Morocco Currency and Financial Markets

From International Business Wiki

 Ryan Thiry

The dollar is worth almost 7 times that of the Moroccan currency. The Moroccan Dirham, denoted by MAD, is the official currency of . Made up of 100 centimes per unit, the currency is issued by the Bank Al-Maghrib ('s central bank).

“The dirham is divided into 100 centimes (c). Centimes exchange hands at market places more often than dirham. This money is available in 10c, 20c, 50c, 1dh, 5dh, 10dh (all coins) and 10dh, 20dh, 50dh, 100dh and 200dh (all notes). Outside of , you can usually get dirhams in () and in . There are also usually foreign exchange shops in the seaports and airports of .”(Thomson Financial) The Moroccan Dirham originates from the 's Drachm, and was used in and the in pre-Islamic times. The name "Dirham" comes from the Roman word "denarius."

“The Moroccan Dirham's currency basket weighs the strength of the euro in heavily. When the euro is strong, the appreciation of the Dirham is attributed to the euro. In December 2004, the Dirham reached the strongest rate it had seen in 10 years (in real terms) because of the strength of the euro at the time.”(Thomson Financial) 's trade deficit has been worsening due to rising imports but the stronger Dirham keeps the inflationary impact of this to a minimum.

“The dirham's trajectory depends on the euro given that it is pegged to a basket of currencies with a heavy euro weighting, and has gained 3.6% since the beginning of the year against the dollar.” (Emerging Markets)

With this currency, the Moroccan financial market has witnessed a great amount of evolution during the last few years. The turnover soared up from 672 million DH in 1989 to 23.9 billion DH in 1995. Meanwhile, the stock market capitalization progressed from 5 billion DH in 1989 to 39 billion DH in 1995, a drastic improvement. “Under the law adopted in 1993, the stock market status changed from a public institution to a private one whose capital is equally shared by the stock market firms. In parallel, the creation of the Deontologic Council of Stocks and Bonds (Conseil Déontologique des Valeurs Mobilières) helped in the smooth running of thee market and ensured the protection of savers. In 1995, reforms were carried on with the setting forth of the new implement regulating the Stock Market activity” (usa-morocco).

Steady growth for the past five years has experts declaring that will be a tourist “hot-spot” in the next few years. has been bettering its roads and total infrastructure in hopes to attract tourists as it seeks to become a richer country. With its currency being outweighed heavily by most countries, it will strive to become a vacation place for people all around the world.