Washington - Following a slowdown in 2014, Morocco's economy will pick up speed in 2015, thanks to a strong overall economic performance, the International Monetary Fund (IMF) noted.
"Policy action has helped reduce fiscal and external vulnerabilities and significant progress has been achieved on reforms", the IMF pointed out in a statement issued following the second review of Morocco’s economic performance.
This review was done by the Executive Board of the International Monetary Fund (IMF) under a program supported by a two-year Precautionary and Liquidity line (PLL) arrangement and the Ex Post Evaluation of exceptional access (EPE) under the 2012-2014 PLL arrangement.
In an environment that remains subject to significant downside risks, sustaining the momentum will be critical to reduce remaining vulnerabilities and achieve higher and more inclusive growth, the same source noted.
"Fiscal developments have been consistent with the authorities’ objective to reduce the deficit to 4.3 percent of GDP in 2015", the IMF said, adding that progress continues on the subsidy reform, while support for the most vulnerable has expanded.
Noting that the recent adoption of a new organic budget strengthens the fiscal framework, the IMF stressed that the timely adoption of the pension reform will be key to ensure the viability of the system.
The IMF said that Morocco’s external position has continued to improve due to the strong performance of exports and lower oil prices. The IMF also believes that further progress on structural reforms, including improvement of the business environment, governance, transparency and the job market will help strengthen competitiveness, growth and employment; as well as enhance the economy’s resilience to shocks.
The IMF recalled that the current PLL arrangement was approved in July 2014, adding that access under this arrangement in the second year is equivalent to US$5 billion.
MWN with MAP
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