Morocco received on April 7, 2020, an amount of $2.97 billion from the International Monetary Fund (IMF) to limit the social and economic impact of the covid-19 pandemic. The fund will also be used to maintain an adequate level of official reserves to ease the tensions on the balance of payments, according to the IMF.

This financing is not within the framework of the $50 billion envelope recently announced by the IMF to help countries in difficulty to manage the consequences of covid-19. The North African country activated its last precautionary and liquidity line obtained from the multilateral institution in December 2018. This facility had been granted as useful insurance against external risks.

Although Morocco has already signed several agreements of this type with the IMF since 2012, this is the first time it has made effective use of it. In this covid-19 crisis, the country's authorities have taken a series of measures to increase health spending and support businesses and households. According to data from the Office of the High Commissioner for Planning, published on 8 April 2020, the country's GDP is expected to fall by 1.8% in the second quarter of this year.

Moreover, the widening external deficit that is taking shape, due to a sharp decline in exports, tourism revenues and remittances from the diaspora is another shock to the economy. In this circumstance, the facility that the Moroccan authorities have just activated will make it possible to maintain some stability in foreign exchange reserves.

Idriss Linge