S&P Global Ratings also points out that the Government has put in place measures aimed at alleviating the impact of inflationary pressures on the population, in particular:
- The suspension of customs duties on wheat;
- The establishment of a support system for professionals in the road transport sector;
- The emergency plan to support the agricultural sector;
- The opening of additional appropriations to cover compensation charges.
Another factor contributing to this rating is the fact that the government has started to reform the social security system in order to extend the coverage of health care and social transfers. Without forgetting the tax reform and that of the public enterprise sector.
S&P also highlights that the government has implemented business-friendly reforms aimed at prioritizing investments in green energy, digitalization and modernization of the legal, institutional and regulatory framework.
In terms of performance, the S&P rating covers the following elements:
- Good export performance;
- Good recovery in the tourism sector;
- Increase in transfers from Moroccans living abroad;
- Significant level of FDI;
- Adequate level of foreign exchange reserves;
Still listing the points that pleaded in favor of maintaining the rating, S&P notes the preservation of a favorable structure of the debt portfolio (more than 75% of the Government’s debt denominated in dirhams and less than 25% denominated in currencies assorted additionally concessional terms) with relatively limited exposure to interest rate, refinancing and currency risk.
Another element is the gradual fiscal consolidation supported by the implementation of reforms;
According to S&P, Morocco has relatively solid growth prospects supported by the ongoing structural reforms and the profound transformation of the structure of the economy, which is supported by a significant level of FDI and the expansion of export capacity. , thanks to the government’s strategy aimed at promoting private sector activity, the formalization of the informal economy and the implementation of socio-economic reforms.
