Rabat – Nearly 40% of industrial business owners have reported expecting sales to drop in the course of the first three months of 2023, reflecting an overall business climate clouded with uncertainty.
According to a monthly survey from Morocco’s central bank, Bank Al-Maghrib (BAM) in January, around 30% of industrial business owners forecast a rise in sales, while only 7% expect sales to drop, and 23% reported having no visibility over sales.
Regarding production, after months of rising crude materials, industrial business owners seem to be more optimistic about the prospect of recovery.
42% of surveyed business owners said they expect production to increase in the course of the three months following January. 23% reported that they forecast a stagnation in production, 6% said production would drop, and 29% said they have no visibility over the situation.
The BAM survey indicates that Morocco’s Capacity Utilization Rate (CUR) stood at 72% in January 2023, down from 74% a month earlier. The rate reflects the country’s current production output compared to its potential output.
While Morocco’s economic growth will likely accelerate to 3.1% at the end of 2023, up from 1.2% in 2022, the country’s economy is still liable to a multitude of external shocks, according to the World Bank.
Morocco’s industrial sector is especially vulnerable to the economic crisis looming on the horizon for the European Union, which is currently Morocco’s largest trading partner. In 2019, 64% of the North African country’s exports went to the EU.
Growth in the EU is forecasted to drop to 0.8% this year, compared to 3.5% in 2022. The spillover from the decelerating economic growth in the Eurozone is expected to affect Morocco’s exports.
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