Morocco Reforms Capital Movement
Morocco plans to integrate its strengthening economy into world markets. Finance Minister Fathallah Oualalou announced that government will allow local business to hold assets in foreign currencies. It will, also allow money to be lent to export clients starting next month. Minister Oualalou said that companies will be allowed to hold fifty percent of their income in foreign currencies thereby reducing foreign exchange costs and reducing currency risks.
In a press conference the Finance Minister that banks will be allowed to keep a greater variety of hedging investments and the maximum length will be five years, up from one. Authorization will no longer be needed by insurers to place five percent of their assets abroad. OPCVM savings funds can place ten percent of their financial portfolios in foreign markets. Other strategies have been put into place as well.
Morocco’s government has seen its tax income strengthened by higher private investment and non-farm growth. It has slowed public borrowing and made other reforms that contributed to making the economy more robust. This has allowed the easing of movement of assets abroad. These measures help to better manage the effects of currency flows and strengthen the confidence in the Moroccan economy.
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