Morocco’s Economic Recovery Stalls as European Restrictions Tighten

"The tightening of health measures could slow the economic rebound in the first quarter of 2021 or even cause a recession in the most affected countries. The final economic impact will depend on the length of these health measures and the budgetary support of the States to the sectors durably affected by the Covid-19 crisis. In the euro zone, after a historic decline in GDP of -7.5% in 2020, we expect an economic recovery of around 4.6% in 2021 and 3.8% in 2022," explains Selin Ozyurt, senior economist, head of the Africa region at Euler-Hermes, to the newspaper Finances News Hebdo.

The decline in activity in Europe, Morocco’s main economic partner, will have a negative impact on the kingdom’s economy, which has been severely affected by the health crisis. "The tourism sector will continue to suffer the biggest operating losses due to the new restrictions and border controls. In addition, the automotive, aeronautics and textile sectors will continue to suffer from the weakness of European demand," comments Mr. Ozyurt. "In Morocco, we project a historic decline in GDP of -7.2% in 2020, followed by an economic rebound of 4.3% in 2021," he added.

According to him, it is not until 2022 that Morocco will be able to regain its pre-crisis level of economic activity. "The recovery in activity in the first half of 2021 will certainly be more moderate than initially expected as long as the health restrictions related to the second wave of the epidemic continue to weigh on the economy," stressed the expert, noting that the Covid-19 crisis has put the internal and external macroeconomic balances of the Moroccan economy to the test.