MOROCCO ECONOMIC MONITOR - From Relief to Recovery Fall 2020 - World Bank Document
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Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
Middle East and North Africa Region
Fall 2020
to Recovery
From Relief
MONITOR
MOROCCO ECONOMIC
Morocco
Economic Monitor
From Relief to Recovery
With a Special Focus on
COVID-19 and the Moroccan Formal Private Sector
Fall 2020
MOROCCO ECONOM
MONITO
Middle East and North Africa Region
From R
© 2020 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org This work is a product of the staff of The World Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy, completeness, or currency of the data included in this work and does not assume responsibility for any errors, omissions, or discrepancies in the information, or liability with respect to the use of or failure to use the information, methods, processes, or conclusions set forth. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Nothing herein shall constitute or be construed or considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. Rights and Permissions The material in this work is subject to copyright. Because The World Bank encourages dissemination of its knowledge, this work may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given. Any queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@worldbank.org. Cover photos used with the permission of Anne-Lucie Lefebvre. Publication design and layout by The Word Express, Inc.
TABLE OF CONTENT
Acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
Resume Synthétique . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi
امللخص التنفيذي. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii
1. Recent Economic Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Epidemiological Developments: A Tale of Two Waves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
A Recession of Historical Proportions Puts an End to more than Two Decades
of Sustained Economic Expansion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The COVID-19 Shock is Adding Pressure on Morocco’s Budget Deficit, but the Current Account
is Behaving Better than Anticipated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
2. Outlook and Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Morocco’s Economic Policy Response to the Pandemic: From Relief to Recovery . . . . . . . . . . . . . . . . . . . . . .9
Outlook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Special Focus: COVID-19 and the Moroccan Formal Private Sector . . . . . . . . . . . . . . . . . . . . . . . 17
How have Morocco’s Firms Coped with the COVID-19 Crisis? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Maintaining the Reform Momentum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Data Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
Selected Recent World Bank Publications on Morocco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
iiiList of Figures
Figure 1 Epidemiological Situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Figure 2 Government Response Stringency Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Figure 3 Morocco Mobility Data (% change from pre-COVID-19 baseline) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Figure 4 GDP: Decreasing Demand (y-o-y %) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 5 GDP: Uneven Impact of the Crisis on the Supply Side (y-o-y %) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 6 Increasing Unemployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 7 Loss of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 8 The Statistical Capacity Indicator (SCI) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Figure 9 SCI Sub-components, Morocco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Figure 10 Slow Recovery for Q3 and Q4 2020 (y-o-y %) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Figure 11 Absence of Price Pressures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Figure 12 Decreasing Revenues (y-o-y %) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Figure 13 Rising Central Government Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Figure 14 Current Transactions (y-o-y % changes) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Figure 15 Stable Gross Official Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Figure 16 No Pressure on the Exchange Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Figure 17 Policy Response, Selected Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Figure 18 Bank Credit for Firms (% y-o-y change) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Figure 19 Interest Rate on Corporate Credit (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Figure 20 Cumulative Output Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Figure 21 Percent of Firms Confirmed Permanently Closed since COVID-19 (percent) . . . . . . . . . . . . . . . . . 18
Figure 22 Breakdown of Closed Firms (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Figure 23 Manufacturing Capacity Utilization Loss due to COVID19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
Figure 24 Impact of the Pandemic on Firms’ Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Figure 25 Percent of Firms that Received/Expect to Receive National or
Local Government Assistance – Breakdown . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Figure 26 Coverage Rate of Government Assistance (% out of the total of firms that received
government assistance) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
Figure 27 Sources of Financing for Cash Flow Shortages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
Figure 28 Impact of the Pandemic on Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Figure 29 Merchandise Trade (%of GDP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Figure 30 Morocco’s Participation in GVCs (% of gross exports) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
List of Tables
Table 1 Morocco: Selected Economic Indicators, 2016–2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Table 2 Morocco: Key Fiscal Indicators 2015–2022 (in percent of GDP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
List of Boxes
Box 1 Morocco’s Statistical Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Box 2 Review of the Main Mitigation Measures Adopted during Morocco’s Lockdown . . . . . . . . . . . . . . 10
Box 3 National Policies to Transition to a More Sophisticated Participation in GVCs . . . . . . . . . . . . . . . . 24
iv MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYACRONYMS
BAM Bank Al-Maghrib IMF International Monetary Fund
CAB Current Account Balance IOM International Organization for Migration
CPI Consumer Price Index LAC Latin America and Caribbean
COVID Coronavirus Disease LPI Logistics Performance Index
DSA Debt Sustainability Analysis MENA Middle East North Africa
DB Doing Business MoF Ministry of Finance
ECA Europe and Central Asia MSME Micro Small Medium Enterprises
EMDEs Emerging Market Developing Economies NGO Non-Government Organization
EAP East Asia and Pacific NPLs Non-Performing Loans
EU European Union PP Percentage Point
FDI Foreign Direct Investment PPE Personal Protective Equipment
FTA Free Trade Agreements PPP Public-Private Partnership
GCC Gulf Cooperation Council SA South Asia
GDP Gross Domestic Product SME Small Medium Enterprises
GoM Government of Morocco SOEs State-Owned Enterprises
GVC Global Value chains VAT Value-Added Tax
HCP High Comission of Planning WBG World Bank Group
HDI Human Development Index WDI World Development Indicators
ICT Information and Communications WGI Worldwide Governance Indicators
Technology
vPREFACE
T
he Morocco Economic Monitor is a semi- team is very grateful for the helpful inputs received
annual report from the World Bank economic from Matina Deen on the impact of the crisis on the
team on recent economic developments and corporate sector, from Vasco Molini on Morocco’s
economic policies. This report presents our current statistical capacity, and from Gabriel Sensenbrenner
outlook for Morocco given the recent COVID-19 (EFI Program Leader, Maghreb), as well as senior
developments. Its coverage ranges from the macro- staff from the Ministry of Finance. Special thanks to
economy to business environment and private sector Muna Salim (Senior Program Assistant, MTI) for her
development. It is intended for a wide audience, administrative support.
including policy makers, business leaders, financial The findings, interpretations, and conclusions
market participants, and the community of analysts expressed in this Monitor are those of World Bank
and professionals engaged in Morocco. staff and do not necessarily reflect the views of the
The Morocco Economic Monitor is a product Executive Board of the World Bank or the governments
of the Middle East and North Africa (MENA) unit in the they represent. For information about the World
Macroeconomics, Trade & Investment (MTI) Global Bank and its activities in Morocco, please visit www.
