S&P revises Morocco's economic outlook to negative

AP, Thursday 11 Oct 2012

Credit agency cites the kingdom's high deficit, slow reform and exposure to Europe's financial woes

The Standard & Poor's rating agency has revised Morocco's outlook downward to negative from stable because of a high deficit, Europe's financial crisis and lagging reforms.

The agency affirmed Thursday its BBB- credit rating for Morocco, which hovers just above junk bond status, but the negative outlook creates the possibility that a downgrade might be in the future.
With its economy buffeted by a poor harvest and debt crisis hurting its main European trading partners, Morocco has a budget deficit this year of 7 per cent of GDP.
The government pledged to enact reforms of ballooning social subsidies, but that could result in greater social unrest.
Morocco sought help from the International Monetary Fund in August, winning a $6.2 billion precautionary credit line.
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