S&P Keeps Morocco, Ghana Ratings Stable Amid Global Uncertainties

S&P Global has upheld the sovereign credit ratings of Ghana and Morocco, assigning both a stable outlook despite escalating US-Israel-Iran tensions driving global uncertainty and inflation.

On Friday, the agency confirmed Ghana’s long- and short-term foreign and local currency ratings at ‘B-/B’, while Morocco’s stood at ‘BBB-/A-3’—both with stable outlooks.

For Morocco, S&P highlighted robust structural reforms boosting GDP growth, diversification, and fiscal gains, offset by Middle East conflict risks, low GDP per capita, high unemployment, and climate vulnerabilities.

“The stable outlook balances these strengths against significant uncertainty,” the report stated.
Ghana’s outlook reflects advancing external and fiscal metrics from reforms, tempered by high debt costs, execution hurdles, and commodity swings in gold, cocoa, and oil—echoing challenges in Nigeria’s oil-dependent economy.

Morocco Faces Energy Import Risks from Middle East Fallout
Morocco risks higher energy import bills, supply disruptions, and softer external demand from the conflict.

Despite renewable progress, it imports most hydrocarbons, exposing it to price shocks. Fiscal relief for households could delay consolidation, with Europe’s demand key to performance.
Downside threats include sulfur supply hits for fertilizers if the Strait of Hormuz closes—phosphates made up 21.3 per cent of exports last year. OCP Group, holding 70 per cent of global reserves and a third of exports, eyes doubling output by 2030, fueled by US demand.

Yet Morocco’s growth shines: real GDP is forecast at 4.4 per cent annually through 2029, after 4.8 per cent in 2025 from mining, agriculture, construction, manufacturing, and power.
Better rains aided farming recovery; tourism hit 20 million visitors (up 14 per cent); investment surged 17 per cent.
Pro-business moves, a new investment charter, and the Mohammed VI Fund will propel automotive, aerospace, phosphates, ICT, and tourism.

For Ghana, the stable outlook reflects a balance between improving external and fiscal metrics—driven by ongoing reforms—and persistent risks, including high debt service costs, implementation challenges, and exposure to commodity price volatility, particularly gold, cocoa, and oil.

S&P noted that Morocco remains exposed to spillovers from the Middle East conflict through higher energy import costs, potential supply disruptions, and weaker external demand. Despite progress in renewable energy, the country continues to import a significant share of its hydrocarbon needs, leaving it vulnerable to price shocks.

Fiscal measures aimed at cushioning households and businesses from inflation could slow the pace of fiscal consolidation. In addition, Morocco’s economic performance remains closely tied to demand from key trading partners, particularly in Europe.

The firm also highlighted downside risks from disruptions to sulfur supplies—critical for fertilizer production—particularly if the Strait of Hormuz is affected. Phosphates and related products accounted for 21.3 percent of Morocco’s goods exports last year. It noted that OCP Group, which controls about 70 percent of global phosphate reserves and roughly one-third of exports, plans to double production by 2030, supported in part by rising demand from the US.

Growth outlook strengthened by investment, tourism
The North African nation’s growth outlook remains robust, with real GDP projected to average 4.4 percent between 2026 and 2029, following stronger-than-expected performance in 2025. Improved rainfall has boosted water reserves, supporting a recovery in agricultural output after years of drought.

More broadly, sound macroeconomic policies, strong export performance—particularly in tourism—and rising foreign direct investment have strengthened external buffers. Fiscal reforms are also supporting revenue growth, enhancing the government’s ability to manage external shocks.

Last year, the economy exceeded expectations, with real GDP growth estimated at 4.8 percent, driven by strong performance across mining, agriculture, construction, manufacturing, and power generation. Lower interest rates and subdued inflation supported consumption and investment, with the latter rising 17 percent year-on-year.

Looking ahead, growth will be supported by pro-business reforms, the new investment charter, and the Mohammed VI Investment Fund. Key sectors—including automotive, aerospace, construction, phosphates, and ICT—are expected to drive expansion, alongside continued strength in tourism. The country welcomed nearly 20 million tourists in 2025, up 14 percent year-on-year.

Ghana: Reforms and gold boost external position
Meanwhile, Ghana is nearing completion of its comprehensive debt restructuring following its 2022 default. The government has restructured domestic debt and $13.1 billion in Eurobonds, with agreements in principle covering about 97 percent of eligible debt.

“We understand the government has either completed restructuring or reached agreements in principle on close to 97 percent of debt within the restructuring perimeter,” S&P said.

Progress has also been made in negotiations with the African Export-Import Bank and holders of Saderea commercial notes, helping to resolve earlier disagreements among creditors. Improved terms of trade—particularly elevated gold prices—have strengthened the West African nation’s external position. The country recorded a current account surplus of $9.35 billion (8.1 percent of GDP) in 2025, while foreign reserves rose to a record $14.5 billion.

With Middle East tensions affecting traditional refining routes, Ghana is increasingly diversifying gold export destinations beyond Dubai to markets such as India.

The new administration, which assumed office in December 2024, has introduced fiscal rules aimed at preventing slippages, including a targeted primary surplus of 1.5 percent of GDP and a medium-term goal of reducing debt to 45 percent of GDP by 2034.

Despite these gains, S&P said the rating for Africa’s biggest gold producer remains constrained by weak—though improving—institutional capacity and high debt servicing costs. The economy also remains vulnerable to external shocks and climate risks, given its reliance on agriculture and gold exports.

While growth reached six percent in 2025, supported by improved macroeconomic stability, risks remain. A potential decline in gold prices or rising fertilizer costs linked to geopolitical tensions could weigh on exports, agricultural output, and inflation.

“We expect inflationary pressures to increase moderately this year but remain more contained than in recent years, supported by improving monetary policy credibility,” S&P said. However, inflation is projected to remain at the upper end of the Bank of Ghana’s 6–10 percent target range through 2029, with exchange rate stability seen as critical to anchoring expectations.