Morocco minister submits 2010 budget to Parliament

2009-09-04

Morocco's 2010 national budget targets improving Morocco's track record for human development.

By Siham Ali for Magharebia in Rabat – 04/09/09

[Hoamg Dinh Nam/AFP/Getty Images] Prime Minister Abbas El Fassi sent out financial planning guidelines to various government departments.

The Moroccan government is putting the finishing touches on its 2010 finance bill, which it will bring before Parliament in October for discussion and approval.

Prime Minister Abbas El Fassi sent out financial planning guidelines to various government departments on Thursday (August 27th). He said the guidelines were issued on how to best manage the global economic crisis, preserve the competitiveness of the Moroccan economy and continue to support major projects and the social sector. The social sector accounted for 53% percent of the 2009 budget, as part of government efforts to improve Morocco's human development record.

The draft finance bill has a number of objectives, particularly managing the global crisis in order to limit its impact on the national economy. Support measures for those sectors affected by the crisis will continue so that more jobs are not lost. In the same vein, 10,000 new items for the budget are planned.

The social sector hopes to accomplish the following goals in the 2010 budget: promote the social environment and clamp down on shanty towns; progressively apply the insurance regime to cover the economically disadvantaged; reform the compensation fund; and develop rural communities.

MPs are gearing up to hold a debate on the bill. Many members pointed out that 2010 will be a very tough year financially, and that it will be impossible to achieve the objectives set out by the government in its draft finance bill due to current economic conditions.

Finance committee representative Lahcen Daoudi told Magharebia that the most important part is to acknowledge the real extent of the crisis in order to confront it, and said that the government remains too optimistic about Morocco's financial outlook. He is proposing a relaunch package to support consumer demand by cutting the value-added tax (VAT) on a number of basic products, and instead applying the tax to luxury products. He also expressed a wish to see a good agricultural campaign to encourage increasing growth.

Economist Mehdi Marouani said that the growth predictions look ambitious given the economic crisis, but warns that the crisis' real repercussions will only be felt in 2010. Although he believes it is not impossible to attain the projected 2010 economic projections, it will need a lot of hard work and hopefully a good agricultural season, he said.

MP Fatima Moustaghfir said the government must concentrate its efforts each year on one particular sector, rather than scattering spending over all areas to no effect. She said that each time the finance bill is reviewed, results are found to be wanting because of this fragmentation. She would like this year's budget to be devoted to the environment.

"The first thing to do is to maintain public spaces if you want to succeed. Tourism, which is a vital sector for Morocco, will benefit generally," she said. She would like to see more laws regulating cleanliness, street maintenance, public toilets, and planting parks and gardens.

Analysts project Morocco's economy will see 3.2% growth, with 4.1% expansion in agriculture. They also project that the price of oil will also rise to $70 a barrel. Inflation is expected to reach 2.5%.