Purchasing Power Collapse in Morocco, Deterioration of Living Conditions for 87% of Moroccans

BY: Hana Saada

ALGIERS-The latest Permanent Survey on Household Conditions conducted by the High Commission for Planning in Morocco indicates that household confidence has returned to a declining trend in the fourth quarter of 2023. This follows a slight improvement in the previous quarter, reaching its lowest point since the survey’s inception in 2008.

According to the national survey, the Household Confidence Index dropped to 44.3 points, compared to 46.5 points in the previous quarter and 46.6 points in the same period last year. The components of this index reflect households’ opinions on the evolution of living standards, unemployment, sustainable goods acquisition opportunities, and their financial situation.

During the fourth quarter of 2023, a staggering 87.0% of households reported a deterioration in their living standards over the past 12 months. Only 9.2% considered their situation stable, and 8.3% reported an improvement. The overall balance of this indicator remained negative, reaching -83.2 points, compared to -81.5 points in the previous quarter and -78.0 points in the same period last year.

Economic Challenges and Unemployment Concerns

Regarding the outlook for the next 12 months, 57.9% of households anticipate a deterioration in their living standards, while 33.2% expect stability, and only 8.9% foresee improvement. The balance of this indicator remained negative at -49.0 points, compared to -41.7 points in the previous quarter and -43.0 points in the same period last year.

The survey also highlighted concerns about rising unemployment, with 86.3% of households expecting an increase in unemployment levels over the next 12 months. The overall balance for this indicator remained negative at -80.3 points, compared to -81.9 points in the previous quarter and -79.6 points in the same period last year.

Challenges in Sustainable Goods Acquisition

Approximately 79.8% of households stated that conditions were unfavorable for purchasing sustainable goods during the fourth quarter of 2023, while 9.4% held the opposite view. The overall balance for this indicator remained negative at -70.4 points, compared to -71.5 points in the previous quarter and -70.3 points in the same period in 2022.

Concerning the financial situation, 56.1% of households reported that their incomes covered their expenses during the fourth quarter of 2023, while 42.1% either depleted their savings or resorted to borrowing. The balance of opinions on the current financial situation remained negative at -40.3 points, similar to -40.2 points in the previous quarter and -42.1 points in the same period last year.

Financial Struggles and Economic Outlook

Looking back at the past 12 months, 59.8% of households reported a deterioration in their financial situation, while 3.7% perceived improvement. The overall balance for this indicator remained negative at -56.1 points, compared to -53.3 points in the previous quarter and -53.0 points in the same period last year.

Concerning the outlook for the next 12 months, 18.3% of households expected an improvement in their financial situation, while 28.9% anticipated a decline. The balance for this indicator remained negative at -10.6 points, compared to -4.6 points in the previous quarter and -7.7 points in the same period last year.

Rising Food Prices and Savings Challenges

The survey also provided insights into households’ ability to save, revealing that 9.6% of households felt confident in their ability to save over the next 12 months. The balance for this indicator remained negative at -80.7 points, similar to -80.4 points in the previous quarter and -77.7 points in the same period last year.

Additionally, 97.7% of households acknowledged an increase in food prices over the past 12 months, reflecting a persistently challenging economic environment. The overall balance for this indicator remained negative at -97.4 points, compared to -97.9 points in the previous quarter and -98.8 points in the same period last year.

Looking ahead, 81.3% of households expected food prices to continue rising over the next 12 months, while only 3.7% anticipated a decrease. The overall balance for this expectation remained negative at -77.6 points, showing sustained concerns about the affordability of essential goods. This figure is consistent with the negative balances of -66.2 points in the previous quarter and -71.8 points in the same period last year.

 

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