Practice in the World Bank Group. The report was led worldbank.org/en/country/morocco (English), www.
by Javier Díaz-Cassou (Senior Economist, MTI) and worldbank.org/ar/country/morocco (Arabic), or www.
Amina Iraqi (Economist, MTI). banquemondiale.org/fr/country/morocco (French).
The report was prepared under the direction of For questions and comments on the content of this
Jesko Hentschel (Country Director for the Maghreb), publication, please contact Javier Díaz-Cassou
and Eric Le Borgne (Practice Manager, MTI). The (jdiazcassou@worldbank.org).
viiEXECUTIVE SUMMARY
T
he COVID-19 pandemic has abruptly As in much of the world, the current
interrupted more than two decades of crisis will lead to a considerable increase in
sustained socio-economic progress in indebtedness. Tax revenues have collapsed, and
Morocco. In 2020 the country will suffer its first public spending has been crucial to confront the
recession since mid-1990s, and the economic health emergency and to sustain households’
contraction registered in the second quarter income. This has understandably put an end to the
(broadly coinciding with the confinement) is the fiscal consolidation efforts of the past few years, and
largest on record. This is the result of the combined we now project the public deficit to increase to 7.8
supply, demand and external shocks triggered by percent GDP in 2020 and public debt to reach 76
the pandemic, but also of the effects of adverse percent of GDP. The current account deficit is also
weather conditions on agricultural output. The crisis expected to increase to 6 percent of GDP this year.
is having a severe impact on jobs and household Despite the severity of the crisis, Morocco is better
incomes, generating a spike in unemployment placed than other emerging economies to weather
and a deterioration of poverty and vulnerability this storm thanks to the credibility of its macro-fiscal
indicators. framework, to its relatively large external buffers and
Although the Moroccan economy exhibits to its good access to international financial markets.
some signs of recovery, the situation remains The Moroccan authorities have put forward
fragile given that epidemiological trends are an ambitious recovery strategy. The government
worse now than they were during the first wave intends to mobilize close to 11 percent of GDP in the
of contagions. Although the economy is still form of loan guarantees, direct equity injections in
contracting, the last few months have witnessed a Moroccan corporates, and to give a new impulse to
partial recovery of mobility indicators, and certain infrastructure-related Public-Private-Partnerships. To
exports have resumed their pre-pandemic expansion. this end, a new strategic investment fund is being
However, after a relatively mild first wave, the number created, and the Central Guarantee Agency is being
of contagions began to pick up in the aftermath of the transformed into a limited company. In addition, various
confinement, and Morocco is now struggling to flatten important structural reforms have been announced,
the curve and reduce the pressure of COVID-19 on including the generalization of health insurance, a
its health system. In this uncertain context, we expect revamping of the social protection system around a
real GDP to contract by 6.3 percent in 2020, and to universalization of family allowances, the streamlining
return to its pre-pandemic level only in 2022. of Morocco’s large network of State-Owned Enterprises
ix(SOEs) and a number of measures to especially Going forward, the current crisis provides a
support the SME sector in the recovery. window of opportunity to remove the constraints
The follow-up Enterprise Survey conducted that in the past have limited the development of
by the World Bank in Morocco after the outbreak, a more dynamic private sector. In the short run,
provides new evidence on the large and persistent using all available policy space to inject liquidity
impact that the COVID-19 pandemic is having on the and equity into the private sector is still essential to
formal private sector. Among its most relevant results, prevent liquidity problems from turning into a wave of
6.1 percent of surveyed formal sector firms are reported corporate insolvency. With a longer-term perspective,
to have ceased their operations, and as many as 86.9 Morocco could stimulate competition and level the
percent report a fall in sales of, on average, 50.4 percent playing field for new entrants in goods and services
of their pre-pandemic level. The survey also provides markets, while upgrading its human capital and
information about the coping strategies of Moroccan institutional frameworks. In addition, appropriate
enterprises, which includes a growing use of the industrial policies would help to consolidate Morocco’s
government’s lines of support, a reduction in the number position as a nearshoring destination for multinational
of worked hours (but, comparatively, less lay-offs than in companies and thus to take advantage of the strategic
other countries), the use of internal funds to meet cash opportunities that could emerge globally in the post-
flow shortages, and increasing business activity online. pandemic world.
x MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYRESUME SYNTHÉTIQUE
L
a pandémie du COVID-19 a brusquement qu’un retour au niveau préalable à la pandémie ne
interrompu plus de deux décennies de devrait pas intervenir avant 2022.
progrès socio-économique soutenus au Comme dans une grande partie du monde,
Maroc. En 2020, le pays devrait subir sa première la crise actuelle entraînera une augmentation
récession depuis les années 1990, et la contraction considérable de l’endettement. Les recettes
économique qui a eu lieu au deuxième trimestre fiscales ont chuté et les dépenses publiques ont
(coïncidant largement avec le confinement) est la plus été cruciales pour faire face à l’urgence sanitaire
importante jamais enregistrée. C’est le résultat de la et soutenir les revenus des ménages. Cela a
combinaison des chocs de l’offre et de la demande naturellement mis fin aux efforts d’assainissement
et des chocs externes provoqués par la pandémie, budgétaire des dernières années, et nous prévoyons
mais aussi des effets que des conditions climatiques une augmentation du déficit budgétaire à 7,8 pour
défavorables ont eu sur la production agricole. La cent du PIB en 2020 et la dette publique devrait
crise a eu un impact sévère sur les emplois et les dépasser 76 pour cent du PIB. Le déficit du compte
revenus des ménages, générant le pic du chômage courant devrait également augmenter pour atteindre
et une détérioration des indicateurs de pauvreté et de 6 pour cent du PIB cette année. Malgré la gravité
vulnérabilité. de la crise, le Maroc est mieux placé que d’autres
Bien que l’économie marocaine montre économies émergentes pour résister à cette tempête
quelques signes de reprise, la situation reste grâce à la crédibilité de son cadre macro-budgétaire,
fragile étant donné la dégradation récente de la à ses tampons extérieurs relativement importants et à
situation épidémiologique. Bien que l’économie son accès aisé aux marchés financiers internationaux.
