Morocco’s Construction Sector Slumps as Cement Sales Plummet 12%

The suspension of ongoing construction sites, due to the high rainfall recorded during 2020, would be the cause of this poor performance of the sector. Thus, cement sales had experienced a 2.7% increase in 2020, compared to 5.3% in 2019.

For professionals in the sector, the situation would have been catastrophic if the infrastructure segment, including RMC and precast, which records the most sales, had been affected. For the moment, public procurement is holding up, with the upgrading of roads and highways, urban development, public projects, buildings..., they assure.

But the situation is not as rosy when it comes to the real estate sector where construction sites are slowly resuming and real estate developers, hard hit by the health crisis, are hesitant to embark on new projects. Many of them have subscribed to the Damane relance product to cope with the difficulties of their cash flow.

As if that were not enough, there is also the reform introduced in the authorization requests. These, in addition to the safety notice, must now contain an energy efficiency sheet. "It takes time to adapt to integrate these new features into the way of doing things," says a real estate specialist. In any case, this new measure has contributed to the drop in cement consumption, and consequently, in precast sales which consume 70% of cement production.

According to some professionals, the situation is likely to persist, given the mismatch between the prices offered, the demand and the purchasing power. The High Commission for Planning (HCP), for its part, forecasts a growth of 5.1% for the construction sector in 2021, after a 9.8% drop last year. It is counting on government support to revive demand and implement a new policy focused on digitalization.