Credit line

Morocco abandons bond issuance for IMF credit line: minister

By Ahmed Eljechtimi

RABAT, October 25 (Reuters)Morocco has not issued an international bond this year due to market volatility and rising interest rates, opting instead for a line of credit from the International Monetary Fund to shore up public finances, it said on Tuesday. the Minister of Finance.

The last time Morocco issued an international bond was in 2020, when it raised $3 billion.

“This year, we did not issue an international bond because the market is volatile and investors lack visibility,” said Nadia Fettah Alaoui.

“Rates are going to be expensive, that’s clear,” she said, adding, “When we have visibility, we will appeal to the bond market because we need to safeguard Morocco’s good image” with investors.

Morocco should access a new line of credit with the IMF as it is also exploring “other IMF credit mechanisms”, she said without providing further data on the amount.

The government would also seek funding from bilateral and multilateral partners, while balancing domestic and external debt to meet financial needs which are expected to reach 64 billion dirhams ($5.8 billion), she said.

In its draft 2023 budget, the government increased its budget to 600 billion dirhams, up 15.4% from this year, providing for increased spending on social safety nets, health, education and social security. ‘army.

Overall, the government expects tax and customs revenue to increase by 14.5% in 2023, helping to reduce the budget deficit to 4.5% of gross domestic product from 5.3% expected this year. and reduce public debt to 70% of GDP, according to the draft budget. be approved by parliament.

The government is also targeting economic growth of 4% in 2023 against 1.5% expected this year, assuming an average harvest and annual inflation of 2%.

Public investments will increase next year from 55 billion dirhams to 300 billion dirhams.

(Reporting by Ahmed Eljechtimi, editing by William Maclean)

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