Morocco’s Economy Set to Grow 4.8% in 2021, Fitch Forecasts

If GDP rebounds by 4.8% in 2021, this upward trend should continue in 2022 at least, said the American rating agency Fitch, which believes that the establishment of the strategic investment fund "Fonds Mohammed VI pour l’investissement" can help economic recovery. Moreover, the agency has validated the "BB+" rating with a stable outlook for the kingdom. This rating is supported by good macroeconomic stability, a medium share of foreign currency debt and more or less good external liquidity.

Furthermore, external resilience is supported by "Morocco’s fairly comfortable foreign exchange reserves and greater exchange rate flexibility". In this sense, "we expect foreign exchange reserves to rise slowly in 2021 and 2022 after climbing to $32.2 billion at the end of 2020, compared to $25.3 billion in 2019. We expect foreign exchange reserves to cover 7.5 months of current external payments on average in 2021-2022, more than the ’BB’ median of 5.4 months," the rating agency added.

It also estimated that "public debt will increase to 68.8% of GDP in 2021 and 70.5% in 2022, compared to 66.8% in 2020, exceeding the projected ’BB’ median of 59.1% in 2022". Thus, the debt will regain its stability as of 2023. As for tourism, it will struggle to recover in 2021, the same source stressed.