Follow us on Facebook

Walaw

Economy

COVID-19 and Inflation Compound Morocco’s Economic Inequalities, HCP Report Reveals

Monday 24 June 2024 - 09:10

Zoom

Disparities Deepen as Morocco’s Poor Bear the Brunt of Economic Crises

Morocco’s recent economic challenges have disproportionately affected its least affluent citizens, according to a comprehensive report by the High Commission for Planning (HCP). The report highlights how the COVID-19 pandemic and inflation have significantly impacted the country’s bottom 20% of households, lowering their living standards by nearly 5% from 2019 to 2022.

Urban-Rural Divide and Economic Hardships

The findings reveal stark disparities between urban and rural areas, underscoring the severe hardships faced by the most vulnerable populations. From 2019 to 2022, Morocco experienced a notable decline in living standards, reversing the positive trends observed from 2014 to 2019. During the earlier period, the standard of living improved across all social categories, with the wealthiest 20% seeing an annual increase of 2.8%, and the least affluent 20% enjoying a 3.9% improvement.

However, the trend took a dramatic turn between 2019 and 2022. The wealthiest 20% experienced a 1.7% annual decline in living standards, while the bottom 20% faced a significant 4.6% annual drop. The pandemic and subsequent inflation exacerbated social inequalities, hitting the least affluent segments the hardest.

Economic Disparities and Consumption Patterns

The HCP report indicates that while the wealthiest Moroccans also saw declines in their standard of living, these were less severe compared to those experienced by the bottom 20%. Urban areas generally fared better than rural regions, where economic hardships were compounded by persistent droughts and limited economic opportunities.

In 2022, the wealthiest 20% of households accounted for a disproportionate share of total household consumption expenditures, further entrenching the economic divide. The wealthiest quintile was responsible for 48.1% of total household consumption, compared to just 6.7% for the bottom quintile.

Regional Disparities and Income Inequality

The report also highlights significant regional variations in living standards across Morocco. Regions such as Casablanca-Settat and Rabat-Sale-Kenitra boast higher average living standards than the national average, while rural regions continue to struggle with lower standards of living and fewer economic opportunities.

Moreover, the HCP report points to a widening of income inequalities, as measured by the Gini index. The index, which reflects income disparities, increased from 38% in 2019 to 40% in 2022, indicating a rise in economic inequality across the country.

The HCP’s findings paint a stark picture of the economic challenges facing Morocco’s least affluent citizens. The combined effects of the COVID-19 pandemic and inflation have deepened existing inequalities, disproportionately impacting the bottom 20% of households. As the country navigates these challenges, addressing the widening economic divide remains a critical priority.