HIBAPRESS
The Ministry of Economy and Finance revealed that the credit rating agency "Moody's Ratings" decided to raise the future outlook associated with Morocco's credit rating from "Stable" to "Positive," while maintaining the rating at the "Ba1" level, for long-term debt issuances in foreign and local currencies.
The Ministry stated, in a statement, that the "Moody's" evaluation report considered that these positive prospects reflect the gradual improvement in the robustness of the Moroccan economy and its financial situation, which strengthens the Kingdom's credit file and strengthens the chances of raising its rating in the future if this positive dynamic continues. According to the agency, the review of the outlook is primarily based on the improvement in economic growth expectations, supported by rising investment levels and the continued implementation of structural reforms aimed at transforming the structure of the economy and enhancing its growth potential in the medium term. Although the level of per capita income in Morocco is still lower compared to countries with higher ratings, "Moody's" confirmed that the combination of more sustainable economic growth with increasing diversification in the economic base and high investment levels indicates a structural improvement in the growth model in the Kingdom. The agency specifically noted the steady acceleration of non-agricultural growth in recent years, expecting it to exceed 5 percent by 2025, which reflects a reduced degree of dependence on volatile agricultural production and opens the way for achieving more stable and predictable economic growth. "Moody's" also expected the continuation of the growth momentum at a relatively high pace, supported by large public and private investments, especially in the fields of transport, logistics, energy, and water, in addition to the continuation of reforms aimed at improving the business climate and attracting more investments. The report pointed out that these major projects will contribute to strengthening logistical connectivity and mitigating some climate-related constraints, as well as supporting the competitiveness of the national economy, while industrial policies continue to play an important role in developing high value-added sectors and enhancing the Kingdom's export capabilities. On the financial side, the agency considered that the improvement in budgetary performance is a supporting factor for these positive prospects, as it contributes to containing the debt burden in the medium term, despite the continued pressures associated with the rise in social expenditures and investment needs. "Moody's" added that strengthening the mobilization of tax resources, directing social expenditures in a more targeted manner, along with reforming the public enterprise sector and diversifying sources of financing for major projects, are essential elements for enhancing the sustainability of public finances. The report concluded that maintaining the rating at the "Ba1" level reflects the strength of institutions and governance in Morocco, along with the continued diversification of its economy, praising the prudent management of macroeconomic policies, the availability of comfortable foreign currency reserves, as well as the Kingdom's ability to smoothly access local and international financial markets. In contrast, the agency pointed out that some factors still put pressure on the rating, including the relative level of per capita income, exposure to climate shocks, in addition to the potential risks associated with public enterprises and the banking system. The statement confirmed that the improvement in the growth outlook and the continuation of a prudent financial policy will enhance the confidence of international institutions in Morocco's ability to face these challenges, while maintaining a sufficient budgetary margin to respond to social needs and the requirements of development investments.
