Morocco’s Economic Growth Slows to 0.7% in Q1 2020 Amid Poor Crop Yields

This downward revision would be attributed to the poor performance of crop production, in particular cereals, whose production would have fallen to its lowest level since 2007. Despite the decline in foreign demand addressed to Morocco, "exports of goods and services in volume would have increased by 0.3% in the first quarter." Imports would have, for their part, slowed down, showing an increase of only 1%, instead of +3% a year earlier.

Since the publication of the previous HCP press release, the growth prospects for the world economy have been revised downward, due to the spread of the COVID-19 pandemic and the extension of confinement periods in several countries. This is why the HCP forecast, in terms of growth in foreign demand addressed to Morocco, has been revised downward to reach -12.5% in the second quarter of 2020, instead of -6% forecast on April 7, reports ecoactu.ma.

According to the HCP, household consumption growth is also expected to decline by 1.2% in the second quarter of 2020, "due to the decline in spending on energy, durable goods, transport, catering and leisure." It also points out that the worsening of the health crisis would push companies to "limit their financing needs as much as possible, in a context of uncertainty about the recovery in demand."

In total, "national economic growth would be reduced by 8.9 points in the second quarter of 2020, compared to the trend observed before the COVID-19 crisis, instead of -3.8 points forecast on April 7." This would represent a potential overall loss of around 29.7 billion DH for the first half of 2020, instead of 15 billion DH forecast on April 7.

The HCP stresses that these forecasts could undergo more or less significant revisions in view of the publication of new data, the evolution of the global situation and the impact of support plans on the national economy.