Moroccan Textile Industry Faces Job Cuts Amid COVID-19 Slowdown

The consequences of the health crisis continue to impact the global economy. Moroccan textile workers were able to hold out, avoiding mass layoffs during the lockdown, thanks to the Covid CNSS allowance. In addition, the catch-up in export demand has allowed companies, since July, to retain jobs, reports Les Eco.

However, for some time now, the sector has been experiencing such a decline that it is feared that it will lead to massive layoffs. The sector is experiencing a slowdown in demand, both for exports and on the local market, and there is also a lack of visibility on demand for the last quarter of the year. "The first feedback from the field, reporting on the temporary closure of companies due to lack of orders, makes us fear that the worst is yet to come, in terms of layoffs," explained the Managing Director of the Moroccan Association of Textile and Clothing Industries (AMITH), Fatima-Zohra Alaoui.

In addition to these reasons that are already destabilizing the sector since the start of the pandemic, international customers are imposing discounts of up to 10% on certain orders in production. "The other problem is the high number of unpaid bills with some of our industrialists, undermining an already depleted cash flow," added AMITH.

At the end of July, sales figures have dropped considerably, unlike the beginning of the year. In the first two months of the year, the sector recorded growth of 3.4%. From March to May, textile exports fell by 41%. But the latest figures for the months of June and July suggest the possibility of a catch-up, with an annual underperformance reduced to 29.7%, noted the Managing Director of AMITH.