Agadir – COVID-19 has had a devastating impact on the majority of Moroccan companies, according to a recent survey by Morocco’s High Commission for Planning (HCP).
The survey, the third of a series of similar studies carried out in 2020 to measure the impact of the health crisis on Moroccan businesses, indicates that more than 16% of Moroccan companies temporarily or permanently closed their doors by the end of 2020.
The first survey, carried out in April 2020, measured the immediate repercussions of the pandemic on the financial situation of companies. The second survey was carried out in July 2020 and aimed to assess the level of resumption of activity that followed the easing of COVID-19 related safety measures.
With the third iteration of the survey, HCP sought to assess business activity between July and December 2020, and to compare it to the same time period from before the pandemic. According to HCP, this will allow companies to understand their current levels of performance in comparison to normal, pre-COVID-19 times.
The survey reveals that 83.7% of Moroccan companies remained active in the second half of 2020. It added, however, that 8.1% of the companies have since temporarily shut down, while 6% have had to temporarily close after the resumption of activity and 2.2% have declared shutting down permanently.
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The most affected sectors were transport, catering, and real estate. The three sectors are still struggling to reach normal levels of activity, with companies that are temporarily shut down reaching 31%, 27% and 25% respectively.
HCP also looked at the effect that the pandemic had on private employment, with the survey showing that nearly 38% of companies have had to reduce the number of employees by the end of last year.
Looking at the most affected sectors in terms of employment lost, catering, accommodation and construction companies have experienced the highest shrinkage of workforce, with 64% and 56% respectively.
The study also noted that 2020 saw Moroccan companies struggle with their cash flow. 40% of Moroccan companies said they do not have a cash reserve, while 8% have a reserve sufficient for less than a month.
The survey was carried out with a sample of 3,600 companies, representing the sectors of manufacturing industry, construction, energy, mining, fishing, trade, and non-financial market services.