World Bank lends Morocco $150 million for pension system
Morocco-World Bank, Economics, 6/18/1998

The World Bank and Morocco signed in Washington on Wednesday an agreement under which the World Bank grants Morocco a $150 million loan to support a project for the improvement of long-term savings and the pension system.

This is the first of a series of Morocco-World Bank adjustment operations to improve the accumulation and allocation of long-term savings and guarantee the long-term sustainability of Morocco's pension system.

The loan's main objective is to improve the mechanisms of long-term savings efforts and allocation to private productive investments by reforming savings institutions, including insurance companies, savings banks and the pension system, Map reported.

According to a World Bank document, "The Moroccan authorities believe that reforming contractual savings institutions and establishing a level playing field between the government and the private sector for the allocation of financial resources are the next critical phases of financial sector reform." These measures are prerequisites to increasing domestic savings, particularly long-term savings. They will ensure that private firms have access to a wider range of sources of finance and can compete for credit in an equal footing with the public sector.

These measures will contribute to increasing competition in the financial sector by allowing new instruments and agents to emerge alongside commercial banks and to further develop capital markets.

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