The UAE has joined the likes of its other MidEast neighbor and has donated $300 million to Morocco to ease the economic pain stemming from rising oil prices. This amount will be added to a $500 million grant from Saudi Arabia that came earlier this month.
Some analysts report that Morocco may struggle to maintain subsidies unless it allows its budget deficit to exceed the 3.5% target originally set. The North African country has faced a 69% increase compared to the same period last year for the cost of its oil imports.
Morocco’s Energy Minister Amina Benkhadra said the government is “seeking to overcome the oil deficit caused by the soaring oil prices at the international market and its repercussions on Morocco.” Toward this end, Benkhadra added that the country intends to institute the Moroccan Energy Development Fund worth $1 billion.
Benkhadra has increasingly stressed the importance of putting a strategy in place to counteract the negative impact the rising price of crude is having on Morocco’s economy. This strategy will include developing renewable energies such as solar and wind in the Kingdom. By 2020, Morocco will seek to increase its renewable energy contribution from its current level of 4% to 10%.