continue de se contracter, les derniers mois ont connu Les autorités marocaines ont une stratégie
une reprise partielle des indicateurs de mobilité, et de relance ambitieuse. Le gouvernement mobiliser
certaines exportations ont repris leur expansion pré- près de 11 pour cent du PIB sous forme de prêts
pandémique. Cependant, après une première vague garantis, capitaux entreprises marocaines et une
relativement modérée, le nombre de contagions a nouvelle impulsion aux partenariats publics-privés
commencé à augmenter à la suite du déconfinement, liés aux infrastructures. A cet effet, un nouveau fonds
et le Maroc a maintenant du mal à aplanir la courbe et d’investissement stratégique est en cours de création
réduire la pression du COVID-19 sur son système de et la Caisse Centrale de Garantie se transformera
santé. Dans ce contexte incertain, une contraction du en société anonyme. En outre, diverses réformes
PIB réel de 6,3 pour cent est prévue en 2020 tandis structurelles importantes ont été annoncées,
xinotamment la généralisation de l’assurance maladie, de trésorerie et un accroissement de l’activité du
une refonte du système de protection sociale autour commerce en ligne.
d’une universalisation des allocations familiales, À l›avenir, la crise actuelle ouvre une fenêtre
la rationalisation du vaste réseau des entreprises d’opportunité pour éliminer les contraintes qui,
publiques et un certain nombre de mesures pour dans le passé, ont limité le développement d’un
soutenir le secteur des PME dans la reprise. secteur privé plus dynamique. Dans le court terme,
L’enquête auprès des entreprises menée l’utilisation de tout espace politique disponible pour
par la Banque mondiale au Maroc fournit de injecter des fonds et des capitaux propres dans le
nouveaux éléments sur l’impact important et secteur privé est toujours indispensable afin d’éviter
persistant de la pandémie du COVID-19 sur le que les problèmes de liquidité ne se transforment
secteur privé formel. Parmi ses résultats les plus en une vague d’insolvabilité des entreprises. Dans
pertinents, 6,1 pour cent des entreprises du secteur une perspective à plus long terme, le Maroc pourrait
formel auraient cessé leurs activités et 86,9 pour cent stimuler la concurrence et instaurer des conditions
signalent une baisse des ventes de 50,4 pour cent en équitables pour les nouveaux entrants sur les
moyenne par rapport à leur niveau pré-pandémique. marchés des biens et services, tout en améliorant
L’enquête fournit également des informations sur les son capital humain et ses cadres institutionnels.
stratégies d’adaptation des entreprises marocaines, En outre, les politiques industrielles appropriées
qui incluent une utilisation croissante des lignes de contribueraient à consolider la position du Maroc en
soutien du gouvernement, une réduction du nombre tant que destination nearshoring pour les entreprises
d’heures travaillées (mais moins de licenciements multinationales et ainsi tirer parti des opportunités
en comparaison avec d’autres pays), l’utilisation stratégiques qui pourraient émerger globalement
de fonds internes pour faire face aux pénuries dans le monde post-pandémie.
xii MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYالملخص التنفيذي
قد أدى وباء كوفيد -19إىل توقف بشكل مفاجئ ألكرث من عقدين من وضع أفضل من االقتصادات الناشئة األخرى ملواجهة هذه العاصفة بفضل
التقدم االجتامعي واالقتصادي املستمر يف املغرب .يف عام ،٢٠٢٠من مصداقية إطاره املايل وآلياته العازلة الخارجية الكبرية نسبيًا و إمكانية
املتوقع أن تشهد البالد أول ركود لها منذ منتصف التسعينات ،واالنكامش الوصول إىل األسواق املالية الدولية.
االقتصادي املسجل يف الربع الثاين (الذي يتزامن إىل حد كبري مع الحجر
صحي) هو األكرب عىل اإلطالق .إن هذا ناتج عن مزيج بني صدمات اقرتحت السلطات املغربية اسرتاتيجية إنعاش طموحة .تعتزم الحكومة
العرض والطلب والصدمات الخارجية التي سببها الوباء ،ولكن أيضً ا تخصيص ما يقرب من ١١يف املائة من الناتج املحيل اإلجاميل يف شكل
نتيجة تأثري الظروف املناخية غري املواتية عىل اإلنتاج الزراعي .كان لألزمة قروض مضمونة ،وضخ رأس املال املبارش يف الرشكات املغربية ،وتعزيز
تأثري كبريعىل الوظائف ودخل األرسة ،مام أدى إىل ارتفاع معدل البطالة الرشاكة بني القطاعني العام والخاص املرتبطة بالبنية التحتية .ولهذه
إىل الذروة وتفاقم مؤرشات الفقر والضعف. الغاية ،يتم إنشاء صندوق استثامر اسرتاتيجي جديد وتحويل صندوق
الضامن املركزي إىل رشكة عامة محدودة .باإلضافة إىل ذلك ،تم اإلعالن
عىل الرغم من أن االقتصاد املغريب أظهر بعض بوادر االنتعاش ،إال أن عن العديد من اإلصالحات الهيكلية الهامة ،مبا يف ذلك بذل تعميم
الوضع ال يزال هشً ا حيث أن االتجاهات الوبائية األخرية أسوأ مقارنة التأمني الصحي ،إصالح نظام الحامية االجتامعية حول تعميم التعويضات
باملوجة األوىل من العدوى .عىل الرغم من استمرار االقتصاد يف االنكامش ، العائلية ،وترشيد الشبكة الواسعة من الرشكات العامة املغربية.
