Morocco King Gives Government Signal for Expansionary Budget

(Bloomberg) -- King Mohammed VI gave Morocco’s new government his tacit approval for an expansionary budget, hinting the $113 billion economy’s on course to shake off the devastating effects of the pandemic.

The kingdom’s economy is expected to grow by more than 5.5% this year, up from an initial target of 4.8%, while a surge in expatriate remittances and foreign investment has pushed foreign-exchange reserves to a “comfortable” level, enough to cover 7 months of imports, the 58-year-old monarch told lawmakers in a televised addressed.

He urged officials to boost public investment and expand state support to companies affected by the Covid health emergency. Authorities need to “consolidate the country’s strategic security” by boosting inventories of foodstuff, energy and medical materials, he also said. 

It was his first speech to the assembly since a business-friendly party closely aligned with the royal court won the most seats in parliamentary elections last month. The kingdom has been gearing up for months to launch an ambitious economic revamp.

But the new administration has other concerns after military hostilities with separatists over the disputed Western Sahara resumed in November, ending a three-decade cease-fire and fueling tensions with neighboring Algeria.

“This legislature begins at a time when Morocco is embarking on a new phase that requires the pooling of efforts around strategic priorities so that our nation can continue its development process and meet external challenges,” said the king, clad in traditional white Moroccan garb.

As for the 15-year overhaul plan, dubbed the New Growth Model, the monarch urged lawmakers to take ownership of the blueprint, hinting that it wasn’t set in stone. 

“Rather, it constitutes a general framework conducive to action and capable of establishing new rules and opening up broad perspectives for everyone,” he said.

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