The oil find announced in Morocco last month will provide a tremendous boost to the economy of this North African nation, which imports all its energy, a bank analysis says.
Shortly after the announcement of the find, the Moroccan stock market rose
an 8.6 percent, the highest level reached by an Arab financial market in
August.
The private Mediafinance bank, specializing in treasury values, has
released its study on the economic impact of the oil find in Morocco,
especially on its financial market.
The oil find in Talsint was announced last month by the U.S. Skidmore
Corp., which drills for oil in Morocco.
The bank's study, published by the Moroccan press on last Tuesday, shows that
Morocco will be able to save millions of dollars, as the oil reserves could
help meet the country's energy needs for the next 25 years.
The study remains cautious, however, as to the impact of the find on
interest rates, which depend on a number of macro-economic aggregates that
determine the country's global finance needs. Those include the evolution of
the gross national product, the budget and monetary policy adopted by the
State, inflation rates and the gap between investment rates and savings, as
well as the level of the balance of payments.
Morocco's shift from an oil importing to an oil producing country will help
it save $1.2 billion, which represents 3.4 percent of the GNP, the study
said.
But the study urged the authorities to continue efforts to cut the deficit
and limit imports. The state will benefit from an increase in fiscal
receipts thanks to taxes levied on the value added to be brought in by oil
(estimated at $2 billion) and on the direct receipts of royalties, the study
said.
It added that downsizing the deficit will help Morocco repay its $19
billion foreign debt.These measures will have a positive effect on interest rates, the study said, adding that even after the discovery of oil, Morocco's central bank will continue to play a key role in determining short term interest rates to maintain macro-economic balance.
The oil find will automatically lead to a decrease of petroleum products
prices and, hence, a fall in production costs, the study said, noting that
consumption prices will also follow suit.
The balance of payments will benefit most from the savings to be engendered
by the oil find, said the study, which stressed that a surplus in liquidity in the internal markets will contribute to the decrease of interest rates.
The study concluded that the discovery of hydrocarbons in Morocco will be
"a real driving force" that will entail highly positive effects on the
country, which suffers several, acute economic and social problems.
More than 20 percent of the country's population is unemployed, more than
65 percent is illiterate and 13 percent of Moroccans live below the poverty
line. – (Albawaba-MEBG)
© 2000 Mena Report (www.menareport.com)
