Fitch: Framework in Morocco is key

Fitch Ratings said in a special report that the institutional framework of Moroccan subnationals has been a key element in maintaining overall debt at moderate levels and underpinning their creditworthiness.

Key strengths include the close supervision by the Ministry of Domestic Affairs and the Ministry of Finance of all budgetary and financial decisions, clear public lending guidelines set by the Fonds d'Equipement Communal, a public agency that is almost the sole lender to Moroccan local governments and reluctance among local governments to resort to the lending market, Fitch said.

The sound credit quality of local governments is therefore mainly due to their moderate recourse to debt and the highly centralized nature of their debt management when debt is raised, the agency said.

© 2015 Prospect News.
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