شهدت األشهر القليلة املاضية انتعاشً ا جزئ ًيا يف مؤرشات التنقل ،واستأنفت
بعض الصادرات توسعها قبل انتشار الوباء .ومع ذلك ،بعد املوجة األوىل تقدم الدراسة االستقصائية لدى الرشكات التي أجراها البنك الدويل
املعتدلة نسب ًيا ،بدأ عدد اإلصابات يف االزدياد مبارشة بعد رفع تدابري يف املغرب رؤى جديدة حول التأثري الكبري واملستمر لوباء كوفيد -19
تدابري الحجر الصحي ،ويكافح املغرب اآلن لتسوية املنحنى وتقليل ضغط عىل القطاع الخاص .من بني أكرث النتائج األكرث أهمية ١ ،٦ ،يف املائة
كوفيد -19عىل نظامه الصحي .يف ظل هذه الخلفية غري املؤكدة ،نتوقع من الرشكات التي شملها االستطالع قد توقفت عن العمل و ٩، ٨٦يف
أن ينكمش إجاميل الناتج املحيل الحقيقي بنسبة ٣، ٦يف املائة يف عام املائة أبلغت عن انخفاض بنسبة ٤ ،٠ ٥يف املائة يف املتوسط يف املبيعات
٢٠٢٠وأن يعود إىل مستويات ما قبل الجائحة حتى عام .٢٠٢٢ مقارنة مع مستوى ما قبل الوباء .يوفر االستطالع أيضً ا معلومات عن
اسرتاتيجيات التكيف للرشكات املغربية ،والتي تشمل زيادة استخدام
كام هو الحال يف كثري من أنحاء العامل ،ستؤدي األزمة الحالية إىل زيادة خطوط الدعم الحكومية ،تقليل عدد ساعات العمل (ولكن عدد ترسيح
كبرية يف الديون .انخفضت اإليرادات الرضيبية وكان اإلنفاق العام حاسامً العامل أقل مقارنة بالدول األخرى) ،استخدام املوارد الداخلية للتعامل
يف معالجة الطوارئ الصحية ودعم دخول األرس .و قد أنهى هذا جهود مع النقص النقدي وزيادة نشاط التجارة اإللكرتونية.
ضبط أوضاع املالية العامة يف السنوات القليلة املاضية ،ونتوقع أن يرتفع
عجز املوازنة إىل ٨، ٧يف املائة من إجاميل الناتج املحيل يف عام ٢٠٢٠ يف املستقبل ،تفتح األزمة الحالية فرصة إلزالة القيود التي تحد من
،ومن املتوقع أن يتجاوز الدين العام ٦ ٧يف املائة من إجاميل الناتج تنمية قطاع خاص أكرث حيوية .وعىل املدى القصري ،ال يزال من الرضوري
املحيل .ومن املتوقع أيضً ا أن يرتفع عجز الحساب الجاري إىل ٦يف املائة استخدام كل املساحة السياسية املتاحة لضخ السيولة واألسهم يف
من إجاميل الناتج املحيل .عىل الرغم من شدة األزمة ،فإن املغرب يف القطاع الخاص ملنع مشاكل السيولة من التحول إىل موجة من إفالس
xiiiالرشكات .عىل املدى الطويل ،ميكن للمغرب أن يحفز املنافسة ويخلق الصناعية املناسبة تساعد ترسيخ مكانة املغرب كوجهة قريبة للرشكات
مجال متكافئًا للوافدين الجدد يف أسواق السلع والخدمات ،مع تحسني
ً متعددة الجنسيات ،وبالتايل االستفادة من الفرص االسرتاتيجية التي ميكن
رأس املال البرشي واألطر املؤسسية .وباإلضافة إىل ذلك ،فإن السياسات أن تنشأ عامليا يف ما بعد الجائحة.
xiv MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERY1
RECENT ECONOMIC
DEVELOPMENTS
A
s in much of the world, the COVID-19 Morocco did not experience the exponential growth
pandemic has simultaneously triggered in infections and fatalities that affected much of the
a supply and a demand shock on the world. After a peak of 137 in April, the number of daily
Moroccan economy. This is causing a severe fatalities from COVID-19 fell to 35 in May and to only
recession, and Q2-2020 (which broadly coincides 20 in June.
with the lockdown) witnessed the largest economic This successful containment of the first
contraction on record. After the most stringent social wave of contagions was made possible by the
distancing restrictions were lifted in June, economic stringent measures adopted early on by the
activity began exhibiting some encouraging signs. Moroccan authorities. By March 15, all international
However, the epidemiological situation is worse flights and ferry crossings had been suspended,
now than it was during the first wave of contagions, schools had been shut down, and a strict confinement
which cast doubts on the pace of the recovery. The took effect on March 20. The stringency of the social
COVID-19 shocks are resulting in an expansion of distancing response adopted by the authorities is
Morocco’s budget deficit and the debt to GDP ratio illustrated in Figure 2, which shows how quickly
is on the rise. Morocco became one of the countries of the world
with the stricter measures in place. In fact, between
March 25 and June 10, Morocco was on average the
Epidemiological Developments: eighth country of the world with the highest stringency
A Tale of Two Waves index (compiled by Oxford University, measured from
0 to 100): 94, against 73 in the MENA region, 84 in
The first wave of contagions from the COVID-19 Tunisia, 82 in France, 81 in Algeria, 79 in Spain and
pandemic was relatively mild in Morocco. The 76 in Italy.
first case of COVID-19 was confirmed on March 02, However, following the relaxation of the
2020, after which the number of contagions began to lockdown in July, COVID-19 cases began to pick
increase steadily: by the end of March 617 cases had up, and the second wave of contagions is taking
been confirmed, against 3,806 new cases in April, a heavier toll than the first one, as is the case in
3,384 in May and 4,726 in June (Figure 1). However, many countries. On June 11, the authorities eased
1FIGURE 1 • Epidemiological Situation
Daily contagions and deaths in Morocco Cumulative cases, Morocco vs. the world
300,000 60,000,000
7,000 90
6,000 80 250,000 50,000,000
70
5,000 60 200,000 40,000,000
4,000 50 150,000 30,000,000
3,000 40
30 100,000 20,000,000
2,000
20 50,000 10,000,000
1,000 10
0 0 0 0
11–Mar
25–Mar
8–Apr
22–Apr
6–May
20–May
3–Jun
17–Jun
1–Jul
15–Jul
29–Jul
12–Aug
26–Aug
9–Sep
23–Sep
7–Oct
21–Oct
4–Nov
11–May
11–Aug
11–Mar
11–Sep
11–Jun
11–Apr
11–Oct
11–Jul
Daily contagions (LHS) Daily deaths (RHS) Morocco (LHS) World (RHS)
Source: Ministry of health Morocco-Our world in Data .
