Executive summary
In terms of economic performance, Morocco can do better. The country performs certainly greater than its peers in terms of budget balance and external balance. Nevertheless, growth should be improved. The preparation of the Finance Act thus presents an opportunity to implement a fiscal policy which promotes more sustained growth. The 2020 FAD guidance note defined the outlines of this fiscal year :
- Growth would be supported by public investment. The latter will give priority to efficient investments in accordance with the new directives of the Organic Law of Finance. In order to support the private sector, the 2020 FAD works for the establishment of a trust’s climate between the Administration and the taxpayers.
- Keeping the fiscal deficit at an acceptable level remains at the top of the priorities. Indeed, this FY 2020 copy presents a solid budget structure based on realistic assumptions. In addition, the FAD introduces new funding mechanisms which ensure a budgetary leeway.
Overall, Morocco remains an attractive destination for investors. This is proved through the success of Eurobond issuance for an amount of € 1 Bn, oversubscribed by almost 5.3x with a relatively low risk premium of 139.7 BPS.
