Morocco plans a return to the international debt market

It is whispered and stridently that Morocco is considering a return to the international debt market during the current financial year. The Kingdom could raise 25 billion dirhams or 2.5 billion dollars depending on the parity of the two currencies. A forced return one would say by the international context which strongly impacts the national economy.

The Kingdom could therefore tap into the international debt market around the time a previous $1.5 billion bond matures in December, we report. Bloomberg. These figures, reported by the financial information site Bloomberg, would aim to consolidate currency reserves in order to cope with a few months of imports.

But for the time being no decision has been made as to the size, name or maturity of the issue, the American financial group specializing in services for financial market professionals and in economic information and financial. ” Morocco can raise up to 25 billion dirhams ($2.5 billion) from creditors and international development institutions by the end of the year “, he specifies.

However, the increase in remittances from Moroccans living abroad and phosphate revenues remain a brake on a possible return to the international debt market. For the Moroccan executive, these revenues mitigate the impact of the high costs of increasingly expensive food and energy imports on the country’s finances in the short term. Also Bloomberg is pushing the deadline to the end of the current fiscal year to do this. As a reminder, Morocco’s last issue in this sense dates back to 2020.

The planned operation could therefore take place towards the end of the year. Morocco would thus consider a sale of sovereign bonds abroad of around 2.5 billion dollars, following the impact of the coronavirus health crisis on the country’s economy and finances and the current global context due to the conflict in Ukraine. This crisis situation, according to sources familiar with the matter quoted by the Bloomberg news site, should lead the country to rely more on international debt markets “.

This exit, if it takes place, should cause the country’s debt to jump from GDP in 2022, which would thwart many of the efforts made by the Kingdom, under the watchful eye of the IMF, to reduce the level of the Kingdom’s indebtedness, hence a certain difficulty over several exercises before stabilizing the ratio. That said, Morocco can afford not to bid if markets continue to demand high yields, Bloomberg concludes.

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