New International Bond Insurance: Moroccan Government Launches Investor Roadshow
Economic growth, budget deficit management, public debt, and foreign direct investment (FDI) were at the core of recent analyses conducted by Fitch Ratings, Moody’s, and Standard & Poor’s, all of which reaffirmed their confidence in Morocco’s macroeconomic outlook.
This time, Moody’s has published its latest report on Morocco, maintaining the country’s Ba1 credit rating with a stable outlook. The rating reflects a balance between the government’s sound macroeconomic policies and the country’s ongoing structural challenges—particularly related to growth, debt levels, and inflation.
Morocco’s fiscal, social, and economic policies have proven effective in maintaining social cohesion and economic stability in the face of multiple external shocks. This has come at the cost of higher but manageable debt levels.
According to information reported by Bloomberg—and confirmed by L’Économiste via the Ministry of Economy and Finance—the Moroccan government launched a roadshow on Monday to promote a new international bond issuance. The tour includes stops in Paris and London, where Moroccan officials, led by Finance Minister Nadia Fettah, will meet with global investors.
The upcoming sovereign bond will consist of two tranches, with maturities of 4 and 10 years, subject to market conditions. The issuance will be denominated in euros, a currency the Kingdom is currently favoring over the US dollar. The capital raised will be used to fund structural reforms and infrastructure projects, particularly in preparation for the 2030 FIFA World Cup. This marks Morocco’s first return to international markets since 2023. Leading investment banks—BNP Paribas, Citigroup, JP Morgan, and Deutsche Bank—have been retained to manage the transaction.
What about prospects?
Moody’s projects medium-term GDP growth of 3.5%, driven by the ongoing implementation of structural economic and social reforms. Budget execution in 2024 slightly outperformed expectations, with revenue collections exceeding projections and the fiscal deficit estimated at 4.3% of GDP, compared to a target of 4.5%. Strong revenues from tourism, goods exports, and remittances have helped contain the current account deficit, which is projected at 2.5% of GDP in 2024, down from 0.6% in 2023. Moody’s evaluation incorporates several core metrics. Morocco’s economic strength, rated baa1, reflects its relatively low per capita income compared to peer economies, as well as its growth volatility due to climate-related vulnerabilities. This is partially offset by the gradual expansion of higher value-added sectors. Its institutional strength, rated baa2, is underpinned by strong institutions, a track record of effective macroeconomic policymaking, and a demonstrated commitment to fiscal discipline in the face of external pressures.
Fatim-Zahra TOHRY
