PLF 2027: Morocco tightens scrutiny of public projects and budget execution

Morocco is preparing a shift in the way public investment is assessed, with the 2027 Finance Bill placing greater emphasis on the effectiveness of spending rather than simply the volume of funds allocated.

Under the 2027-2029 budget programming framework, government departments and public institutions are expected to demonstrate that proposed projects are sufficiently prepared, financially and technically feasible, and capable of delivering measurable results. The approach seeks to reduce the gap between budget allocations and actual implementation while improving the conversion of public resources into infrastructure and public services.

The change comes as investment spending remains an important driver of economic activity. By the end of June 2026, investment expenditure from the general budget had reached MAD 62.2 billion, representing 45.7% of the MAD 136.1 billion programmed for the full year.

Execution capacity moves to the forefront

For the government, approving funding is only the beginning of an investment project. Land availability, technical studies, administrative authorisations, procurement procedures, construction monitoring and regular financing can all determine whether an operation advances as planned.

The new budget approach therefore places greater weight on the actual capacity of ministries and institutions to implement projects. Previous allocations that remain unused or are carried forward will also have to be considered when assessing new funding requests.

This could make it easier to distinguish genuinely new requirements from projects that already have resources but have yet to translate those resources into completed work.

The first half of 2026 illustrates the differences in implementation rates across government departments. Investment-credit execution reached 84.2% in the department responsible for territorial planning, urban development and housing. The figure stood at 62.7% for the Interior Ministry and 42% for the Education Ministry.

Other sectors recorded lower execution rates, including 30.3% for Health and Social Protection, 34.1% for Agriculture and 19% for Equipment and Water.

Such figures do not necessarily indicate differences in management quality, since large projects can require lengthy preparation before expenditure begins. They do, however, highlight the need for sector-specific monitoring that takes project maturity and implementation schedules into account.

Mature projects to receive priority

For the 2027-2029 period, authorities intend to give priority to programmes already under way before expanding the investment pipeline.

Projects resulting from royal instructions, as well as programmes covered by agreements with institutional, international or donor partners, are expected to receive particular attention. Maintaining continuity in these commitments is intended to prevent resources from being spread too thinly across new initiatives.

Land-related issues are another focus. Authorities want the legal status and availability of project sites to be verified before new operations are included in investment plans.

Securing land at an early stage can help prevent projects from remaining stalled despite having an approved budget, reducing the risk of funds being carried over across several financial years without corresponding physical progress.

Limiting non-priority administrative spending

The government also intends to exercise tighter control over spending on vehicles, administrative buildings, facilities and equipment.

The objective is not to eliminate such expenditure, but to ensure that a larger share of available resources is directed towards projects with a direct economic, social or territorial impact.

The same principle is being extended to public establishments and state-owned companies. Investment subsidies should increasingly be directed towards projects that are already under implementation, with disbursements more closely connected to progress on the ground and the beneficiaries’ cash-flow position.

This approach would link the timing of public financing more closely to actual project requirements.

It does not alter the strategic role of public enterprises in areas such as transport, water, energy and territorial development. Instead, it introduces a stronger sequencing principle, under which funding is released according to project maturity and implementation needs.

Fiscal consolidation remains a parallel objective

The focus on investment efficiency is also linked to Morocco’s broader fiscal trajectory.

The government is targeting a budget deficit equivalent to 3% of GDP in 2027 and intends to maintain that objective through 2028 and 2029. Public debt is projected to decline from 66.6% of GDP in 2025 to 63% by 2029.

Containing the public-sector wage bill is part of the same framework. Recruitment is expected to focus on essential requirements, while redeploying existing positions could help address staffing needs in specific regions and sectors.

Authorities are also seeking savings in recurrent expenses, including water, electricity, travel, rentals and administrative events.

Investment remains part of the growth strategy

The emphasis on efficiency does not amount to a general retreat from public investment.

Government projections point to a 4.1% increase in investment in 2027, supported by the continuation of major projects. The International Monetary Fund has also highlighted the potential contribution of infrastructure investment to economic activity and employment, while stressing the importance of ensuring adequate economic returns and continuing to invest in human capital.

For Morocco, the challenge is therefore increasingly one of execution: preparing projects properly, securing land, coordinating institutions and controlling deadlines.

The 2027 Finance Bill is consequently placing a stronger emphasis on what happens after a budget allocation is approved. The effectiveness of public spending will increasingly be measured by the infrastructure delivered, services created and tangible results achieved rather than by the size of the initial appropriation alone.