Morocco Draws on IMF Precautionary and Liquidity Credit Line

Fishermen moor their boats during a state of emergency and home confinement orders due to coronavirus, in Rabat, Morocco, Tuesday, April 7, 2020. (AP Photo/Mosa'ab Elshamy)
Fishermen moor their boats during a state of emergency and home confinement orders due to coronavirus, in Rabat, Morocco, Tuesday, April 7, 2020. (AP Photo/Mosa'ab Elshamy)
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Morocco Draws on IMF Precautionary and Liquidity Credit Line

Fishermen moor their boats during a state of emergency and home confinement orders due to coronavirus, in Rabat, Morocco, Tuesday, April 7, 2020. (AP Photo/Mosa'ab Elshamy)
Fishermen moor their boats during a state of emergency and home confinement orders due to coronavirus, in Rabat, Morocco, Tuesday, April 7, 2020. (AP Photo/Mosa'ab Elshamy)

Morocco has started to draw on a $3-billion Precautionary and Liquidity credit Line from the International Monetary Fund to offset a contraction of its economy because of the coronavirus pandemic.

The five-year loan has a grace period of three years, the Moroccan central bank said.

It said the credit line would help "soften the impact of the (coronavirus) crisis on our economy and maintain our exchange reserves at an adequate level".

The credit would be used "mainly to finance the balance of payments and will not impact public debt, in a first for our transactions with the IMF,” the central bank said.

The new credit line is the fourth of its kind since August 2012. But it’s the first time that Morocco resorts to the Precautionary and Liquidity Line (PLL) because of the pandemic’s pressure on the economy.

The IMF, in a statement, said Rabat would "use funds purchased under the PLL to cope with the social and economic impact of COVID-19 and to maintain strong external buffers in a context of heightened uncertainties".

The High Commission for Planning (HCP) expected the economy to contract by 1.8 percent in the first quarter of 2020 instead of the estimated +2.1% had there not been any slowdown caused by the pandemic.

It also expected the Moroccan economy to suffer losses of 11 billion dirhams ($1.2 billion) in the same period as a result of the lockdown.

Losses were estimated at 4.1 billion dirhams ($432 million) in the first quarter, it said.



Gazprom, CNPC Discuss Future Russian Gas Supplies to China

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
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Gazprom, CNPC Discuss Future Russian Gas Supplies to China

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo

The heads of Russia's Gazprom and China's energy company CNPC discussed future Russian gas supplies to China during talks in Beijing, Gazprom said on Friday, as Moscow seeks stronger ties with the world's biggest energy consumer.

Russia, the holder of world's largest gas reserves, has diverted oil supplies from Europe to India and China since the start of the conflict in Ukraine in February 2022, Reuters said.

At the same time, Russia's diversification of pipeline natural gas from the European Union has been slow.

It started gas exports to China via the Power of Siberia pipeline in the end of 2019 and plans to reach the pipeline's annual exporting capacity of 38 billion cubic meters this year.

Russia and China have also agreed on exports of 10 bcm of gas from Russia's Pacific island of Sakhalin starting from 2027.

However, years of talks about the Power of Siberia 2 pipeline, which would ship 50 bcm of gas per year to China via Mongolia, have yet to be concluded as the two sides disagree over issues such as the gas price.

Russian President Vladimir Putin is set to travel to China in early September to participate in celebrations marking the anniversary of the victory over Japan in World War II.

The trip follows Chinese President Xi Jinping's visit to Moscow in May.