Announcement of Meeting of the Consultative Group for Morocco held on January 9, 1985

I FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington , D.C. 20433 , U.S.A.• Telephone : (202 ) 477-1234 BANl<. NEWS RELEASE MEETING OF THE CONSULTATIVE GROUP FOR MOROCCO The Consultative Group for Morocco met in Paris on January 9-11, 1985 to consider Morocco's economic and financial adjustment, its medium-term program and its needs for external assistance. The group comprising 12 bilateral donors and 10 multilateral institutions met under the Chairmanship of Mr. Willi A. Wapenhans ·, Vice-President, Europe Middle East and North Africa Region, World Bank. The Moroccan delegation was led by His Excellency Mr. Ahdellatif Jouahri, Minister of Finance, and included the Minister of Planning, Mr. Abdelhaq Tazi, and the Vice Governor of the Central Bank, Mr. Ahmed Bennani, as well as several senior officials in the government. The Consultative Group focused on Morocco's medium-term adjustment policies and prospects on the basis of reports presented by the government, the World Bank and the International Monetary Fund. The Moroccan delegation reported on the progress of the current adjustment program and outlined the policies it will implement over the next few years to complete the stabilization and restructuring of the economy which is under way. Morocco is now tackling some of the key reforms required to restore a viable balance of payments position in the medium term, including, in particular, measures to promote exports, to restructure production and investment incentives, to increase domestic savings, and to improve resource use. The Minister of Finance, Mr. Jouahri, underlined the government's determination to pursue the present policies of financial austerity and structural reforms, which include a strong emphasis on trade liberalization, export promotion, and greater reliance on the private sector. The Minister of Planning, Mr. Tazi, outlined Morocco's medium-term development strategy which aims to maximize the productive potential of the major economic sectors, and current plans to strengthen the link between planning and budgeting so as to improve the efficiency of public investment. I • ..  - 2 - The group noted with satisfaction that the initial actions taken under the 1983-1984 program have already led to a significant improvement in the balance of payments and encouraged the Moroccan government to continue its adjustment effort. In the course of the discuss ion it was recognized that Morocco faces a difficult transition period and will continue to require sizeable external assistance over the next few years, especially in view of the external debt service burden. The group expressed strong support of the government's medium-term program and agreed that its external financing , which is estimated at approximate ly $3 billion annually in 1985-87 (on a gross basis), is feasible. A significant part of the financing is expected to come from a combination of suitably adapted bilateral assistance, financing from the World Bank, and other multilateral institutions. The Consultative Group also noted the decision of the Moroccan government to seek further external debt rescheduling, which it considers essential for its financing program. Before adjourning , the participants stressed that close coordination would be required in the period ahead in order to insure the strengthening and effective use of external assistance in support of Morocco's adjustment program, and a subsequent Consultat ive Group meeting will be held at an appropri ate time. Representatives of the Governments of Belgium, France, the Federal Republic of Germany, Italy, Japan, Libya, the United Ara b Emirates, Saudi Arabia, Spain, Switze rland, and the United States, and of the African Development Bank, the Arab Monetary Fund, the Commission of the European Communities, the European Investment Bank, the International Monetary Fund, the Islamic Development Bank, the United Nations Development Programme, the World Bank and the World Food Programme attended the meeting. The Government of Canada and the Development Assistance Committee of the Organization for Economic Co-operation and Development were represented as observers. - 0 -