International Journal of Science and Research (IJSR)

International Journal of Science and Research (IJSR)
www.ijsr.net | Most Trusted Research Journal Since Year 2012

ISSN: 2319-7064



Research Paper | Economics | Morocco | Volume 7 Issue 11, November 2018

The Evolution of the Subsidy System in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

The reform of the subsidy policy in Morocco is in a constant evolution due to multiple and crucial governmental decisions taken in the last decade. The system was (and still is) gradually heading towards the liberalization of the prices of highly consumed products such as sugar, liquid petroleum products, butane gas and national soft wheat flour. However, the system is playing a very important role in mitigating the negative impacts of the sudden and brutal changes that occur daily on international markets, on national consumers, especially those belonging to low-income social classes. During the last few years, global crises were constantly emerging and causing a continuously increased inflation for most staple goods, especially liquid petroleum products (Diesel, gasoline, and fuel). This had severe repercussions on public finances, causing for the first time in 2009, a deficit of 6.2 Billion/MAD. A couple of years later in 2012, a year that was a significant stop in the policy changing process, the deficit reached alarming levels and reopened a serious debate about the accuracy of the compensation system. The compensation expenditures were a heavy burden on public finances throughout the years. An issue that the State was dealing with by incessantly trying to find new alternative solutions for the unexpected and immeasurable charges that it inevitably faced everytime a price jump took place on the international markets. The heavier the burden got, the harsher critics spoke of a subsidy system that was initially meant to benefit low-income citizens, by protecting their purchasing power from the instability and price fluctuations of basic products. Thus, the public authorities were forced to adjust and rework the whole approach of how subsidies were distributed, as the targeted social classes barely profited from it, while big companies kept on growing and expanding consumption levels, causing real damage to the efficiency of the compensation fund. Many scenarios were being discussed such as whether the compensation fund should be maintained, reformed or totally removed. This debate kept intensifying until 2013, when revolutionary changes and reforms were adopted for the first time, through the implementation of the partial indexation system. However, before detailing the chronological reforms that marked this rupture in the states policy, we will first progressively examine the many aspects of the compensation system in Morocco.

Keywords: Subsidy, reform, purchasing power, compensation fund, public finances

Edition: Volume 7 Issue 11, November 2018

Pages: 1929 - 1933

Share this Article

How to Cite this Article?

Moustapha Hamzaoui, Safaa El Yahyaoui, "The Evolution of the Subsidy System in Morocco", International Journal of Science and Research (IJSR), https://www.ijsr.net/search_index_results_paperid.php?id=ART20193243, Volume 7 Issue 11, November 2018, 1929 - 1933

90 PDF Views | 62 PDF Downloads

Download Article PDF

Similar Articles with Keyword 'Subsidy'

Research Paper, Economics, Sri Lanka, Volume 3 Issue 10, October 2014

Pages: 1261 - 1267

Economic and Social Cost of Fertilizer Subsidy on Paddy Farming in Sri Lanka

Dr. Wanninayake. M. Semasinghe

Share this Article

Research Paper, Economics, Saudi Arabia, Volume 7 Issue 1, January 2018

Pages: 390 - 396

Privatization of Saudi Healthcare Facilities: Is it a Good Strategy?

A.K. Alhowaish, A.Y. Shinawi

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1938 - 1941

A Benchmark of Implementing Energy Subsidy Reforms: Case Studies on Brazil, Chile, Indonesia, Turkey and Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1929 - 1933

The Evolution of the Subsidy System in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1934 - 1937

The Macroeconomic Impacts of Reforming Subsidy Policy in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Similar Articles with Keyword 'reform'

Research Paper, Economics, India, Volume 5 Issue 6, June 2016

Pages: 1463 - 1467

Paradox of Success of Punjab Agriculture in Global Village: A Study on Challenges and Suggestions

Mnisha Shoor

Share this Article

Research Paper, Economics, India, Volume 4 Issue 7, July 2015

Pages: 2391 - 2394

Growth of Income Inequality and its Trend in North Eastern States of India

Gopal Kumar Sarma

Share this Article

Research Paper, Economics, China, Volume 6 Issue 8, August 2017

Pages: 1291 - 1295

The Influence of Supply-Side Factors on the Upgrading of China's Industrial Structure

Juan Shang, Yao Tong

Share this Article

Research Paper, Economics, India, Volume 3 Issue 8, August 2014

Pages: 286 - 289

Women Crime in India - An Analytical Framework

Dr. D. Kumuda

Share this Article

Informative Article, Economics, India, Volume 3 Issue 8, August 2014

Pages: 913 - 915

Role of FDI in Indian Retail Business

Dr. Veena Sharma

Share this Article

Similar Articles with Keyword 'purchasing power'

Informative Article, Economics, India, Volume 3 Issue 8, August 2014

Pages: 913 - 915

Role of FDI in Indian Retail Business

Dr. Veena Sharma

Share this Article

Research Paper, Economics, Zimbabwe, Volume 5 Issue 1, January 2016

Pages: 1769 - 1776

Agricultural Productivity and Food Security in Sub-Saharan Africa

Washington Muzari

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1938 - 1941

A Benchmark of Implementing Energy Subsidy Reforms: Case Studies on Brazil, Chile, Indonesia, Turkey and Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1929 - 1933

The Evolution of the Subsidy System in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 8 Issue 2, February 2019

Pages: 47 - 49

The Performance of Social Welfare Programs in Morocco: Successive Reforms, Oblivious to Eventual Social Impacts

Moustapha HAMZAOUI, Safaa EL YAHYAOUI

Share this Article

Similar Articles with Keyword 'compensation fund'

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1929 - 1933

The Evolution of the Subsidy System in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1934 - 1937

The Macroeconomic Impacts of Reforming Subsidy Policy in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Similar Articles with Keyword 'public finances'

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1929 - 1933

The Evolution of the Subsidy System in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article

Research Paper, Economics, Morocco, Volume 7 Issue 11, November 2018

Pages: 1934 - 1937

The Macroeconomic Impacts of Reforming Subsidy Policy in Morocco

Moustapha Hamzaoui, Safaa El Yahyaoui

Share this Article



Top