US embassy cable - 05RABAT2258

UNCLAS SECTION 01 OF 02 RABAT 002258 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR NEA/MAG, NEA/OFI AND INL/AAE 
DEPT ALSO FOR EB/TPP, EB/IFD AND DRL/IL 
STATE PASS USTR FOR DOUG BELL 
STATE PASS USAID FOR JENNIFER RAGLAND 
USDOC ITA/MAC/ANESA FOR DAVID ROTH 
USDOC FOR FSC/OIO AND CLDP 
USDOL FOR ILAB 
PARIS FOR ZEYA 
LONDON FOR TSOU 
ROME FOR ROSE 
 
E.O. 12958: N/A 
TAGS: ECON, ECPS, EFIN, KCOR, KIPR, MO 
SUBJECT: MOROCCO ECONOMIC HIGHLIGHTS 
 
 
RABAT 00002258  001.2 OF 002 
 
 
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GOM Sees 5.4 Percent Growth in 2006 
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1.  The Government of Morocco's 2006 appropriation bill 
forecasts a 5.4 percent growth rate and a two percent 
inflation rate, with oil at $60 a barrel and an exchange 
rate of nine Moroccan dirham to one U.S. dollar.  Finance 
Minister Fathallah Oualalou revealed these figures during 
his presentation of the nearly $20 billion 2006 
appropriation bill to the lower house of parliament. 
Oualalou predicted a stable balance of payments in 2006, and 
a budget deficit of 3.2 percent of GDP. 
 
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Perception of Corruption "Stabilized" 
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2.  The Corruption Perception Index (CPI), a composite 
measure of corruption calculated annually by Transparency 
International (TI), scored Morocco 3.5 points on a one 
(worst) to ten (best) scale.  The CPI is based on surveys 
conducted among the business community and market analysts. 
According to this year's study, Morocco was ranked 78th out 
of 159 countries, slightly behind last year (77th). 
Historically, Morocco's position improved from 45th in 1999 
to 37th in 2000, but the trend reversed in 2002 (52nd), and 
continued to fall in 2003 (70th).  Morocco was 11th among 
Arab countries, with Oman taking top honors (6.3 points), 
and Iraq coming in last (2.2 points), at 137th out of 159 
countries surveyed. 
 
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Banking Reform Law Passed 
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3.  Minister of Finance officials confirmed to EconCouns 
that Parliament has finally passed the long-awaited Banking 
Reform Law.  The new law formally establishes the separation 
of roles between the Central Bank (Bank Al Maghrib) and the 
Ministry of Finance, giving the Central Bank more 
independence.  Texts detailing the implementation of the law 
and (and other associated "circulars") have not been 
distributed yet and Central Bank officials told Econoff they 
expect to send them out shortly.  Finance officials claim 
the new law will strengthen the role of the central bank in 
bank supervision and control, enlarge auditors' roles, and 
give more protection to depositors.  Meanwhile, banking 
sector contacts said the law, although significant in 
legally formalizing Central Bank independence, will actually 
have little day-to-day impact on commercial banking 
operations. 
 
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Morocco is Third Largest Mobile Market in Africa 
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4.  According to "Jeune Afrique" Magazine, Morocco is the 
third largest mobile market in Africa with about 9.8 million 
subscribers, following South Africa and Nigeria (22 million 
and 11 million, respectively).  Morocco's mobile penetration 
of 244 per thousand dwarfs sub-Saharan Africa's average of 
nine per thousand, according to statistics from the United 
Nations Development Program (UNDP). 
 
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RABAT 00002258  002.2 OF 002 
 
 
Prison Time for Fake CDs 
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5.  A Casablanca court has sentenced seven people to serve 
two months in prison and pay a fine of $1,600 each for 
producing counterfeit Compact Discs.  $1,100 of each fine 
will go to the Moroccan Cinematographic and Musical 
Association, a grouping of musicians, artists and 
performers.