IMF approves $5 billion credit line for Morocco

The rise in prices is hitting Moroccans hard, whose economy is one of the most indebted in Africa. Here, a shopkeeper waits for customers in a shop in Rabat, during the holy month of Ramadan. © Fadel Senna / AFP

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The International Monetary Fund (IMF) on Monday (April 3rd) approved a flexible credit line for Morocco in the amount of five billion dollars over two years, a request that the Cherifian kingdom had expressed in early March. This is the fifth time that Morocco has benefited from such a scheme, the last having expired in 2020, but this time under very favorable conditions, thanks to the country's "very solid economic policies".

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A fund of five billion dollars, flexible and without conditionality a posteriori: if the IMF lends on these favorable terms, it is because of the "very solid economic policies and institutional frameworks" of the country, says the International Monetary Fund. He added that these policies have allowed the Moroccan economy to "remain resilient" in the face of multiple shocks in recent years: the Covid-19 pandemic, two droughts and the consequences of the war in Ukraine.

Designed for crisis prevention, this fund will strengthen "the external cushions" of Morocco, and "provide additional insurance against tail risks," details the institution.

Because if so far the Moroccan economy is holding firm, it is one of the most indebted on the continent and faces various challenges. The Central Bank has had to raise interest rates several times to limit inflation, which still stood at 10% in 2022, and 20% for food. This price increase is hitting part of Moroccan society hard.

The IMF notes that the kingdom's economy also remains vulnerable to a deteriorating global economic and financial environment, increased commodity volatility and recurrent droughts.

► Read also: How the war in Ukraine has affected the economy of African countries for a year

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  • Morocco
  • Economic crisis
  • Economy Africa
  • Economy
  • IMF