the lockdown in the regions and cities that had been of writing Morocco finds itself in an intermediate
less severely hit by the pandemic, and by June 24, situation, with on average 130 reported new cases per
the confinement came to an end in the entire country. million inhabitants in the first 20 days of November,
During the first four weeks of the post-confinement against a world average of 73, but well below most
period, the pandemic remained under control, with advanced economies and in a 60th position globally.1
an average of 252 daily new cases between June The authorities have so far responded
24 and July 22. However, in late July contagions with more targeted social distancing measures
began to pick up, and have remained on an upward to the second wave of contagions. In late July, the
trend until recently: on average 570 new daily cases government re-imposed restrictions to internal mobility
between July 22 and July 31; 1,230 in August; 1,993
in September; 3,029 in October. The number of
deaths followed suit, with an average of 25 COVID-19 1
However, it is important to note that such international
related fatalities in August, 35 in September and 47 comparisons have serious limitations because of sharp
in October. If compared internationally, at the time differences in countries’ testing capacities.
FIGURE 2 • Government Response Stringency Index
100
90
80
70
60
50
40
30
20
10
0
01 jan 2020
08 jan 2020
15 jan 2020
22 jan 2020
29 jan 2020
05 feb 2020
12 feb 2020
19 feb 2020
26 feb 2020
04 mar 2020
11 mar 2020
18 mar 2020
25 mar 2020
01 apr 2020
08 apr 2020
15 apr 2020
22 apr 2020
29 apr 2020
06 may 2020
13 may 2020
20 may 2020
27 may 2020
03 jun 2020
10 jun 2020
17 jun 2020
24 jun 2020
01 jul 2020
08 jul 2020
15 jul 2020
22 jul 2020
29 jul 2020
05 aug 2020
12 aug 2020
19 aug 2020
26 aug 2020
02 sep 2020
09 sep 2020
16 sep 2020
23 sep 2020
30 sep 2020
07 oct 2020
14 oct 2020
MENA Average Morocco Algeria Spain France Italy Tunisia
Source: own calculations based on the Coronavirus Government Response Tracker Database (Oxford University).
2 MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYFIGURE 3 • Morocco Mobility Data (% change from pre-COVID-19 baseline)
40
20
0
–20
–40
–60
–80
–100
Feb–20 Mar–20 Apr–20 May–20 Jun–20 Jul–20 Aug–20 Sep–20 Oct–20
Retail and recreation Grocery and pharmacy Parks Transit stations Workplaces
Source: Google mobility data.
in response to the spike in contagions. In addition, the lockdown was gradually eased in June, these mobility
most affected cities, including Casablanca, Marrakesh, indicators began to pick up, but have only reached the
and some areas of Rabat and Tangier, have been placed pre- COVID baseline in the case of the visits to grocery
under partial lockdown and imposed nighttime curfews, and pharmacy. In this context, it is not surprising that
among other restrictions. However, as suggested by the after a lackluster first quarter, GDP growth collapsed
evolution of the stringency index displayed in Figure 2, during the second quarter, registering a 14.9 percent
these measures are nowhere near the strict response y-o-y contraction, the worst data point ever to be found
to the first wave of contagions, reflecting the fact that in that series.
the government is now much more aware about their An unusually dry weather has contributed
potential economic, social and psychological impacts. to aggravate the crisis. An estimated 16 percent
Instead, the authorities intend to move forward with the decline in rainfall in the 2019–20 season has
vaccinations program as fast as possible, although H.M. resulted in a sharp drop in certain crop yields, and
the King himself has warned about the possibility of a especially of rainfed wheat, the production of which
new confinement should the pressure on the Moroccan has halved. As a result of persistently adverse climatic
health system continue to mount. conditions, agricultural value added has registered
six consecutive quarters of negative y-o-y growth,
which reached –6.8 percent between April and June
A Recession of Historical Proportions 2020. With even more intensity than the pandemic
Puts an End to more than Two itself, the draught is having a severe social impact in
Decades of Sustained Economic rural areas given that, although the agricultural sector
Expansion only represents 12 percent of GDP, it still employs 38
percent of Morocco’s labor force.
The Moroccan economy has entered its first Although few sectors have been spared, the
recession since 1995. The lockdown imposed by impact of the shock on the various components
the authorities to confront the pandemic brought of supply and demand has been uneven. On
economic activity to a sudden stop. A commonly the production side, manufacturing industries
used proxy to illustrate that trend is Google’s mobility underwent a 22 percent y-o-y decline during the
data, which exhibited an 80 percent decline in retail second quarter, and the automobile, aeronautics
and recreation visits or a 60 percent fall in visits to and electronics sectors suffered the most as a result
workplaces during the confinement (Figure 3). As the of the disruptions in Global Value Chains (GVCs)
Recent Economic Developments 3FIGURE 4 • GDP: Decreasing Demand (y-o-y %) FIGURE 5 • GDP: Uneven Impact of the Crisis on
the Supply Side (y-o-y %)
15
10 50
5
0 0
–5
%
–10
%
–15 –50
–20
–25 –100
–30 2020Q1 2020Q2
–35 Agricultural Fishing
2019 2019 2019 2019 2020 2020 2020
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Mining Manufacturing industries
Electricity and water Construction
Private Consumption Government Consumption Trade Hotels and restaurants
Gross Capital formation Exports Transportation Post and telecommunications
Imports Financial activities and insurance
Source: HCP. Source: HCP.
