Kiosk360. By the end of 2022, corporate insolvencies are expected to grow by 10% globally. This proportion would be higher in Morocco. It is estimated at 12% by Allianz Trade. This article is a press review from the newspaper Les Inspirations ECO.
Business failures should grow more in Morocco than in the rest of the world. In today’s edition, ECO Inspirations announces a rate of 12% for the Kingdom against 10% worldwide. “A double-digit growth which remains alarming for the country which has begun its economic recovery with the aim of creating value and employment”, he analyzes, even ensuring that “Morocco remains one of the main contributors to the increase in business failures on the African continent”. Indeed, the growth of insolvencies in South Africa would only be 4% for the year 2022.
The daily also maintains that the increases in business failures in 2022 and 2023 could be significant for Morocco’s strategic partners (Spain, France, Germany, Italy, India, Brazil, etc.) which would thus mechanically impact the economic recovery in the country. Added to this, the war in Ukraine and the containment measures in China are adding to the pressures that are already weighing on the cash flow of companies around the world.
That being said, the newspaper is optimistic for 2023 since it is estimated that defaults in Morocco will fall by 4% against a rise of 5% for South Africa. ECO Inspirations announces the levers to be activated to reduce the pockets of fragility that push Moroccan companies to go out of business. Starting with substantial efforts to be made in fields as varied as “R&D, the integration of value chains, the search for new outlets, the fight against overcapacity in certain sectors, the weight of taxation, the problems of business-to-business payment or the fight against informal trade”.
He believes “that certain occasional recourse to emergency financing could certainly relieve the cash flow of companies at a given moment, but that their reimbursement could induce very serious problems afterwards”. This will not prevent that “loans to companies should continue to be granted according to the logic which prevailed before the Covid era, so as not to hamper the chances of companies in the years to come, because companies must increasingly learn to adapt to the new normal”.
The daily concludes its remarks with the factors of resilience. He mentions three: the total amount of cash held by listed companies was 30% higher than the level observed in 2019, the limited number of fragile companies in Europe, particularly in Italy (from 11% in 2020 to 7% in 2021) and in France (from 15% to 12%) as well as confirmation that companies listed in Q1 2022 have been able to pass on the increase in costs to sales prices.