Trade Deficit Doesn’t Get any Better

The trade deficit is widening. It reached 16.3 billion Dirhams at the end of January.

Still no relief in the trade balance. In today’s edition, L’Economiste reports a 1.7% increase in the deficit with a coverage rate of 59.8%. Thus, the newspaper notes a slight increase in imports to MAD 40.7 billion, against MAD 24.3 billion for exports.

In detail, foreign purchases were characterized by a strong increase in energy bill: +14.7% due to the increase in the volume of diesel and fuel oil purchases, as well as the price effect. Purchases of food products and finished products also rose (+12.3% and +4.3%).

The supply of capital goods also increased by 3.2% to reach a rate of 25.3%. L’Economiste notes a 56.7% drop in imports of semi-finished and raw products, wire, bars and profiles of iron or non-alloy steel.

On the level of exports, the paper notes that the 1.2% increase is due to the growth of exports from agriculture and food processing (+2%), textiles and leather (+3.6%), aeronautics (+2.7%) and pharmaceuticals (+35.6%). The surprise comes from the automotive sector, where shipments have virtually remained unchanged. “The share of cabling in these exports stood at 42.3% at the end of January, up 0.9 points compared with the same period last year. Automotive manufacturing is at 40.8%, down 5.1 points compared to the previous year”.

The situation is even worse for sales of phosphates and derivatives (-10.7%), mining (43.3%) and electronics (-4.3%).

Revenue from Moroccans living abroad and foreign direct investment are also down. “While the first fell by 2.7%, foreign direct investment flows fell by 32.2%. January was also marked by a travel balance surplus of +10.2%”.

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