Under the effect of the health crisis of the new coronavirus, the World Bank expects Morocco’s real GDP to fall by 4% in 2020, before returning to growth in 2021 to reach 3.4%.
The World Bank (WB) has updated its global economic outlook, in a new report released Monday. Thus, the world institution forecasts a recession in Morocco’s real gross domestic product by 4% due to the pandemic of the new coronavirus (Covid-19). The kingdom’s GDP will return to growth in 2021, with 3.4%, it is estimated.
In its report, the bank recognizes a difference in percentage points of -7.5% and -0.2% for Morocco’s real GDP in 2020 and 2021 compared to the projections of January 2020. But the case of Morocco n ‘is obviously not isolated in the region.
In fact, economic activity in the Middle East and North Africa region is expected to fall on average by more than 4% under the effect of the Covid-19 and the evolution of the oil market. Indeed, the institution explains that “consumption, exports and services such as tourism [were] severely disrupted by the COVID-19 pandemic”, while for oil exporters, it also recalls “revenues and export taxes fell sharply with the collapse in oil prices.”
Global GDP also in recession
However, “regional growth should resume in 2021 as the impact of the pandemic diminishes and investments improve,” it continues, stressing that “economic conditions in the Middle East and North (MENA) have deteriorated considerably as a result of this “pandemic.
In this region, the largest recessions expected are those of Lebanon facing a serious financial crisis, its real GDP expected to fall by 10.9%, Iraq (-9.7%), Palestine (-7.6%) and Algeria (-6.4%). Tunisian GDP will also decline by -4%, while the only increase will be recorded by Djibouti.
In an analysis on the “social and economic impact of the Covid-19 crisis on Morocco”, the UNDP, UNECA and the World Bank said, last April, expecting a negative effect on the economy of Morocco, a deterioration in the overall budget deficit and an increase in poverty. “The impact of the crisis will probably be felt first” in the informal sector before spreading to other sectors. For the three institutions, “the economy of Morocco should suffer considerably this year”, while the “baseline scenario shows that real GDP would fall by 1.5% in 2020, the first recession hitting Morocco since more than two decades.”
The World Bank estimates that global GDP is expected to decline 5.2% in 2020, the worst global recession in more than a century.