Faouzi Lekjaa, Delegate Minister in charge of the budget said today during a press conference following the weekly government council the state will continue supporting various essential consumer goods to mitigate the effects of inflation.
Lekjaa presented various international and domestic product prices, all while comparing them with previous economically stable years, saying that the state’s contributions and measures “prevented citizens from being severely affected by price increases.”
Butane, Gas subsidies protected from price rise
The Delegate Minister spoke about the prices of grains, gas, and fuel, explaining that “the real price of a large bottle of gas weighing 12 kilograms today would be MAD 130,” whereas “thanks to government subsidies, it has continued to cost MAD 40 since 1990.”
Lekjaa stated that the prices of butane gas rose by more than 60% in the international market this year compared to 2020, explaining that the price moved from MAD 530 to MAD 854 per ton in one single year.
The budget allocated to support butane gas has subsequently increased from MAD 9 billion in 2020, to 14 billion and 577 million dirhams in the current year, matching the 60% increase in costs.
Fuel and Oil prices under effects of international markets
With regard to liquid petroleum products, Lekjaa once again attributes the increase to the one noted in international markets, as demand increases and geopolitical uncertainties dominate.
The official elaborated, saying that considering how gasoline prices reached its highest rate since 2014, namely USD 97/barrel, the spike inevitably reflected on the domestic market.
Lekjaa specified that “Morocco surpassed the MAD 10 per liter back in November 2021, when international oil prices reached USD 70.6 a barrel,” a significantly lower rate than the one it’s at today.
The official added that the government has taken a number of measures in order to maintain price stability, as the tax applied to liquid petroleum products remained at 10%, whereas it’s set to 20% across the Middle East and North Africa region.
Additional government measures are underway to alleviate the weight of rising fuel prices on both consumers and businesses, announces Lekjaa, saying that “the executive has opened a discussion with the transportation sector professionals,” who have been among the most affected by this spike.
Grain prices were strongly impacted despite significant government interference
When it comes to yet another vital good, subsidized by the state and severely affected by the current drought this season, grains, Lekjaa stated that the government has taken necessary measures.
According to the Minister Delegate, the government halted import tax on necessary grain and flour imports, “first from mid-February 2021 to May 2021, then from November 2021 to April 2022,” in order to stabilize the domestic price despite higher rates on the international markets.
The minister stated his government “is relying on the recent MAD 10 billion aid package to the agricultural sector” to further stabilize the prices of flour and grains, all while maintaining the government’s annual MAD 1 billion subsidy for the essential item.
Government spokesperson Mustapha Baitas announced, on the same occasion, that the head of Government Aziz Akhannouch will chair, on February 16, a meeting with various departments involved in the “urgent” implementation of the emergency aid aiming to mitigate the effects of this season’s record low precipitation.
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