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Rabat – Allianz Trade, the trade credit branch of insurance giant Allianz, predicts that 13,000 businesses will become insolvent in Morocco in 2024, based on current trends.
The Allianz Trade Insolvency Report highlights that global insolvency levels are expected to surpass those from before the pandemic, as they are set to bounce by 21% in 2023 and 4% in 2024.
In Morocco, the business insolvency rate went up by 17% in 2022, and is expected to increase by 53% in 2024, compared to pre-pandemic figures from 2019.
In 2020, 6,620 businesses went insolvent in the country, a number that exceeded 10,000 in 2021, and reached new highs of more than 12,000 in 2022.
Allianz Trade expects the number to reach 13,000 in each of 2023 and 2024.
Such an increase would be only a 5% rise between 2022 and 2023, which is better than the rates experienced in the years prior.
Allianz Trade’s research shows that Africa is the continent that has seen the highest global and regional insolvency indices, likely owing to the disproportionate impact of global crises such as the COVID-19 pandemic and the Russia-Ukraine war.
The number and rate of insolvencies could go up even higher in the event of a new financial crisis, or even in the event of a credit crunch or credit freeze, said Maxime Lemerle, Lead Analyst for Insolvency Research.
A study from Moroccan firm Inforisk revealed earlier this year that more than 12,000 businesses failed last year in the country, with 99% of them being very small enterprises (VSEs).
Moroccan businesses remain “poorly aware” of the available preventive measures they can opt for to protect themselves against bankruptcy, noted the study.
Experts agree that economic factors like high inflation, higher energy costs, and interest rates will continue to exert significant cash and profitability pressures on businesses.
