Fitch Downgrades Morocco’s Credit Rating Amid COVID-19 Economic Impact

The impact of the coronavirus pandemic on the Moroccan economy, as well as on public and external finances, justifies this rating, which was based on "the decline in budget revenues and the contraction of GDP combined with a mechanical increase in public debt, not to mention the impact on the current account." Fitch expects a budget deficit of 7.9% of GDP in 2020 and 6.5% in 2021, compared to 4.1% (excluding privatization revenues) in 2019.

With this rating, the government finds itself limited in its maneuvering room at several levels, especially when it comes to loans. Since the current Precautionary and Liquidity Line (PLL) is due to expire at the end of the year, the government hopes for a new IMF financial facility for the coming years.