Standard & Poor’s has raised Morocco’s sovereign credit rating to BBB-/A-3, restoring the kingdom’s “investment grade” status for the first time since 2021.
The upgrade, from +B/BB, reflects Morocco’s resilient economy and solid macroeconomic fundamentals, the ratings agency said in a report Thursday. It credited ongoing reforms under King Mohammed VI’s leadership and the country’s ability to weather global trade disruptions and U.S. tariffs.
S&P projects Morocco’s real GDP will grow an average of 4% annually between 2025 and 2028, supported by infrastructure projects for the 2025 Africa Cup of Nations and the 2030 World Cup, as well as investments in energy, health, and transport.
The report noted that Morocco’s budget deficit is expected to narrow to 3% of GDP by 2026 and public debt should gradually decline. The current account deficit is forecast to stay manageable at around 2.1% of GDP through 2028.
Still, the agency cautioned that climate change could weigh on agriculture, a sector central to Morocco’s economy, while regional disparities, high unemployment, and exposure to geopolitical tensions remain challenges.
The upgrade is expected to lower borrowing costs, boost investor confidence, and attract more foreign direct investment. S&P said the rating could climb further if financial performance outpaces forecasts or if Morocco adopts a more flexible exchange rate. Conversely, it could fall again if fiscal discipline weakens or external conditions deteriorate.
Economic data for the first half of 2025 has been encouraging. GDP grew 4.8% year-on-year in the first quarter, led by construction, industry, tourism, IT, agriculture, and phosphate production. Unemployment edged down to 12.8% in June, while tourism revenues rose 19% in the second quarter.
Inflation remains moderate at about 2.1%, with the central bank maintaining an accommodative policy stance. Fiscal revenues climbed from 200 billion dirhams ($19.7 billion) in 2020 to 300 billion dirhams in 2024, thanks to tax reforms and expanded social programs, including the national health coverage plan.
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