Moody’s Ratings Reasons for maintaining Morocco’s rating

Moody’s Ratings (Moody’s) confirms Morocco’s Ba1 rating. The rating is assigned to the Kingdom’s long-term obligations and senior unsecured debt. Overall, the outlook remains stable. What does this rating reflect? A committee was convened in September 2024 to discuss the Moroccan government’s rating. Several points were raised and findings noted. The rating was based on Morocco’s economic fundamentals, including its economic strength, institutions, governance, management in addition to financial or fiscal strength, including its debt profile. 

For the Moody’s team, the stable outlook reflects the many expectations. The Moroccan government will need to pursue economic and social reforms to improve the economy’s resilience to shocks, while keeping the debt burden stable. “ We expect the Government to continue its budget consolidation efforts in the face of spending pressures resulting from social security reforms and a vast pipeline of infrastructure projects, as well as continued exposure to shocks, particularly those related to climate,” said the economists. Morocco has demonstrated robust crisis management capabilities in the face of major external shocks. This resilience underscores the country’s solid governance and institutional framework. Monetary and macroeconomic policies are marked by Bank Al-Maghrib’s track record in maintaining price stability. This has reinforced the credibility of monetary policy. This stability is underpinned by a controlled approach to exchange rate liberalization. Morocco’s fiscal policy reflects a balance between maintaining budgetary discipline and combating social and external pressures. The Government has implemented coherent macroeconomic policies and fiscal reforms aimed at improving health, education and social protection. At the same time, it has improved revenue collection and governance in the public sector. 
  
Fatim-Zahra TOHRY