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Morocco: High Planning Commissioner Calls for Exploiting Inflation to Encourage Growth

High Planning Commissioner Ahmed Lahlimi Alami speaks during a news conference at the Royal Mansour Hotel in Casablanca, Morocco, Tuesday, Jan. 20, 2015. (AP Photo/Abdeljalil Bounhar)
High Planning Commissioner Ahmed Lahlimi Alami speaks during a news conference at the Royal Mansour Hotel in Casablanca, Morocco, Tuesday, Jan. 20, 2015. (AP Photo/Abdeljalil Bounhar)
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Morocco: High Planning Commissioner Calls for Exploiting Inflation to Encourage Growth

High Planning Commissioner Ahmed Lahlimi Alami speaks during a news conference at the Royal Mansour Hotel in Casablanca, Morocco, Tuesday, Jan. 20, 2015. (AP Photo/Abdeljalil Bounhar)
High Planning Commissioner Ahmed Lahlimi Alami speaks during a news conference at the Royal Mansour Hotel in Casablanca, Morocco, Tuesday, Jan. 20, 2015. (AP Photo/Abdeljalil Bounhar)

High Planning Commissioner Ahmed Lahlimi Alami noted that the majority of emerging economies are witnessing an inflation rate of more than seven percent, while inflation in Morocco rated less than one percent.

He criticized the government for encouraging foreign investment by major companies rather than empowering small and medium enterprises.

At a press conference he held in Casablanca on the economic situation in 2019 and its outlook in 2020, Lahlimi expected Morocco’s growth rate to drop from 3 to 2.7 percent this year due to the decline in the agricultural sector’s net output.

He expected the non-agricultural sector to witness a growth from 2.8 to 3.2 percent in 2018.

The Moroccan auto industry will witness a 6 percent relapse due to the global market crisis, he added.

This sector – highly supported by the government – has made a remarkable achievement, forming more than 20 percent of total Moroccan exports, Lahlimi said.

He demanded the government to adopt an expansionary fiscal policy to back economic growth and allow the government to pay off its debt.

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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage

The International Monetary Fund (IMF) approved the third review of Sri Lanka's $2.9 billion bailout on Saturday but warned that the economy remains vulnerable.
In a statement, the global lender said it would release about $333 million, bringing total funding to around $1.3 billion, to the crisis-hit South Asian nation. It said signs of an economic recovery were emerging, Reuters reported.
In a note of caution, it said "the critical next steps are to complete the commercial debt restructuring, finalize bilateral agreements with official creditors along the lines of the accord with the Official Creditor Committee and implement the terms of the other agreements. This will help restore Sri Lanka's debt sustainability."
Cash-strapped Sri Lanka plunged into its worst financial crisis in more than seven decades in 2022 with a severe dollar shortage sending inflation soaring to 70%, its currency to record lows and its economy contracting by 7.3% during the worst of the fallout and by 2.3% last year.
"Maintaining macroeconomic stability and restoring debt sustainability are key to securing Sri Lanka's prosperity and require persevering with responsible fiscal policy," the IMF said.
The IMF bailout secured in March last year helped stabilize economic conditions. The rupee has risen 11.3% in recent months and inflation disappeared, with prices falling 0.8% last month.
The island nation's economy is expected to grow 4.4% this year, the first increase in three years, according to the World Bank.
However, Sri Lanka still needs to complete a $12.5 billion debt restructuring with bondholders, which President Anura Kumara Dissanayake aims to finalize in December.
Sri Lanka will enter into individual agreements with bilateral creditors including Japan, China and India needed to complete a $10 billion debt restructuring, Dissanayake said.
He won the presidency in September, and his leftist coalition won a record 159 seats in the 225-member parliament in a general election last week.