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    Morocco’s Compensation Fund: Subsidy Decrease for Butane Gas, Sugar

    Government subsidies for butane gas and sugar decreased exponentially since March 2020.

    14 Apr 2021

    Rabat – Morocco’s compensation fund released a statement on the decreased government subsidies for butane gas and sugar.

    As of March 2020, subsidies covered MAD 2.75 billion ($307 million) and MAD 1.18 billion ($132 million) for butane gas and sugar respectively.

    Currently, subsidies for a standard 12 kilogram container of butane gas amounted to approximately MAD 2 billion ($223 million). Subsidies for sugar amounted to MAD 1 billion ($112 million).

    The Compensation Fund commented on the decline in government subsidies for butane gas and sugar in Morocco, stating that the COVID-19 pandemic posed new challenges for funding. Additionally, the Ministry of the Interior and the Ministry of Energy cited COVID-19 for the disturbance in prices.

    Adding that subsidies have maintained an upward trend since 2018, the Compensation Fund noted that the decline in the past year is abnormal.

    Throughout the pandemic, producers and consumers worried about the accessibility of butane gas and sugar due to a severe increase in demand. Government entities reassured Moroccans that suppliers would practice responsible fulfilment methods to ensure the “natural cycle” of butane gas accessibility in Morocco.

    In 2019, butane gas suppliers threatened to go on strike during the holy month of Ramadan citing an increase in prices for butane gas.

    Butane gas suppliers have yet to comment on the most recent price increase due to the decrease in state subsidies.


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