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UPDATE 1-Morocco needs $2.8 bln in external borrowing in 2015 -minister
October 20, 2014 / 3:32 PM / 3 years ago

UPDATE 1-Morocco needs $2.8 bln in external borrowing in 2015 -minister

RABAT, Oct 20 (Reuters) - Morocco’s needs external borrowing of 24 billion dirhams ($2.8 billion) next year to plug a budget deficit estimated at 4.3 percent of gross domestic product, Finance Minister Mohamed Boussaid said on Monday.

The government is likely to hit a 4.9 percent budget deficit target this year, down from 5.5 percent in 2013, he said.

Morocco may tap international bond markets to raise some of the necessary funding, Boussaid told Reuters by telephone from the North African kingdom, which has been carrying out structural reforms to trim public spending.

“It depends on the market’s opportunities. We may raise bonds in the international capital markets, but we can also sign deals with international lenders,” Boussaid said.

Under pressure from lenders -- mainly the International Monetary Fund and World Bank -- to cut spending, Morocco plans to reduce its outlay on subsidies to 23 billion dirhams in 2015 from 35 billion in 2014 and 42 billion in 2013, according to the draft budget Boussaid will present to parliament on Monday.

The country expects its economy to grow 4.4 percent next year, after slowing to 2.5 percent in 2014 because of a drop in agricultural output. Expected growth in 2015 is based on a cereal harvest of 7 million tonnes and an oil price of $103. (Reporting by Aziz El Yaakoubi; Editing by Louise Ireland)

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