caused by the pandemic. The services sector, which The sudden stop in economic activity is
has been the main engine of economic growth over having a severe impact on jobs and household
the past 20 years, dropped by 14.9 percent in Q2- incomes. It is estimated that close to 581,000
2020.Therefore non-agricultural growth declined by jobs have been lost between September 2019 and
–15.5 percent. During this economic crisis, just a few September 2020, 258,000 in the primary sector,
sectors have continued to grow in Q2-2020: fisheries, 61,000 in the secondary sector and 260,000 in the
extractive industries, and the chemical, health and tertiary sector (Source: HCP). During the second
financial sectors. By contrast, the hardest hit sectors quarter, which broadly coincides with the lockdown,
have been hotels and restaurants (–90 percent) and the average number of worked hours more than halved
transportation (–55.7 percent). On the demand side, (from 45 to 22 per person per week). Furthermore,
private consumption dropped by 21.2 percent and the surveys conducted by HCP indicate that about
investment by 17.4 percent, a decline that was only two thirds of workers had to stop their activity during
partially compensated by an increase in government confinement while 62 percent have experienced
consumption. Net exports also weighed negatively an income loss during that period. In this context,
on growth, with the drop in exports (–28.7 percent) poverty and vulnerability rates are expected to spike
exceeding that of imports (–25.7 percent). this year, putting an abrupt end to the uninterrupted
FIGURE 6 • Increasing Unemployment FIGURE 7 • Loss of Income
14 46.5 72 70
12 46.0 70 68.2
45.5 68 66.2
10 45.0 66
8 64 63.1
44.5 62
62
%
%
%
6 44.0 60 59
4 43.5 58
43.0 56
10.2
10.5
12.3
12.7
11.6
2 42.5 54
9.1
9.7
8.1
9.4
9.1
9.3
8.8
13
9
0 42.0 52
2019 2019 2019 2019 2020 2020 2020 Percentage of workers on Income loss
Q1 Q2 Q3 Q4 Q1 Q2 Q3 temporary work stoppage
during confinement
Unemployment rate Underemployment rate
Participation rate Urban Rural National
Source: HCP. Source: HCP.
4 MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYBOX 1. MOROCCO’S STATISTICAL CAPACITY
Among its other unexpected consequences, the global spread of the COVID-19 has generated increased public attention to the
relevance, timeliness and accuracy of statistics. Indeed, data analyses quantifying the socio-economic impact of COVID are of high
demand all over the world, including information on the proportion and characteristics of laid-off workers and firms which exited the
market.
Morocco’s Statistical Capacity Indicator (a composite score ranging from 0 to 100) is above the average of the MENA region, and
slightly below that registered on average in Latin America and the Caribbean (LAC) (Figure 8). However, and in line with the MENA as
well as the LAC regions, Morocco’s SCI has tended to decline between 2005 and 2019. Moreover, the index has declined in each of the
three statistical sub indicators that are used to compute the SCI: methodological consistency with international standards, timeliness
and accessibility (Figure 9). Stepping up the country’s efforts to cover existing gaps in the capacity of Morocco’s National Statistical
System is particularly critical in the context of Covid-19, given the importance of good quality, up to date, and accessible data to mount
an effective response to the pandemic.
FIGURE 8 • The Statistical Capacity Indicator (SCI) FIGURE 9 • SCI Sub-Components, Morocco
100 100
80 80
60 60
40
40
20
20
0
0 Methodological Timeliness Accessibility
Morocco MENA LAC EAP SA ECA consistency
2005 2019 2005 2019
Source: World Development Indicators. Source: World Development Indicators.
improvement in social indicators achieved by Morocco HCP’s most recent nowcasts, the y-o-y decline in
since the turn of the century (HCP, UN and WB, GDP did continue during the third quarter mainly
2020).2 Nonetheless, assessing the socio-economic driven by the drop in non-agricultural value added (–9
impact of the COVID crisis in Morocco is a complex percent). Kickstarting investment is proving especially
task given the country’s still relatively weak statistical challenging, as gross capital formation still contracted
capacity (Box 1). by 17.4 percent y-o-y during the third quarter. Also
Although economic activity picked up in the contributing to explain the weak recovery, HCP still
aftermath of the Spring-Summer confinement, expects a 10.8 percent contraction in households’
the recovery is still fragile, despite sustained consumption in the third quarter.
efforts to mitigate economic disruptions. The data In this context of depressed economic
displayed in Figure 3 evidences that, although still activity, price pressures remain subdued. Headline
below its pre- COVID baseline, mobility has increased inflation on year-on-year basis averaged 0.7 percent
substantially after the most stringent social distancing
restrictions were lifted. Among the green shoots that
can already be discerned are the evolution of certain 2
Note stratégique: Impact social et économique de la
exports, such as automobiles and agro-industrial crise du COVID-19 au Maroc (2020) https://www.hcp.
products, which have already posted positive y-o-y ma/Note-strategique-Impact-social-et-economique-de-la-
growth rates on Q3-2020. However, according to crise-du- COVID-19-au-Maroc_a2582.html.
Recent Economic Developments 5FIGURE 10 • Slow Recovery for Q3 and Q4 2020 FIGURE 11 • Absence of Price Pressures
(y-o-y %)
2.5
10
2.0
5 2.8 2.4 2.4 2.3
0.1
0 1.5
–5
%
–5.5 1.0
%
–10 –8.7
–15 0
–14.9
–20
2019 Q1
2019 Q2
2019 Q3
2019 Q4
2020 Q1
2020 Q2
2020
Q35 (project.)
2020
Q4 (project.)
–1.0
–1.5
Jan–20
Feb–20
Mar–20
Apr–20
May–20
Jun–20
Jul–20
Aug–20
Sep–20
Non-agricultural Value added
Agricultural Value added
RGDP Headline inflation Core inflation
Source: HCP. Source: HCP.
during the first nine months of 2020, although it This process included the liberalization of gasoline
increased to 1.4 percent in September-20, probably and diesel prices, the containment of the wage bill,
reflecting the partial recovery of economic activity in a pension reform, as well as measures to improve
the aftermath of the confinement. Food prices have tax collection through broadening the tax base,
been the major driver of headline inflation, as core harmonizing tax rates, and fighting tax evasion. With
inflation remains close to 0 (0.2 percent y-o-y). At its the onset of the pandemic, the fiscal consolidation
most recent meeting, in September, the central bank efforts have, understandably, been discontinued
left its policy rate unchanged at 1.5 percent, after two to allow for additional expenditures, mainly driven
consecutive rate cuts in March and June, when the by the budgetary support of the COVID-19 fund
policy rate was cut by a cumulative 75 basis points (Government contributed 1 percent of GDP), and to
(see section 2 for more details on the monetary accommodate the impact of the collapse in economic
response to the crisis). activity on tax revenues collection (which contracted
by 8.4 percent during Jan–Aug 2020 compared
with Jan–Aug 2019)—Figure 12. As a result, during
The COVID-19 Shock is Adding the first eight months of 2020, the overall budget
Pressure on Morocco’s Budget deficit increased by 32 percent to 46.5 billion MAD
Deficit, but the Current Account is (4.3 percent of GDP) and the Treasury’s debt has
Behaving Better than Anticipated increased by 53.7 billion MAD between December
2019 and July 2020, from to 65.4 percent to 73.7
The COVID-19 pandemic has put an end to
percent of GDP, respectively (Figure 13).3 The total
Morocco’s fiscal consolidation efforts. The
debt of SOEs stood at 25.4 percent of GDP at the end
countercyclical fiscal policies deployed in 2008 by
of 2019. Almost 60 percent of that amount is external
the authorities to mitigate the impact of the global
debt (16.6 percent of GDP in mid-2020) guaranteed
financial crisis and subsequently the EU debt crisis led
by the state, most of which is denominated in foreign
to a sharp deterioration in Morocco’s fiscal balance.
