May 24, 2012
May 24, 2012
Morocco is considering a potential dollar-denominated international bond of up to $1 billion in September or October, a senior finance and economy ministry official said on Wednesday.
“It would be our first issue in dollars and give us the opportunity to diversify,” said El Hassan Eddez, deputy director, treasury and external finance at the ministry’s debt office.
“(If issued) it would be an important size, between $500 million and $1 billion,” he said, speaking on the sidelines of an Arab Monetary Fund conference, adding an issue could come in September or October.
Morocco, the biggest recipient of European Union financial aid outside Europe, raised about 1 billion euros via its most recent international bond issue in 2010.
Eddez said it was still unclear whether the North African country, which has managed to avoid some of the “Arab Spring” turmoil that has struck other countries, would proceed with a bond.
“The uncertainty (over issuance) is because we are almost five months late in our schedule. The budget was only voted on (recently) so we still don’t have a clear idea on the policy.”
Last month, the Morocco’s parliament passed the 2012 budget, targeting a deficit below 5 percent and imposing higher taxes on corporates and alcohol as the government seeks to reduce wide social inequalities and tame protests over unemployment.
Morocco’s current account deficit surged last year to the highest since the 1980s but government ministers have said the country is under no pressure to borrow.
Eddez said the government is also mulling issuing Islamic bonds, or sukuk, once the legal framework is in place possibly by next year. Morocco’s government, led since December by the moderate Islamist Justice and Development Party (PJD), outlined in March how it intends to develop Islamic finance in the country.