With the second-highest ever historical level of butane gas subsidies, having been in place in 2023, the government now intends to reduce those subsidies to MAD 10.45 billion (USD 1.4 billion) by the end of 2024, according to official documents.
The drop in gas subsidies is anticipated to track the global trend of falling energy prices. In 2023, the government earmarked a whopping MAD 16.7 billion (approximately USD 1.6 billion) to subsidize butane gas canisters. Despite the colossal budget, the 2023 subsidy budget was a 23.4% decrease from the record subsidy in 2022.
Over the past decade, Morocco has invested an astonishing MAD 124.3 billion to keep butane gas prices manageable for consumers.
The subsidy currently accounts for more than 4.5% of the country’s Gross Domestic Product (GDP), significantly higher than other countries. In comparison, nations such as India, Egypt, Indonesia, and Tunisia allocate only between 0.20% and 2.7% of their GDPs to similar subsidies.
Consumption data from the first eight months of 2024 in Morocco indicates steady butane consumption, with a notable increase over the same period last year. Butane gas usage peaked in March attributable to higher consumption during Ramadan, but dropped during the summer months, consistent with seasonal trends in Morocco.