by planned infrastructure projects and progress in structural reforms.
However, Morocco remains highly exposed to elevated uncertainty and external risks, and policy space remains limited relative to what would be needed to mitigate the economic impact if external risks were to materialize. At the same time, the risk of severe droughts continues to imperil the agricultural sector—with large weight in Morocco’s economy—as the authorities work on addressing the country’s water scarcity.
Arrangement Summary
The IMF approved today a successor two-year arrangement for Morocco under the Flexible Credit Line (FCL), designed for crisis prevention and mitigation, of about US$ 4.5 billion. Morocco qualifies for the FCL by virtue of its very strong institutional policy frameworks and economic fundamentals, its track record of implementing very strong policies, and its continued commitment to maintaining such policies in the future. The authorities consider that the FCL arrangement has served the country well and remains the most appropriate tool to help them continue to rebuild buffers while accelerating the implementation of structural reforms in a highly uncertain external environment.
| Morocco: Selected Economic Indicators, 2020-30 | |||||||||||
| Population: 36.8 million; 2024 | Per capita GDP: $3,817; 2023 | ||||||||||
| Quota: SDR 894.4 million | Poverty rate: 4.8 percent; 2013 | ||||||||||
| Main exports: automobiles, phosphate and derivatives; 2023 | |||||||||||
| Key export markets: France and Spain (42% of total trade); 2023 | |||||||||||
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 | |
| Proj. | |||||||||||
| Output (annual percent change) | |||||||||||
| Real GDP growth | -7.2 | 8.2 | 1.5 | 3.4 | 3.2 | 3.9 | 3.7 | 3.6 | 3.6 | 3.6 | 3.6 |
| Real nonagricultural GDP growth | -7.2 | 7 | 3.2 | 3.6 | 4.1 | 3.7 | 3.7 | 3.7 | 3.7 | 3.7 | 3.7 |
| Employment (percent) | |||||||||||
| Unemployment | 11.9 | 12.3 | 11.8 | 13 | 13.3 | 13.2 | 12.9 | 12.4 | 12.1 | 11.9 | 11.8 |
| Prices | |||||||||||
| Inflation (end of period) | -0.3 | 3.2 | 8.3 | 3.4 | 0.7 | 2.1 | 2.2 | 2.2 | 2.1 | 2 | 2 |
| Inflation (period average) | 0.7 | 1.4 | 6.6 | 6.1 | 0.9 | 2.2 | 2.3 | 2.2 | 2.1 | 2 | 2 |
| Central government finances (percent of GDP) 1/ | |||||||||||
| Revenue | 27 | 25.1 | 28.4 | 27.9 | 30.1 | 30.4 | 29.4 | 28.1 | 28.1 | 28.1 | 28.1 |
| Expenditure | 34.1 | 31 | 33.8 | 32.3 | 34.2 | 34.3 | 32.8 | 31.4 | 31.3 | 31.2 | 31.2 |
| Fiscal balance | -7.1 | -5.9 | -5.4 | -4.5 | -4.1 | -3.9 | -3.4 | -3.3 | -3.2 | -3.1 | -3.1 |
| Public debt | 72.2 | 69.4 | 71.5 | 69.5 | 70 | 68.9 | 67.7 | 66.8 | 66.2 | 65.6 | 65.1 |
| Money and credit (annual percent change) | |||||||||||
| Broad money | 8.4 | 5.1 | 8 | 4 | 7.9 | 4.6 | 4.6 | 4.6 | 4.6 | 4.6 | 4.6 |
| Claims to the economy 2/ | 4.9 | 3.8 | 7.1 | 5.3 | 6.9 | 4.5 | 4.1 | 4.2 | 4.2 | 4.2 | 4.2 |
| Balance of payments | |||||||||||
| Current account (percent of GDP) | -1.2 | -2.3 | -3.5 | -0.6 | -1.5 | -2 | -2.2 | -2.6 | -2.9 | -3.1 | -3.3 |
| Exports of goods (in U.S. dollars, annual percent change) | -4.4 | 34.4 | 15.1 | -0.5 | 8.6 | 6.6 | 7.3 | 6.9 | 6.8 | 6.7 | 6.7 |
| Imports of goods (in U.S. dollars, annual percent change) | -12 | 32.1 | 21.9 | -2.5 | 7.9 | 8.1 | 7.5 | 7.4 | 7.3 | 6.4 | 6.2 |
| Merchandise trade balance (percent of GDP) | -12.8 | -14 | -20.2 | -17.3 | -17.3 | -17.8 | -18 | -18.3 | -18.6 | -18.6 | -18.5 |
| FDI (percent of GDP) | 0.8 | 1.1 | 1.2 | 0.2 | 0.7 | 1.4 | 1.5 | 1.6 | 1.6 | 1.7 | 1.7 |
| Gross reserves (months of imports) | 7.2 | 5.8 | 5.3 | 5.4 | 5.2 | 5.2 | 5.2 | 5.2 | 5.1 | 5.1 | 5.2 |
| External Debt (percent of GDP) | 54.2 | 45.5 | 49.5 | 48.2 | 45.3 | 46.1 | 46.3 | 46.8 | 45.9 | 46.5 | 46.5 |
| Exchange rate | |||||||||||
| REER (annual average, percent change) | 1.4 | 1.6 | -3.2 | 0.9 | ... | ... | ... | ... | ... | ... | ... |
| Memorandum Items: | |||||||||||
| Nominal GDP (in billions of U.S. dollars) | 121 | 142 | 131 | 144 | 155 | 166 | 177 | 188 | 199 | 212 | 225 |
| Net imports of energy products (in billions of U.S. dollars) | -5.3 | -8.4 | -15.1 | -12 | -11.5 | -12.1 | -12.3 | -12.8 | -13.2 | -13.7 | -14.1 |
| Local currency per U.S. dollar (period average) | 9.5 | 9 | 10.2 | 10.1 | 9.9 | ... | ... | ... | ... | ... | ... |
| Sources: Moroccan authorities; and Fund staff estimates. | |||||||||||
| ----------------- | |||||||||||
| 1/ Include grants. | |||||||||||
| 2/ Includes credit to public enterprises. | |||||||||||
