Fitch maintains the rating of sovereign issues – The Economist

“We expect in Morocco an acceleration of economic growth in 2015 due to a good agricultural season and ongoing consolidation of twin deficits this year and au beyond, “says Amélie Roux, an analyst at Fitch Ratings (Ph. FR)

The Moroccan sovereign issues are shaped, according to Fitch Ratings rating agency. His last delivery up sovereign bonds of the Kingdom in “investment grade”. “Morocco has an economic, budgetary and external performance in line with sovereigns rated in the same rating category, despite lower development and governance indicators,” says Amélie Roux at The Economist, an analyst at Fitch Ratings. The rating agency confirmed the “BBB-” and “BBB” respectively for the long-term sovereign bonds in foreign and local currency with a stable outlook. The acceptable debt ceiling has also assigned a “BBB”. A rating of “F3″ has been allocated to the foreign currency short-term debt. Remember, the “BBB” level and “F3″ estimated average solvency by investors.
Fall Fitch analysts that despite the moderate growth in non-agricultural sectors as a result of lower activity tourism and phosphate, GDP growth should be around 4.6% in 2015, boosted mainly by good orientation of agricultural mate. “Prospects for development of manufacturing are favorable considering the rise of new industries,” notes the recent note of the international agency. It is true that the textile / clothing sector has shown signs of slowing over the last 10 years. However, this excitement is offset by the rise of the automobile and transport equipment in the contribution to value added. Their share, although it remains modest, almost doubled over the same period.
Most of the public finance indicators are in line with the ‘BBB’ median. Analysts estimate that the general government debt, which stood at 49.1% of GDP at end 2014, peaked in 2014 and expect that it decreases gradually in parallel with the targets set in the budget deficit. “We estimate that the fiscal deficit of the central government gradually reduced to 3% of GDP in 2017, resulting in a gradual reduction of the public debt by 2015,” says Amélie Roux. The rate of 4.3% targeted by the government deficit in 2015 was considered “credible”. This trend is confirmed by recent public finance figures which show a budget deficit down compared to last year. At the end of August, it stood at 30.6 billion dirhams against 39.9 billion a year earlier. A fiscal consolidation mainly due to the improvement in investment spending. The agency noted that Morocco stands out regionally by its political stability, a factor of attractiveness, reassuring for foreign investors. In addition, the line Precautionary and Liquidity (LPL) was recently renewed with the IMF for a budget of $ 5 billion, equivalent to 5% of GDP in 2014. The program is viewed by Fitch as a “security guarantee” against the crisis in the balance of payments.
In addition, the agency notes that the main weaknesses of Morocco come from indicators of development and inefficient governance, which are assigned a rating “BB”. A qualified level of “non-investment grade”.

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