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    Morocco Receives €114.03 Million Loan from African Development Bank

    The loan seeks to boost small-scale agriculture to improve productivity and living conditions in rural areas.

    25 Nov 2021

    Rabat - Morocco has received a new loan of MAD 1.18 billion (€114.03 million) from the African Development Bank (AfDB), with both parties commenting that the loan will be used to improve the small-scale agriculture sector in rural or remote areas.

    Morocco and the African bank signed the loan agreement on Tuesday. It aims to support the Program for Inclusive and Sustainable Development of Agricultural and Rural Areas, they said.

    The program is also set to contribute to improving living conditions in agricultural or rural areas, mainly by fostering the emergence of a new generation of agriculture-oriented middle class. Another projection is to build the resilience of Moroccan agriculture, particularly “small-scale agriculture, to the effects of climate change,” AfDBsaid.

    According to a statement from the Moroccan Ministry of Agriculture, the program is part of Generation Green 2020-2030, Morocco’s strategy for smart and sustainable agriculture.

    The strategy is designed to support small and medium hydropower in around 60 areas, with a view to promoting employment and empowering small-scale farmers, the ministry detailed.

    Fouzi Lekjaa, Morocco’s Delegate Minister for Budget, and Achraf Tarsim, the African Development Bank’s representative in Morocco, both highlighted the quality of the long-standing cooperation between the Moroccan government and the African bank.

    The two officials signed the agreement for the loan, expressed their satisfaction with the AfDB-Morocco partnership, and spoke with optimism about the realization of the projects linked to the loan.

    Minister of Agriculture Mohammed Sadiki also attended the signing ceremony.

    The African Development Bank has been a key economic partner for Morocco, and the continental bank has provided the North African country with several loans to help it implement sustainable development programs.

    Last May, the bank loaned Morocco $1 million to support the country’s business climate.

    While such loans have been credited with accelerating a number of development projects in Morocco, the country’s top financial and banking officials have raised concerns about the long-term effect of loans on the Moroccan economy.

    In July, Abdellatif Jouahri, the governor of Morocco’s central bank, rang the alarm bells about Morocco’s rising public debt. The country’s debt rose to 76.4% of GDP in 2020 (compared to 64.8% in 2019), Jouahri said, warning against the negative impacts of an unsustainably high public debt.

    With these worrying figures being attributed to the socio-economic repercussions of the COVID crisis, many financial experts in Morocco hope for the country to devise mechanisms (including increasing tax revenues) that could keep its economy afloat without over-relying on loans.

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