Morocco’s Treasury: National Budget Deficit Stood at 5% of GDP in 2022

Morocco’s national budget deficit stood at MAD 69.5 billion at the end of 2022, almost 5% of the country’s Gross Domestic Production (GDP), down by 0.4% year-on-year.

Rabat – Morocco’s national budget deficit stood at MAD 69.5 billion ($6.8 billion) at the end of 2022, almost 5% of the country’s Gross Domestic Production (GDP), down by 0.4% year-on-year.

According to a new publication from Morocco’s Ministry of Economy and Finance, the country’s budget deficit continued on a “downward trend” in 2022.

State budget deficit occurs when a government’s expenditures exceed its income, prompting countries to borrow money to cover the deficit.

The state rising expenditures in 2022 were mainly due to the country’s efforts to cushion prices for households and preserve the national purchasing power. In addition, Morocco continued to support the national economy through investments, and tax cuts among other measures.

Amid the ongoing price shocks, government expenditures rose by 14% year-on-year in 2022. The cost of subsidizing basic commodities rose by MAD 20.3 billion ($1.9 billion) on the backdrop of rising gas prices and the direct financial support allocated to transportation workers.

Meanwhile, treasury revenues have also increased from both tax and non-tax sources, the report notes. At the end of 2022, tax revenues grew by 17%, or MAD 37.3 billion ($3.6 billion), outperforming government predictions. Tax revenues reached MAD 48.7 billion ($4.7 billion) at the end of 2022.

In 2022, the World Bank (WB) warned that Morocco’s subsiding campaign would heavily affect its budget deficit. However, Morocco’s actual budget deficit fell short by 6.4% of GDP the WB predicted.