Morocco’s central bank has issued a strong warning regarding the alarming situation facing pension systems, asserting that continued delays in reforms have become an expensive and unsustainable option. In its annual report for 2024, the bank emphasized that this issue can no longer tolerate further hesitation, calling for it to be a top priority on the government’s agenda, especially amid increasing financial and demographic pressures that threaten the sustainability of the system.
The report outlined a comprehensive reform plan stemming from the social dialogue agreement signed in April 2024, aimed at establishing a new framework comprising both public and private sectors to ensure a smooth transition to the new model without harming the acquired rights of current contributors. This vision seeks to achieve sustainable social protection that balances the needs of different generations.
The bank pointed out that the significant demographic changes in the kingdom mandate reform, noting that the percentage of citizens over the age of sixty has risen from 8% to 13.8%. This shift has led to a decline in the ratio of contributors to beneficiaries, which threatens the financial equilibrium of pension funds and necessitates restructuring to ensure their continued operation.
The report also indicated that recent wage increases presented a suitable opportunity for advancement in this area; however, the lack of in-depth social dialogue has hindered optimal investment in this opportunity. The bank warned that further delays would exacerbate the financial deficit and increase the social costs anticipated for system rescue, potentially jeopardizing the livelihoods of current and future retirees.
The central bank called for a comprehensive mobilization of all stakeholders, including the government, trade unions, and financial institutions, to initiate a deep and effective reform. It stressed that the future of pensions in Morocco now hinges on the courage and speed of political decision-making and the implementation of necessary solutions before it is too late.
