Morocco was able to maintain in 2019 the same level of budget deficit recorded in 2018. The country’s budget deficit stood at MAD 41.67 billion ($4.517 billion) at the end of 2019, compared to MAD 41.66 billion ($4.515 billion) in 2018.
Budget deficit is the difference between the country’s overall public spending (operating and investment expenditures) and revenue, referring to when spending exceeds revenue.
Morocco’s Court of Auditors announced the figure on Wednesday in its annual report on the execution of the 2019 state budget.
Morocco was able to maintain the same level of budget deficit thanks to an improvement of its “ordinary balance,” the difference between revenue and operating expenditure. At the end of 2019, Morocco’s ordinary balance stood at MAD 26.48 billion ($2.87 billion), marking a 29.9% increase compared to the MAD 20.38 billion ($2.21 billion) recorded in 2018.
The increased ordinary balance covered 37.6% of Morocco’s investment expenditure in 2019, which stood at MAD 70.41 billion ($7.63 billion). In 2018, Morocco’s ordinary balance only covered 31.1% of the country’s investment expenditure.
Morocco’s ordinary balance grew thanks to an increase of MAD 16.83 billion ($1.82 billion) in ordinary revenue, including a MAD 2.76 billion ($299.38 million) increase in tax revenue and MAD 14.04 billion ($1.52 billion) in nontax revenue.
The increased revenue was enough to cover a MAD 15.54 billion ($1.68 billion) increase in overall expenditures and a MAD 1.31 billion ($141.99 million) decline in Special Treasury Accounts (CST) revenue.
Morocco’s debt continues to increase
Despite the stable budget deficit, Morocco’s treasury debt at the end of 2019 increased by 3.5% compared to 2018, reaching MAD 747.99 billion ($81.08 billion).
Morocco’s debt represents 65.4% of its gross domestic product (GDP). The Moroccan government hopes to make the debt less than 60% of the GDP by 2021. However, according to the Court of Auditors, the objective seems hard to achieve.
Between 2009 and 2019, Morocco’s debt more than doubled, increasing from MAD 345.18 billion ($37.41 billion) to MAD 747.99 billion ($81.08 billion). On average, the debt grew by 8% every year over the past decade.
Morocco’s internal debt increased by 2.1% in 2019 compared to 2018, standing at MAD 586.5 billion ($63.57 billion). Internal debt represents 78.4% of Morocco’s overall debt.
Meanwhile, the country’s external debt grew by 9.1% in 2019, reaching MAD 161.5 billion ($17.5 billion). External debt increased by MAD 13.52 billion ($1.46 billion) compared to 2018.