World Bank Urges the Moroccan Government to Hasten Reforms

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By Loubna Flah

Morocco World News

Casablanca, June 16, 2013

The World Bank urged the Moroccan government to implement urgently the reforms promised in order to contain the economic downturn and to boost growth and job creation.

The World Bank warned in its report issued last week that the economic prospects of the world economy are rather dim, hence the need for a comprehensive reform policy as reported by the Moroccan daily Al Massae.

The report pinpointed that the fall of economic indexes in the world requires Morocco to design an urgent reform plan to exit the crisis with less damages. The World Bank warned also that the delay in the reforms is susceptible to affect severely Morocco’s major economic sectors.

The World Bank expects a steep rise in Morocco’s deficit of the current account balance to - 9, 7% during the current year. This figure remains the highest rate recorded in the North African region.

The current account deficit does not exceed - 8, 4% for Tunisia, whereas Algeria and Libya have respectively achieved a surplus of 5, 4% and 24% in 2013.

The World Bank report considers that the growing deficit in the current account balance highlights the critical situation of the Moroccan economy both at the macro and micro levels. Indeed, the decrease in foreign currency reserves and the liquidity strain are further crippling the Moroccan economy. The World Bank has also mentioned the possibility for Morocco to achieve a GDP around 4, 5% in 2013 with a favorable agricultural season and the control of inflation.

The World Bank report showed that the Moroccan government remains incapable of controlling public spending. Taking into account the conflation of the aforementioned factors, the World Bank predicted a drop in GDP from 3, 5 % in 2012 to 2, 5% in 2013.