Impact of the Coronavirus Disease Crisis on Businesses in Morocco: Constraints and Opportunities

The report titled “Impact of the coronavirus disease crisis on businesses in Morocco: constraints and opportunities” explores the economic ramifications of the COVID-19 pandemic on Moroccan businesses, focusing on the challenges faced and opportunities that arose during this period. The study is conducted by the Economic Commission for Africa, specifically targeting the North African business environment with a detailed survey of 1,000 Moroccan businesses from various sectors. This detailed analysis provides valuable insights into the specific challenges faced by Moroccan businesses during the pandemic and outlines strategic recommendations for navigating future economic uncertainties.

Key Findings:

• Economic Impact: The pandemic significantly impacted businesses, with 48% experiencing temporary closures averaging 7.3 weeks. This disruption varied across sectors, with services experiencing the highest turnover decline at 38.9% and industries at 33.3%. The accommodation, catering, and tourism sectors faced the steepest declines due to their reliance on external demand, which was severely disrupted.
• Employment Effects: Employment across various sectors dropped, with a 7.7% decrease in both industry and services. The accommodation and catering sector saw a 25.2% reduction in employment, marking the highest in the service sector.
• Financial Constraints: Access to finance became a growing challenge during the pandemic, with 22.2% of businesses in 2020 identifying it as a constraint, up from 12.3% in 2019. Businesses that reported financial constraints also experienced significant declines in turnover and employment.
• Assistance and Support: Approximately 47.5% of businesses received some form of assistance, predominantly salary subsidies. Analysis suggested that the study was not conclusive in demonstrating that these subsidies protected jobs, it shows that they mitigated turnover declines by approximately 4% (as estimated with the sample surveyed).
• Sector-Specific Impacts: The report details the specific impacts on various sectors, noting that small businesses and export-oriented firms faced diverse challenges. Export-oriented firms experienced less severe impacts on turnover and employment compared to local businesses.
• Future Outlook and Recommendations: The report highlights the importance of structural transformation and the enhancement of financial systems to support small and medium-sized enterprises (SMEs). It emphasizes the need for an education system responsive to the challenges posed by rapid technological and environmental changes that may trigger new crises in the future.
• Public Policy Implications: The report suggests that public policy should prioritize resilience and adaptability to handle future crises effectively. Investments in education and health are recommended as critical areas for government spending to bolster economic recovery and long-term stability.