Current account deficit expected to remain below 1 percent of GDP

The current account deficit is expected to remain in 1999 and 2000 below 1% of the gross domestic product (GDP), the Moroccan economy and finance department said.

The current account deficit should remain below 1% of the GDP, despite the worsening of the trade deficit that will be around 8.5% of the GDP in 1999 and 8.7% in 2000 against 8.3% in 1998, the department said in forecasts for 1999-2000 fiscal year.

The worsening of trade deficit will be partially compensated by an improvement in the foreign currency remittances of Moroccan expatriates and of tourism, expected to post a 5% growth in 1999 and 7.2% in 2000. The alleviation by 0.3 points of foreign debt interests will also contribute to compensating the trade deficit.

The current account deficit will be made up for by the flow of foreign capital which will stand at 2.2% of the GDP, ie. $800 million annually, the department said.

Morocco's global imports will grow by 8.6% in 1999 and 10.3% in 2000. The coverage rate of imports by exports will slightly improve to stand at around 71% in 1999 and 2000 against 70% in 1998.