During a joint meeting of the Finance Committees of the House of Representatives and the House of Councillors, the Minister Delegate to the Minister of Economy and Finance, in charge of the Budget, Fouzi Lekjaa, made a presentation on the execution of the budget for the year 2023, the preparation of the finance bill (PLF) for the year 2024, as well as the budget planning for the three years 2024 to 2026.
During this meeting, Lekjaa detailed the most important developments in foreign trade until the end of May 2023. It shows a slowdown in the growth of foreign trade in goods in an international context marked by the decline in growth. world, particularly in the euro zone, Morocco’s main partner, and by the increased risk of recession.
In detail, the Minister notes a slight increase in the trade deficit of 1.7% due to the increase in exports by 3.6% and imports by 2.8%. However, he underlines the continuation of the dynamics of transfers from Moroccans residing abroad (MRE) with an increase of 14.9%, as well as a strong recovery in income from tourism (19.4 billion dirhams, or 91. 3%), greatly exceeding the levels recorded before the health crisis.
In addition, Lekjaa reveals in his presentation an 11.9% drop in foreign direct investment (FDI) flows in Morocco, foreign exchange reserves at the satisfactory level at the Bank of Morocco, making it possible to cover approximately 6 months of imports. , as well as the stability of the dirham exchange rate within a fluctuation range of ± 5%, reflecting the confidence of economic actors in the solidity of the national economy.
A slight increase in the trade deficit for goods (+1.7%)
In the area of trade in goods, the Minister underlines a slight increase in the trade deficit of 1.7%, or 1.9 billion dirhams. This increase is due to imports of current consumer goods and food, but he also notes an improvement in the rate of coverage of imports by exports of 0.4 points.
It also notes a sharp drop in sales of phosphate and its derivatives (-34%) mainly due to the drop in prices (-27%), and an increase in exports, excluding phosphate and its derivatives, of 17.1%, mainly due to price increase of 10.6% and volume increase of 5.9%.
With regard to the export sectors, the Minister notes a good performance of the other sectors, in particular automotive, textiles and leather, electronics and household appliances, with an increase in imports of 2.8% in due to increased purchases of capital goods and consumer and food products.
The minister also points to a 35.9% increase in manufacturing sales, as well as a 46.3% increase in yarn sales. Moreover, the number of cars exported through the end of March 2023 increased by 34.2%, reaching around 106,000 units, despite the shortage of semiconductors which slowed production worldwide. He also mentions that the company Stellantis has announced the doubling of its production capacity in the Kenitra factory, from 200,000 to 450,000 units by 2025.
In the agri-food sector, exports were stable at around 42 billion dirhams. This stability is mainly attributed to a slight increase in exports from the agro-food industry (+0.1%), thus offsetting the drop in sales in agriculture, livestock and fishing (-1%).
With regard to the sales of the assembly sectors, they decreased by 12%, while the sales of electrical wiring systems (EWIS) increased by 11.6%, with a local integration rate of approximately 40 %. Similarly, sales of wires and cables increased by 44.3%, as well as electronic components by 33.7%.
The Minister also points out in his presentation that new opportunities are emerging with the emergence of better companies in the automotive, aviation, railway, renewable energy and defense sectors. It also notes that Morocco has become the 9th supplier to the European Union in 2022, with a market share of 3.0%.