Morocco to experience budget deficit this year

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Flag of Morocco

Morocco will experience a budget deficit this year according to a report by the Moroccan Economic Centre (CMC) Wednesday, prices will keep increasing and inflation rate is expected to exceed 4.5% (for the first time in recent time) following the global financial crisis. It said the global financial crisis was expected to make Morocco loose between 1 .5 and 2 growth points, considering that the world economic crisis would manifes t in the loss of one growth point in the short term. The office of the Moroccan High Advisory Committee is projecting a growth rate o f 6.1% in 2008. “The loss will be accompanied by a significant deterioration of the internal and external financial balances,” says the Moroccan Institute of Research and Macro-economic studies. CMC reports that the weakening of external demands would contribute to the increase in the country’s trade deficit which has already gulped 7,1 billion euros during the first seven months of 2008. The Central Bank of Morocco, Bank Al-Maghrib, raised its interest rate from 3.25% to 3.5% to cushion the effects of the international crisis and curb the annual inflation rate which reached 4.8% in August 2008. However, the Moroccan Communications Minister and government’s spokesman, Khalid Naciri, declared Thursday that the Moroccan economy “remains sheltered from” the risks of the international financial crisis.

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