In 2013, as the impact of the above crisis waned, 3
Note that these debt statistics include only the Treasury’s
Morocco initiated a process of fiscal consolidation obligations, and not the public sector’s overall debt (e.g,
that allowed it to reduce its fiscal deficit from 7.2 they exclude state owned enterprises, public financial
percent of GDP in 2012 to 3.7 percent in 2018. institutions and subnational governments’ debt).
6 MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERYFIGURE 12 • Decreasing Revenues (y-o-y %) FIGURE 13 • Rising Central Government Debt
100 80 73.8
80 70 64.9 65.1 65.2 65.0
61.7 63.4 63.7
60 60
40
50
% of GDP
20 57.8
%
40 47.1 47.9 49.2 50.4 50.6 51.7 50.8
0
–20 30
–40 20
–60 10 15.5 16.0
14.6 14.5 14.5 14.5 13.5 14.2
Jan–20
Feb–20
Mar–20
Apr–20
May–20
Jun–20
Jul–20
Aug–20
Sep–20
0
2013 2014 2015 2016 2017 2018 2019 2020
(end july)
Tax revenues Non-tax revenues
Current spending Investment spending Central government debt Domestic (net) External (net)
currency, exposing borrowers that lack a natural FIGURE 14 • Current Transactions (y-o-y %
hedge to currency risk. Morocco’s consolidated debt changes)
at the end of 2019 stood at 56.4 percent of GDP (56 30 60
percent of GDP in 2018 and 54.1 percent of GDP in 20 40
2017), almost 10 percentage points lower than the 10 20
central government debt-to-GDP ratio.4 0 0
–10 –20
The crisis is having a stronger effect
%
–20 –40
on imports than on exports, and the current –30 –60
account deficit fell during the first semester. –40 –80
Plummeting external demand adversely impacted –50 –100
export performance, which declined by 11.8 percent –60 –120
Jan–20
Feb–20
Mar–20
Apr–20
May–20
Jun–20
Jul–20
Aug–20
Sep–20
between January and September 2020 and the
same period in 2019. The contraction of exports was
Exports Imports
particularly severe in the automotive (–16.1 percent), Tourism receipts Workers remittances
aeronautics (–24.7 percent) and textile (–22.13
Source: Morocco office des changes.
percent) sectors. However, the fall in imports was
even larger (–16.2 percent), implying that Morocco’s
merchandise trade balance has improved (Figure 14).
bond issuance in September (Figure 15). On the other
Another component of the current account that has
hand, net FDI flows have contracted by close to 28
deteriorated is tourism receipts (–55.3 percent), while
percent between January and August 2020 and the
workers’ remittances have been resilient, especially in
same period a year before.
recent months. The current account deficit reached
The Dirham has appreciated vis-à-vis the
3.5 percent of GDP during the first semester of 2020,
US dollar. Morocco’s exchange rate peg to the Euro
against 5.1 percent of GDP during the same period
of 2019. After an initial decline in the weeks that
followed the onset of the pandemic, international 4
The consolidation of public debt involves the netting out
reserves have edged upwards, primarily as a result of
of inter-governmental obligations. The government has
the decision to draw the entire amount of Morocco’s began only recently to publish that information, as part
Precautionary Liquidity Line with the IMF (close to of a broader effort to increase the transparency of debt
US$3 bn) in March and a successful €1bn sovereign statistics.
Recent Economic Developments 7FIGURE 15 • Stable Gross Official Reserves FIGURE 16 • No Pressure on the Exchange Market
MAD/$ market
35 7.5 7.3 7.5 8 10.5 15
7.0
6.4 6.7 6.7
30 7 10.0
5.4 5.4
6
25 9.5 10
Months of imports
5
20
Billion $
9.0
4
15 8.5 5
3
10 8.0
2
5 1 7.5 0
Mid–Feb
Mid–Mar
Mid–Apr
Mid–May
Mid–June
Mid–Jul
28–Jul
Mid–Aug
1–Sep
22–Sep
25–Sep
8–Oct
13–Oct
27–Oct
10–Nov
0 0
Jan–20
Feb–20
Mar–20
Apr–20
May–20
Jun–20
Jul–20
Aug–20
Sep–20
Banks' net FX (MAD bn, rh) Mid–day fixing (MAD/$)
Gross officila reserves Months of imports Min band (MAD/$) MAX band (MAD/$)
Source: Morocco office des changes. Source: Bank-Al-Maghrib.
and the US dollar has been partially relaxed with the vis-à-vis the Euro while appreciating against the
widening of the band. This move has been aimed at dollar (7.1 percent between April and October). The
increasing the external shock absorbing capacity of appreciation of the real effective exchange rate has
the Moroccan economy and was put to the test during been primarily the result of a basket effect that reflects
the COVID-19 crisis. In fact, as expected, during the the weakening of the US dollar, itself the product of
weeks that followed the onset of the pandemic, the broader forces in the world economy (Figure 16).
dirham depreciated against both the Euro and the However, this trend can also be interpreted as a sign
US dollar. From April onwards, however, this trend of confidence on the resilience of the Moroccan
was reversed, and the Moroccan dirham stabilized economy.
