More than one in two Moroccan businesses face “invisible” competition

More than one in two Moroccan businesses must compete with rivals that do not always appear in official registers.

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The proportion stands at precisely 55.4%, according to the World Bank report on growth and employment in Morocco.

For declared businesses, the competition is uneven. They pay taxes and social contributions and must comply with administrative obligations that some informal activities can avoid.

These competitors are therefore able to charge lower prices, even when they are less productive or offer lower-quality services.

Thousands of very small activities

Morocco’s informal economy is mainly made up of tiny structures. A unit employs an average of 1.2 people, and 85.5% are operated by a single person.

The problem therefore stems less from their individual size than from their number and their presence in many sectors, from trade to services and crafts.

These activities also operate largely among themselves. Around 57% of their purchases are made from other informal actors, while only 2.4% of their sales are destined for formal businesses.

For the World Bank, this competition may discourage declared small companies from growing. The more a business develops, the more visible it becomes, the more costs it bears, and the more exposed it is to inspections.

Some therefore prefer to remain small, while those that fully comply with the rules continue to bear higher costs than their informal competitors.

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A situation that slows their development and limits the creation of declared jobs in Morocco.