Moody’s rating agency maintained Morocco’s “Ba1” credit rating due to its ability to access external and domestic financing on favorable terms. While Morocco’s rating has been confirmed, its outlook has nevertheless changed from “stable” to “negative”.
This ability to obtain financing allows the kingdom to meet higher gross borrowing needs, recalls the rating agency. Regarding the downward revision of the outlook, it demonstrates the impact, in the medium term, of the Covid-19 pandemic on the Kingdom’s budgetary solidity, especially given a less vigorous than expected economic recovery, and the exposure of the Moroccan economy to sectors and trading partners hit hard by the crisis, Moody’s clarified.
According to the rating agency, the still low prices of energy products, and a “strong cushion of foreign exchange reserve” should limit the risks of external vulnerability. As for the outlook, the agency forecasts a gradual reduction of the budget deficit to 6.5% of GDP in 2021, and 4.5% in 2022 (compared to 7.5% in 2020).