Morocco to start cutting fuel subsidies on Sept 16

A customer uses a petrol nozzle to fill up his tank in a gas station in Nice

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A customer uses a petrol nozzle to fill up his tank in a gas station in Nice August 27, 2012. REUTERS/Eric …

RABAT (Reuters) - Morocco's Islamist government, under IMF pressure to cut spending on subsidising food and fuel, plans to start to bring energy prices closer to market costs this month.

The decision to start adjusting prices of energy products from September 16 had been delayed until after Ramadan, the Muslim fasting month.

It was published on a government website on Wednesday in the latest edition of the country's official bulletin and confirmed to Reuters by Communication Minister and government spokesman Mustapha Khalfi.

The International Monetary Fund has urged the government to cut subsidies that burned up 53.36 billion dirhams of public money in 2012 or 6.4 pct of Morocco's economic output.

The government says it aims to keep spending in 2013 within the 42 billion dirhams set in the national budget.

The bulletin said prices of diesel, fuel oil and gasoline would be reviewed twice a month. Prices for cooking gas and sugar remain entirely controlled.

Morocco defused Arab Spring-style protests in 2011 with a combination of social spending, harsh policing and constitutional reforms.

Five ministers, including the finance minister, resigned from the coalition government in July, partly in protest against the subsidy cuts.

Last year the government agreed to changes including deregulating the prices of many staple goods in return for a two-year, $6.2 billion precautionary credit line from the IMF.

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