Moody’s raises Morocco’s rating

Following Standard & Poor’s last September, Moody’s Ratings has also revised its outlook on Morocco’s Ba1 rating, raising it from stable to positive for its long-term debt in both foreign and local currencies. This is good news, as it confirms the Kingdom’s upward trajectory after the outlook was downgraded to negative in 2021. In a short period, the country’s rating has been improved twice in quick succession.
In its assessment report, Moody’s highlights that the positive outlook reflects the gradual improvement in Morocco’s economic and fiscal strength, which is likely to further strengthen its credit profile. If this momentum continues, it confirms the Kingdom’s upward trajectory , following the downgrade to a negative outlook in 2021, linked to the impacts of the health crisis, and its subsequent revision to stable in 2022.
This improvement is promising and paves the way for Investment Grade status in the next rating. This is the level Morocco held before 2020 and the Covid-19 pandemic. In any case, achieving Investment Grade will strengthen investor and lender confidence in the country’s fundamentals. Normally, in the future, Morocco’s credit rating will be highly recognized on the international market, emphasizes a senior official at the Ministry of Finance. According to him, confidence in the country’s future development vision is based on the revival of various private investments, infrastructure spending, the strength of the macroeconomic framework, and the prospects for reducing the budget deficit and debt. This situation has been further reinforced by the fact that non-agricultural growth is consolidating. In non-agricultural sectors, Morocco has achieved 5% growth, which is increasing year after year. This means that the economy is becoming increasingly independent of climate risks. This is a structural characteristic of the country’s economy. Moody’s emphasizes that the rating confirmation reflects the strength of Morocco’s institutions and governance, as well as the continued diversification of its economy. Prudent macroeconomic management, combined with adequate foreign exchange reserves and satisfactory access to both domestic and external financing, contributes to strengthening the country’s macroeconomic resilience.
This review comes at a time of significant international uncertainty, exacerbated by the crisis in the Middle East, highlighting the resilience of the Moroccan economy and the sustainability of its public finances. This stability is based on the implementation of structural reforms and the acceleration of public and private investment.
Mohamed CHAOUI