Morocco’s budget deficit narrows 1.6% through August

Morocco’s budget deficit narrowed slightly through August as government revenues grew faster than overall spending, the Economy and Finance Ministry said in its September economic outlook report.

The budget deficit stood at 58.6 billion dirhams ($6.4 billion) at the end of August, down 1.6%, or 935 million dirhams, from the same period a year earlier.

The ministry attributed the improvement to a 10% increase in revenues, equivalent to an additional 25.5 billion dirhams, compared with a 7.8% increase in total spending, or 24.6 billion dirhams.

Ordinary revenues reached 280.4 billion dirhams, up 10% year over year and representing 64.8% of the amount projected under the 2026 budget law.

Employee spending increased 9.4% to 130.1 billion dirhams, mainly reflecting measures adopted as part of the government’s social dialogue with trade unions, according to the ministry.

Indirect tax revenues rose 5.8% to 95.9 billion dirhams, representing 60.1% of the amount forecast for the year.

Value-added tax revenues increased 6.3% to 68.7 billion dirhams. VAT collected on imports rose 7% to 43.9 billion dirhams, while domestic VAT revenues increased 5.2% to 24.9 billion dirhams.

Domestic consumption tax revenues rose 4.6% to 27.2 billion dirhams. Taxes on manufactured tobacco increased 5.8% to 9.9 billion dirhams, while taxes on energy products rose 2.8% to 14.5 billion dirhams, coinciding with an increase in fuel volumes placed on the domestic market.

Customs-duty revenues increased 8.4% to 11.8 billion dirhams, while registration and stamp-duty revenues rose 12.6% to 17.3 billion dirhams.

Nontax revenues increased 7.6% to 29.5 billion dirhams by the end of August, equivalent to 47.1% of the amount projected under the 2026 budget.

Separately, Morocco’s foreign-exchange reserves stood at 498 billion dirhams at the end of July, equivalent to about five months and 27 days of imports, according to the ministry.