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House of Councillors Approves Morocco's Amended 2020 Finance Bill

House of Councillors Approves Morocco's Amended 2020 Finance Bill

Image from Moroccoworldnews

During a session on Friday, July 17, 29 deputies approved the bill, 13 rejected it, and four abstained from the vote.

The finance bill amendments came in response to the COVID-19 pandemic and the new expenses it created.

The Moroccan Government Council and King Mohammed VI approved the amended 2020 finance bill on July 7. Five days later, the House of Representatives also voted in favor of the bill.

Following its approval by the Upper Chamber of the Moroccan Parliament, the new bill is set to go official in the upcoming week after its publishing on Morocco's Official Bulletin.

The amended 2020 finance bill focuses on three main axes: The progressive restart of economic activity, the preservation of jobs, and the acceleration of administrative reforms.

The legal text insists the need to establish sectoral conventions to relaunch Morocco’s economy. The conventions must take into consideration the specificities of every sector and the impacts of the COVID-19 crisis.

The legal text does not decrease the budgets of social sectors. Meanwhile, it increases the budgets allocated to health, education, the fight against drought, and the fight against social disparities.

Amendments for economic relaunch
The updated bill allocates MAD 5 billion ($518 million) to accompany businesses in their relaunch period, including public enterprises. The budget would allow companies to benefit from loans with a maximal interest rate of 3.5% and a reimbursement period of seven years.

Moroccan businesses will also benefit from a two-year grace period and a state guarantee of the loans. The Moroccan government, through the Central Guarantee Fund (CCG), will guarantee 80% to 90% of the loans. The guarantee rate could also reach 95% for micro-sized enterprises.

Under the new finance bill, CCG would undergo institutional reform by adopting better international practices, optimizing its governance, modernizing its financial management, and adapting new monitoring and management protocols.

The rectified finance bill also allocates an additional MAD 15 billion ($1.55 billion) for public investments. The total 2020 budget for public investments would stand at MAD 86 billion ($8.92 billion).

For job preservation, the new legal text would facilitate both social and economic support for sectors in difficulty.

The new bill allows 80% of employees registered under CNSS and working in hard-hit sectors to keep their jobs. It also allows the acceleration of the registration process for non-declared employees.

Finally, the amended 2020 finance bill aims to strengthen the business climate by simplifying and digitizing administrative procedures. It also aims to generalize payment through electronic methods.

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