The government is targeting a budget deficit of 3.5%

The overall three-year budget programming document (PBT) for the 2023/25 period, accompanying the 2023 Finance Bill (PLF), reveals that the Government is targeting a budget deficit of 3.5% in 2025.

“Taking into account the outlook of the macroeconomic framework and according to the assumptions used to establish the budget programming for the period 2023-2025, the government is targeting a budget deficit of 4.5% in 2023, 4% in 2024 then 3.5% in 2025. , thus making it possible to maintain the Treasury’s debt at less than 70% of GDP by 2025”, notes the document.

It also shows that this recovery in the budget deficit is based on an increase in tax revenue of 4% on average annually, with an average annual growth rate between 2013 and 2019, i.e. before the shock of 2020, amounted to 3 .4%.

This increase is mainly driven by direct taxation, in particular corporation tax and income tax, which represents 45% of total tax revenue. Their growth rate is forecast at 5.4%. Indirect taxes should also contribute to improving tax revenue, i.e. 2.6% on average over the period 2023-2025.

Non-tax revenues, for their part, should increase by 10.3% on annual average. These revenues include the continued mobilization of resources under innovative financing mechanisms for an amount of 25 billion dirhams (MMDH) in 2023 and 30 billion dirhams/year over the period 2024-2025.

These alternative mechanisms to indebtedness are part of the strategy initiated aimed at ensuring active management of the State’s assets, making it possible to generate additional liquidities, necessary for the financing of priority infrastructure projects and the accompaniment of the various sectoral strategies, underlines the document.

On the expenditure side, their programming for the 2023-2025 period is based on controlling their evolution, i.e. an average annual growth rate of nearly 3%. This control of public expenditure is based on a deceleration in the weight of personnel costs, which should drop from 10.8% of GDP in 2023 to 10.4% of GDP in 2025, as well as on optimized management of expenditure on investment which would be controlled at around 5.7% of GDP by 2025.

This control of public expenditure is also supported by a structural effort in terms of operating expenditure other than salaries, which should be maintained at 7.3% of GDP over the period 2023-2025.

Indeed, the three-year programming of these expenditures includes the gradual redeployment of the resources currently allocated to the financing of the various social programs (RAMED, Tayssir, etc.) and to compensation in favor of the deployment of the project for the generalization of social protection within the framework non-contributory.

With regard to debt interest charges, and despite the expected increase in their value in dirhams, their rate as a percentage of GDP should remain relatively stable at around 2.2%.

And to note that the main assumptions of the macroeconomic framework are counting on an average price of a barrel of Brent of 93 dollars in 2023 against 100 dollars in 2022, 84 dollars in 2024, then 78 dollars in 2025, a euro-dollar parity which should reach 1 .04 in 2022 and 2023 and stand at 1.08 in 2024 and 2025, a cereal production of 75 million quintals per year from 2023 to 2025, corresponding to an average annual production, combined with a consolidation of the performance of other crops and livestock and an increase in foreign demand addressed to Morocco (excluding phosphate products and derivatives) of 2.5% in 2023 after 4% in 2022. This demand should grow by 4.5% in 2024 and 2025.

Previous Post Next Post