IMF approves $5 billion fiscal boost for Morocco
The International Monetary Fund (IMF) approves a $5 billion boost for Morocco this week as part of the Precautionary and Liquidity Line (PLL) strategy.
The deal, which will focus on “further reducing fiscal and external vulnerabilities, while laying the foundations for higher and more inclusive growth”, will be spread across 24 months, with access to $4.5bn in the first year and the remaining $500 million in the second.
This arrangement will be a renewal of the original two-year PLL deal, which was approved in 2012 and is set to expire in August of this year.
According to the IMF, PLL financing is intended for states who, despite not have any urgent, crisis-provoked economic hardships, need foreign assistance in order to implement their home-grown reforms, reinforce competitiveness and encourage higher and more diverse growth.
In order to qualify, states must have sound economic fundamentals and institutional policy frameworks, while also undergoing sound reform policies and showing commitment to these policies in the future.
Following negotiations on the agreement, Mr. Noayuki Shinohara, IMF deputy managing director and acting chairman of the board, explained: “The authorities are committed to further reducing fiscal and external vulnerabilities, while laying the foundations for higher and more inclusive growth. To achieve these goals, it will be important to control expenditure as well as advance major reforms, including those of subsidies, pension and the tax system. Advancing structural reforms to improve the business climate, the judicial system, access to finance and the labour market will be crucial to achieving higher growth and employment.”