Mr. Mohamed BOUSSAID at the MAP forum discussing the Finance Act 2016 : 05/01/2016

Mr. Mohamed BOUSSAID at the MAP forum discussing the Finance Act 2016

Mr. Mohammed BOUSSAID, Minister of Economy and Finance, was Tuesday, January 5th 2016, the guest of the Moroccan Press Agency Forum 'MAP'. This meeting was characterized by the presence of representatives of government bodies and the media, as well as personalities from various backgrounds. It was held under the theme "Finance Law: What prospects for the Moroccan economy in 2016?"
The MAP Forum was thus an opportunity for the Minister of Economy and Finance to give information on the Finance Act, the various steps of its preparation and the new provisions applied to it with the entry into force in January 2016 of the new Organic Law relating to it.
Given the Finance Act as one of the most important laws that the Parliament approves each year, Mr. BOUSSAID explained the interest of the political and media bodies in it.
He, thus, mentioned the strong link with the government policy and the national and international economic conditions as well as the impact of results, specifically in the economic field, obtained in previous years. Regarding the 2016 Finance Act, the Minister clarified that it operates in a changing international context with a global GDP to be increased to 3.6% in 2016 against 3.1% in 2015.
The Finance Act 2016 aims to pursue the recovery of macroeconomic balances by reducing the budget deficit from -4.3% in 2015 to -3.5% in 2016 and the current accounts from -2% to -1.5%. Mr. BOUSSAID believes that good public finance management and the recovery of macroeconomic balances strengthen the attractiveness of the national economy and encourage foreign investment. He, thus, confirmed the forecast growth rate for 2016 which is about 3% and stressed that the Finance Act for the current year will continue the reforms and structural projects the Government launched.

The Minister also expected a growth rate in Europe of 1.6% which will impact positively the national economy. "It recorded in 2015 a growth rate of 5% with improvements in many areas." He goes forward stating that phosphates’ sales rose by 6%, electricity production by 6 %, building and public works by 1.7%, appropriations by 5.3%, industrial production by 2.9%.

The trade deficit decreased by 20% due to lower imports, the increase in exports and the fall in the price of oil. For Mr. BOUSSAID, one of the strengths of the economy is that Morocco currently has the equivalent of seven months of foreign reserves.

Furthermore, the Minister stated that the debt ratio will stabilize at 63.4% at end 2015, with a view of a downward trend for 2016 and an estimated rate of 60% for 2020.

“To this end, the Government intends to pursue the recovery of macroeconomic stability, sustain growth and improve the use of exceptional resources, including donations," explained Mr. BOUSSAID.

In addressing the stability of the debt of the Treasury in 2015, the Minister noted the importance to consider multiple risk factors before resorting to debt, namely the risk of exchange rate and maturity.

Indeed, he indicated that short-term debt represent 14% of the public debt, adding that 77% of this debt is owed inside and 23% at the external level.

"By currency, the euro accounts for the lion's share with 77% of the public external debt structure, while the dollar holds 17% of that debt," stated the Minister, expressing the wish to achieve weights of quotation of the dirham currency basket fixed at 60% for the euro and 40% for the US dollar.

Mr. BOUSSAID explained, on another level, that the growth of the national economy remains driven by public investment, which unfortunately does not generate enough jobs.