Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's changes outlook on the Government of Morocco's Ba1 rating to positive from stable; ratings affirmed

24 Feb 2017

New York, February 24, 2017 -- Moody's Investors Service has today changed the outlook on the Government of Morocco's rating to positive from stable and affirmed the issuer and senior unsecured ratings at Ba1.

The key drivers of today's rating action are:

(1) Improving external position reflected in the build-up of foreign exchange reserves in the wake of dynamic new export industries and lower nominal oil imports;

(2) Declining fiscal imbalances, reflecting gradual but steady fiscal consolidation, supported by fuel subsidy and public pension reforms, which in turn increase the prospect of a gradual reduction in public-sector indebtedness.

Moody's decision to affirm Morocco's Ba1 rating balances an institutional environment, which is supportive of structural reforms, as illustrated by the country's industrialization and renewable energy strategy, against low wealth levels, a volatile and subdued growth pattern, and a comparatively high public debt stock relative to similarly rated peers. The Ba1 rating also captures Moody's political risk assessment, which is based on the delays in the formation of a new government following the elections in October last year, in addition to potential regional tensions related to the disputed Western Sahara territory.

Morocco's foreign- and local-currency ceilings remain unchanged, namely the long-term foreign-currency bond ceiling at Baa2, the long-term foreign-currency deposit ceiling at Ba2, and the long-term local-currency bond and deposit ceilings at Baa1. The short-term foreign-currency bank deposit ceiling remains unchanged at NP, and the short-term foreign-currency bond ceiling at P-2.

RATINGS RATIONALE

RATIONALE FOR CHANGING MOROCCO'S RATING OUTLOOK TO POSITIVE FROM STABLE

FIRST DRIVER: DYNAMIC NEW EXPORT INDUSTRIES AND LOWER NOMINAL OIL IMPORTS GRADUALLY IMPROVING THE COUNTRY'S EXTERNAL POSITION

The first driver for Moody's decision to change Morocco's rating outlook to positive is the country's improving external position in the wake of lower nominal oil imports and resilient export sectors, resulting in the build-up of a foreign-exchange buffer amounting to around 7 months of import cover at the end of 2016, up from 4.1 months at year-end 2012. As one of the most energy-import-dependent countries among Moody's-rated MENA sovereigns, Morocco is one of the main beneficiaries of the lower-for-longer oil price environment, which supports the preservation of the buffer over the forecast horizon. The forex buffer also represents a necessary precondition for the central bank's announced strategy to gradually move towards a flexible exchange rate system starting in the second half of 2017.

Morocco's export performance is supported by the diversification into higher value-added automotive, aeronautics and electronics sectors, which have together overtaken the more traditional exports in the phosphate, agriculture or textile sectors, and which continued to expand at double-digit rates in 2016. Moody's expects the country's export performance in these new sectors to remain dynamic in response to their increased integration in the global production chain.

The country's current account deficit has improved to an estimated 3.8% of GDP at the end of 2016 from a deficit of 9.5% in 2012. Moody's expects the current account deficit to remain around the 4% of GDP level over the forecast horizon, with oil prices projected to remain in the $40-$60 range. Morocco's relative political stability has also bolstered foreign direct investment (FDI) inflows, which are mainly geared towards the real estate and the industrial sectors, and which balance nascent FDI outflows toward sub-Saharan Africa in support of Morocco's regional trade diversification strategy. If sustained at current levels, Moody's expects that net FDI inflows will remain an important source of funding for the country's current account deficit, therefore limiting the build-up of external debt.

SECOND DRIVER: INSTITUTIONAL REFORMS LIKELY TO SUPPORT GRADUAL BUT STEADY FISCAL CONSOLIDATION

The second driver behind Moody's decision to change Morocco's rating outlook to positive is the country's improving fiscal performance, reflecting a gradual but steady pace of fiscal consolidation, which is in turn supported by institutional improvements that are likely to reduce implementation risks in the future. The fiscal deficit has declined steadily to 4.0% of GDP at the end of 2016 from 7.3% in 2012, driven mainly by the reduction in the energy subsidy bill to about 1.2% of GDP from 6.5% in 2012. While the slump in oil prices played an important role, the complete elimination of fuel subsidies and the introduction of an automatic pricing formula in late 2015 shields the deficit from expanding again with increasing oil prices. Looking ahead, Moody's believes that Morocco's fiscal deficit is likely to continue to contract. Provided there are no major setbacks, the continued shrinking of the fiscal deficit raises the prospect for the central government's debt-to-GDP ratio to begin trending downward as of this year and gradually move towards the 2020 60% target envisaged by the government.

