Morocco’s Budget Deficit Surges to MAD 21.1 Billion by February 2025

Morocco’s budget deficit reached MAD 21.1 billion ($2.1 billion) by February 2025, a sharp rise from MAD 3.8 billion ($0.38 billion) the previous year. Gross ordinary revenues increased due to higher taxes, although expenditure surged dramatically. A negative ordinary balance of MAD 18.2 billion ($1.82 billion) was recorded, demonstrating the ongoing fiscal challenges faced by the country.

As of February 2025, Morocco’s Treasury reported a significant increase in the budget deficit, which has risen to MAD 21.1 billion ($2.1 billion). This figure represents a considerable decline from the MAD 3.8 billion ($0.38 billion) deficit noted during the same period in the previous year. The General Treasury’s recent monthly bulletin highlights this downward trend in financial health.

The report also indicates a positive balance of MAD 14.2 billion ($1.42 billion) from Special Treasury Accounts (CST) and autonomously managed state services (SEGMA), suggesting that revenue from these accounts helped mitigate some of the overall deficit. Furthermore, gross ordinary revenues experienced a year-over-year increase of 9.7%, totaling MAD 56.6 billion ($5.55 billion) compared to MAD 51.6 billion ($5.16 billion) in February 2024.

A substantial contributing factor to this rise in revenues was a 48.1% increase in direct taxes, alongside a 7.1% rise in indirect taxes. Additionally, registration and stamp duties rose by 2.8%. However, these positive outcomes were slightly overshadowed by a 6% decline in customs duties and a notable 58.5% drop in non-tax revenues.

On the expenditure side, Morocco saw a dramatic 50.5% increase in ordinary expenses, primarily due to a staggering 130.2% rise in costs related to miscellaneous goods and services. Despite this rise, personnel expenses experienced only a slight decrease of 0.8%. Other expenses included a 37.2% increase in debt interest charges and an astonishing 363.4% increase in tax refunds and restitutions.

As a result of the aforementioned revenues and expenditures, Morocco’s ordinary balance took a negative turn, recording MAD 18.2 billion ($1.82 billion) by February 2025, contrasting sharply with the positive balance of MAD 1.9 billion ($0.19 billion) reported a year earlier. Total general budget expenditures amounted to MAD 96 billion ($9.6 billion) at the end of February 2025, marking a significant 41.6% year-over-year increase.

This increase in total expenditures is attributed to a 52.2% rise in operating expenses, a modest 1.3% rise in investment spending, and a staggering 73.9% increase in budgeted debt charges. Additionally, Special Treasury Accounts reflected a revenue of MAD 43.6 billion ($4.36 billion) and expenditures of MAD 29.8 billion ($2.98 billion), resulting in a positive balance of MAD 13.8 billion ($1.38 billion).

In conclusion, Morocco’s financial situation as of February 2025 reveals a striking increase in the budget deficit, highlighting various economic challenges. Despite increased revenues, particularly from direct taxes, significant growth in ordinary expenses has compounded the deficit. The notable spikes in debt charges and tax refunds underscore the complexity of the fiscal landscape, warranting careful monitoring and strategic management moving forward.

Original Source: www.moroccoworldnews.com