Mubasher: Moody's Investors Service has delivered stable outlook for most sovereigns in the Levant and North Africa in 2019 amid continued political and geopolitical risks in the region.
The New York-based financial services company has downgraded Tunisia’s rating to ‘B2’ in March, changing the outlook to negative from stable in October, which reflects the sovereign’s weakness in facing external challenges, Moody’s said in a recent report.
As for Morocco, the rating service firm stabilised its Ba1 rating outlook from positive in November, indicating “fiscal consolidation setbacks that delay the stabilisation and reduction of the public debt ratio”, according to the report.
Moreover, Lebanon’s B3 rating has been assigned with a negative outlook in December as risks to the government's liquidity position and the country's financial stability increased. However, Moody’s has downgraded Lebanon to Caa1, changing its outlook to stable this month.
On the other hand, the outlook of Egypt's B3 rating has been changed to positive from stable, reflecting improvements in the North African country’s economic growth supported by the International Monetary Fund’s (IMF) programme.
The report suggested the countries in the Levant and North Africa to reinforce economic ties with the GCC to “sustain tourism receipts and remittances in Jordan, Lebanon and Egypt”, the report said.
In Egypt, the government had to float the exchange rate in November 2016, which have improved its long-term growth, the report highlighted, adding that Morocco has turned to gradual exchange rate liberalization to support competitiveness.
Moody’s indicated that all governments in the region, except Lebanon, will maintain cutting fiscal deficits as part of IMF programmas.
