IMF predicts deep recession for Morocco

The International Monetary Fund (IMF) unveiled last Tuesday its outlook for the world economy for 2020 and 2021. New projections from the Washington-based institution show that the Moroccan economy should experience a more severe recession than expected.

Indeed, the gross domestic product (GDP) is expected to contract by 7% against + 2.2% in 2019, said the international institution in a semi-annual report on the outlook for the world economy.

The Monetary Fund’s projections are thus more alarmist than those of Bank Al-Maghrib, the High Commission for Planning (HCP), the Moroccan Economic Center (CMC) and even the government.

Recall in this regard that at the end of the third quarterly meeting of the year of the Board of Bank Al-Maghrib, held on September 22, the Wali of the Central Bank had declared that his institution was now counting on a contraction of 6, 3% of the national economy instead of 5.2% forecast a month earlier “with declines of 5.3% in agricultural value added and 6.3% of that of non-agricultural sectors”.

Two months earlier, taking into account a planned drop of 9% in taxes and duties on products net of subsidies, the High Commission, for its part, announced that “the gross domestic product should register a decrease of 5, 8% in 2020 instead of an increase of 2.5% recorded in 2019 ”.

In its publication “Maroc Conjoncture” of last August (n ° 327), the CMC predicted that the GDP should contract by 6.2% after having revised downwards its growth forecast for the current year.

Finally, it should be noted that, within the framework of the corrective finance law for the year 2020, the government for its part anticipated a less pessimistic recession of -5% for that same year.

Indeed, “based on assumptions fixing cereal production at around 30 million quintals and the average price of butane gas at US $ 290 per tonne, the growth rate for 2020 would be down 5% ( against 3.7% provided for by the finance law for the year 2020) and the budget deficit would amount to 7.5% (against 3.5% provided for by the finance law for the year 2020) ”, anticipates he.

In its semi-annual report on the outlook for the world economy, the International Monetary Fund also ruled on inflation, which should stand at 0.2%, the same level as in 2019. Before s’ accelerate to 0.8% next year. According to the Bretton Woods institution, Morocco’s external current account should drop from -4.7% in 2019 to -7.3% this year.

It should, however, decline next year to -5.2%. As for unemployment, IMF projections show that it should stand at 12.5% ​​this year against 9.2% in 2019.

The rate should drop to 10.5% in 2021, according to forecasts by economists from the international institution.

Positive point: the economy should return to good health next year. According to the institution’s economists, the gross domestic product is expected to improve to reach 4.9% in 2021.

At the global level, it appears that the world economy is in the process of extricating itself from the abyss into which it sank during the “Grand Confinement” of April, according to the IMF.

However, he anticipates a global growth rate of – 4.4% in 2020, 0.8 percentage point above the forecasts of the June 2020 WEO update.

On the other hand, projections envisage global growth of 5.2% in 2021, or 0.2 points less than in the June 2020 PEM update. According to the organization, “this rebound is expected for 2021 following of the deep contraction recorded in 2020 would translate into a slight increase in world GDP over 2020 and 2021, by 0.6 percentage point compared to 2019 ”.

Never mind, and despite the fact that China’s recovery has been faster than expected, the Fund asserts that “the long rise of the global economy to levels of activity comparable to those of before the pandemic remains exposed to setbacks ”.

Alain Bouithy