8 MOROCCO ECONOMIC MONITOR – FROM RELIEF TO RECOVERY2
OUTLOOK AND
CHALLENGES
T
he government of Morocco has taken a primarily through direct subsidies and the deferment
pro-active approach to mitigate the effects of certain payments, together with a series of monetary
of the pandemic on the economy through and financial measures aimed at preventing the
a combination of tax and other payments deferrals, emerging liquidity pressures from turning into a wave
wage subsidies, credit guarantees, public investment of corporate insolvencies. Subsequently, as most
and structural reform. However, activity will probably businesses were allowed to resume their activities in
remain subdued until health risks abate. We project June, the authorities transitioned towards a longer-
real GDP to contract by 6.3 percent in 2020 and term more strategic approach aimed at supporting
to return to its pre-pandemic level only in 2022. In the recovery and at adapting Morocco’s development
the meanwhile, Morocco’s twin deficits will expand model to the new normal that is expected to emerge
in the short-term, generating additional external in the post-pandemic world.
financing needs in a global context that remains The government’s response was initially
highly uncertain. Unchaining the growth potential of focused on partially compensating households
the Moroccan economy, which disappointed even and firms for the loss of income associated
before the onset of the pandemic, continues to be a with the lockdown, for which a special fund was
central challenge. created. The extrabudgetary special COVID-19 fund
was endowed with contributions from the central
government and other public entities (primarily
Morocco’s Economic Policy Response SOEs), banks and private companies, wealthy
to the Pandemic: From Relief to individuals and foreign donations, for a total amount
Recovery of 33.7 billion DH (US$3.6 billion, close to 3.1 percent
of GDP). These resources were used to fund the
Morocco’s response can be broadly categorized public health response to the pandemic, but also to
into two stages: emergency management and finance the distribution of approximately 22.4 billion
recovery support. As was the case in most countries, MAD (2.1 percent of GDP) in direct transfers to formal
the authorities focused initially on the mitigation of the and informal workers affected by the interruption of
immediate effects of the lockdown, which was done economic activities (Box 2). Another element of the
9BOX 2. REVIEW OF THE MAIN MITIGATION MEASURES ADOPTED DURING MOROCCO’S LOCKDOWN
Crisis management governance. A Committee (the so-called Comité de Veille Économique) was created to monitor and mitigate the impact of
the pandemic on the Moroccan economy. This committee brings together senior officials from the government and the central bank with
representatives from the financial and the corporate sectors. It has met on 10 occasions between March and October.
Fiscal stimulus. On April 6, a decree was passed to authorize the government to surpass the external borrowing ceiling originally contemplated
in the 2020 Budget Law. One day later, the authorities purchased all available resources under the IMF’s Precautionary and Liquidity Line
(about US$3 billion). Apart from the direct 10 billion MAD (0.9 percent of GDP) contribution of the central government to the COVID-19 fund,
the public response to the pandemic has resulted in an increase in certain expenditures, which will contribute to a substantial expansion of
the budget deficit. In July, the government passed a revised Budget Law for 2020 that incorporated the effects of the measures adopted
to confront the pandemic and updated macroeconomic projections.
Payment deferrals. Formal companies with an annual turnover below 20 million MAD were allowed to defer the declaration and payment of
corporate income tax corresponding to fiscal year 2019; companies with an annual turnover above 20 million MAD were allowed to request
for a deferral of corporate income tax payments; firms with less than 500 employees were allowed to postpone social contributions until the
end of June (or through September for hard-hit sectors, such as tourism). In addition, firms and individuals could postpone the amortization
of certain types of loans.
Emergency cash transfer for formal and informal workers (March–July). A monthly 2,000 MAD transfer (net of family and health benefits) was
approved for workers affiliated to the social security scheme (CNSS) affected by the lockdown (for firms that completely interrupted their
activity, or whose turnover decreased by at least 25 percent). It is estimated that close to 900,000 workers have been eligible for this
benefit in April and May, and almost 600,000 in June. For informal workers, an 800 MAD monthly transfer was put in place for households
of two people or less; 1,000 MAD for households of three to four people; 1,200 MAD for households of more than four people. This
component was targeted at the beneficiaries of the non-contributory health insurance scheme—the Medical Assistance Regime (RAMED)—
and an online application process was set up for households not benefiting from RAMED. It is estimated that this component of the
emergency cash transfer program benefited approximately 5.5 million households, at a cost of close to 15 billion MAD.
Monetary and liquidity measures. The central bank reduced its policy rate by 75 bp and the foreign exchange band was widened to +/-5 percent.
To increase its ability to inject liquidity into the financial system, the BAM also expanded the types of collateral that it accepts in its Repos,
it lengthened the maturity of its refinancing operations, and began providing foreign exchange swaps to Moroccan banks. To stimulate
credit, the BAM allowed banks to reduce their liquidity cover ratios below 100 percent and to suspend their provisioning requirements,
while reserve requirements were lowered from 2 percent to 0 percent and the capital conservation buffer was reduced by 0.5 percent.
Guarantees. The Damane Oxygene program was launched on March 26 to support firms’ working capital. It provided a 95 percent guarantee
for credits to firms with a yearly turnover of less than 200 million MAD but was also made available for larger companies (turnover between
200 and 500 million MAD). It covered credits for up to 3 months of beneficiary firms’ operating expenditures, with a ceiling of 20 million
MAD. A few weeks later, the government launched another guarantee program for self-entrepreneurs covering 85 percent of credits up to
15,000 MAD.
authorities’ approach to mitigate the impact of the At a second stage, a longer-term approach
shock was to carry over social security contributions was taken to support the economic recovery
and defer taxes for both firms and individuals expected to take place in the aftermath of the
during the lockdown period, as well as a temporary lockdown. The key elements of this strategy were
postponement of debt servicing obligations. outlined in the National Pact for Economic Recovery
In addition, various measures were taken and Employment (Pacte National pour la Relance
to inject liquidity into the economy, support Économique et l’Emploi)—henceforth the Pact—
firms’ cash position and keep credit flowing, thus signed in early August between the government, the
preventing corporate bankruptcies. This mitigation General Confederation of Moroccan Enterprises and
strategy was built on four pillars: an expansionary the Banking Association. It set four major medium-
monetary policy; liquidity injections into the banking term objectives to be jointly pursued by the public
system; relaxation of microprudential norms to and the private sector: accelerating the recovery,
stimulate credit; loan guarantees. safeguarding jobs, fostering the formalization of
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