Similarly, the parametric public-sector pension reform, which the Moroccan government enacted before the October 2016 elections, has improved the financial sustainability of the public-sector pension fund, thereby reducing pressures on the budget over the medium term. Other reform initiatives, which have been undertaken with the technical cooperation of the IMF under three consecutive Precautionary and Liquidity Line (PLL) programs since 2012, include the almost complete implementation of the organic budget law, the continued fiscal decentralization under the Advanced Regionalization program, in addition to tax reform with the objective of broadening the tax base, reducing exemptions and improving the business environment.

RATIONALE FOR AFFIRMING MOROCCO'S RATING AT Ba1

Moody's affirmation of Morocco's Ba1 government bond rating takes into account the continued progress in the country's industrialization strategy, which aims to increase the manufacturing share to 23% of GDP by 2020 from 16% currently, deepen its focus on renewable energy to reduce its energy import dependence, and expand the country's geographical trade diversification into sub-Saharan Africa.

At the same time, Morocco's rating reflects persistent structural constraints, combining low wealth levels with relatively subdued and volatile growth dynamics in comparison to peers because the county's agriculture sector continues to contribute a significant 13% of GDP as well as 40% of the labor force. The Ba1 rating also takes into account the comparatively high central government debt ratio of an estimated 64.8% of GDP in 2016, although the low foreign-currency share of the overall debt stock, and access to a large domestic funding base represent mitigating factors. As the main driver of event risk, the Moroccan banking sector's foray into sub-Saharan Africa represents both an opportunity to diversify and to expand its market share, as well as a challenge in terms of cross-border supervision and risk management.

The Ba1 rating affirmation also captures Moody's political risk assessment of Morocco, which takes account of delays in the formation of the new government following the elections in October last year, in addition to the potential for regional tensions related to the disputed Western Sahara territory.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward rating pressure would arise from increased evidence that the country's budgetary performance will be sufficiently robust in the coming years to firmly position the central government debt ratio on a downward trajectory, combined with a stabilization of debt guarantees from state-owned enterprises. A resolution of the political stalemate that would secure the maintenance of fiscal discipline and the reform momentum -- including the stated objective of easing the current currency peg in the second half of 2017 with the aim to moving to an inflation-targeting regime and easing capital controls over the medium term -- would also be credit supportive.

If the Moroccan government proved unable to control the deficit, the debt burden and debt guarantees this would increasingly limit Morocco's fiscal space and weigh on the country's credit profile over the medium term. A continued political stalemate or increased tensions with the Western Sahara territory would also be credit negative, as would an unforeseen deterioration in the external accounts due to a sharp and sustained spike in oil prices or as a result of the gradual transition to a flexible exchange rate system.

GDP per capita (PPP basis, US$): 8,180 (2015 Actual) (also known as Per Capita Income)

Real GDP growth (% change): 4.5% (2015 Actual) (also known as GDP Growth)

Inflation Rate (CPI, % change Dec/Dec): 0.6% (2015 Actual)

Gen. Gov. Financial Balance/GDP: -4.4% (2015 Actual) (also known as Fiscal Balance)

Current Account Balance/GDP: -2.1% (2015 Actual) (also known as External Balance)

External debt/GDP: 42.7% (2015 Actual)

Level of economic development: Moderate level of economic resilience

Default history: No default events (on bonds or loans) have been recorded since 1986.

On 21 February 2017, a rating committee was called to discuss the rating of Morocco, Government of. Other views raised included: The issuer's economic fundamentals, including its economic strength, have not materially changed. The issuer's institutional strength/framework, have increased. The issuer's fiscal or financial strength, including its debt profile, has not materially changed. The issuer's overall susceptibility to event risk has not materially changed.

The principal methodology used in these ratings was Sovereign Bond Ratings published in December 2016. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.

The weighting of all rating factors is described in the methodology used in this credit rating action, if applicable.

REGULATORY DISCLOSURE

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Elisa Parisi-Capone
Vice President - Senior Analyst
Sovereign Risk Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Yves Lemay
MD - Sovereign Risk
Sovereign Risk Group
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

No Related Data.
© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be reckless and inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or other professional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it fees ranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.