Saturday, July 16, 2011

Morocco - Govt might now move to sell its stake in Maroc Telecom to raise cash

[reuters] Morocco's government -- after a surge in spending to calm street protests -- is again considering the sale of a portion of its 30 percent stake in Maroc Telecom, a source familiar with the matter said.

"It (Maroc Telecom stake sale) is back on the government's agenda," said the source on condition of anonymity. The source declined to elaborate.

A finance and economy ministry representative declined to comment. An official at the department that manages state assets did not respond to an emailed request for comment.

The government last year scrapped the sale of an 8 percent stake in Maroc Telecom, the country's biggest telecom operator, which is controlled by French Vivendi. Earlier, it had announced a sell-off to raise cash.

The same stake is worth 10.1 billion dirhams based on Maroc Telecom's closing stock price on Friday.

As public protests demanding reform started in February, Finance and Economy Minister Salaheddine Mezouar told Reuters the state would need to sell some assets to keep the 2011 budget deficit at its targeted 3.5 percent.

When the protests intensified and strikes multiplied, the government agreed to a multibillion-dollar package to raise wages for public sector employees, as well as for the army and paramilitary forces, in a series of handouts aimed at preventing any spillover from revolts in other Arab countries.

The state also had to almost double to 35 billion dirhams funds budgeted for food and energy subsidies as commodity global prices soared.

The central bank governor, Abdellatif Jouahri, in June said he saw 2011 budget deficit at 4.5 percent to 5 percent of gross domestic product after the wage increases and based on his assumption that cost of subsidies for the year will rise to 45 billion dirhams.

Morocco's GDP stood at 779 billion dirhams in 2010 and Mezouar said in May it may clock a 5 percent rise in 2011.

The government raised 5.3 billion dirhams from the sale in May of a stake in Banque Centrale Populaire and on Friday cashed in 655 million dirhams from the sale of a salt firm to local Delta Holding.

Excluding those receipts and a month after the public wage increase took effect, the budget deficit stood at 17.8 billion dirhams by the end of May, little changed from a year earlier, but up 32 percent from April 2011, central bank data showed.

At the helm of the Arab world's longest-serving dynasty, King Mohammed won in a July 1 referendum an overwhelming support for constitutional changes to grant more power to elected officials while giving him a key say in strategic decisions.

Telecom stake sale back on Moroccan agenda-source

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