 Morocco COVID-19 Country Case StudyMohamed Marouani, Caroline Krafft, Ava LaPlante, Ilhaan Omar, Ruby Cheung and Sarah Wahby No SPRR20222, Working Papers from Economic Research Forum Abstract: Morocco adopted a very stringent lockdown regime relative to other parts of the developing world in response to COVID-19 outbreak, as we show below. The lockdown may have helped initially limit the spread of the virus but could not be maintained for very long due to its a high social and economic costs. Loosening the lockdown was followed by a major resurgence of the pandemic in the summer and fall of 2020, which was eventually brought under control following further lockdown measures. These measures and a relatively successful early vaccination campaign worked to limit the spread of the virus until the advent of the delta variant that resulted in an even larger resurgence in cases and deaths in mid-2021 than the previous fall’s peak. Morocco’s economy suffered a severe blow due to the lockdown and other disruptions caused by the pandemic. After having grown at an annual rate of 2.5 per cent in 2019, Morocco’s GDP shrank by 6.3 per cent in 2020 (Haut-Commissariat au Plan, 2021; Krafft, Assaad, & Marouani, 2021). The most severely affected sectors were “hotels and restaurants”, which contracted by almost 91 per cent in the second quarter of the year relative to the same quarter a year earlier, and “transport”, which shrank by 60 per cent in the same time period (Haut-Commissariat au Plan, 2021). Morocco’s contraction was larger than the average for the Middle East and North Africa (MENA) and world economy as a whole (World Bank, 2021). As well as its reliance on tourism, Morocco was particularly exposed to global value chains, including a manufacturing sector and exports to Europe that were affected by severe recessions there (World Bank, 2021). There was a slight recovery in GDP in the third and fourth quarters of 2020, but most sectors’ growth remained negative relative to the same quarters in the previous year (Haut-Commissariat au Plan, 2021; Krafft, Assaad, & Marouani, 2021). The government of Morocco adopted a series of economic support policies to alleviate the effects of the crisis on firms and individuals. Early in the pandemic it created a special response fund equal to about 3 per cent of GDP (World Bank, 2021) and undertook a number of measures to ease the burden on firms by postponing tax payments, social insurance contributions and loan instalments (World Bank, 2020a, 2020b, 2021). It also eased monetary policies and bank reserve requirements and established new credit facilities for firms and expanded existing ones to the tune of about 11 per cent of GDP (World Bank, 2020a). Individuals also received economic support in the form of soft loans to self-employed workers with year-long grace periods, suspension of loan and mortgage repayments, and delays in income tax payments (IMF, 2021). Social support programs included assistance to formally employed workers who incurred income losses due to the lockdown through the social security system (Abouzzohour, 2020). Assistance to informally employed workers was channelled to workers whose households were registered with RAMED, the subsidized health care program for poor and vulnerable families (IMF, 2021). For those not registered in this program, an online platform was created to facilitate their registration for the assistance program. However, much of these assistance programs were limited to the period between April and June 2020 (IMF, 2021). Pages: 66 Published by The Economic Research Forum (ERF) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:erg:wpaper:sprr20222 Access Statistics for this paper More papers in Working Papers from Economic Research Forum Contact information at EDIRC. |
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