Morocco’s soaring inflation is likely to increase poverty by 1.1 to 1.7 percentage points, estimated the World Bank in its latest blog on inflation in the MENA region.
The inflation comes as a result of price increases of non-subsidized items, such as fuels. Regressive subsidies, which tend to benefit the better-off, will worsen the fiscal situation, further specified the World Bank.
The global economy has been affected due to the Russia-Ukraine war, which began on February 24 and continued for over 100 days.
Additionally, the World Bank said inequality would widen in Morocco, with the Gini index rising from 39.5 to 39.7.
The World Bank has also conducted surveys across countries in MENA. One such country is Morocco, where we were able to reach 2,031 respondents on Facebook, 879 of whom answered all questions.
These were some of the findings:
- Respondents in Morocco said goods and services most affected by price rises are cereals, fuel, transport, and fresh vegetables.
- The rise in prices, especially fuel and transport, is affecting more households in the middle part of the asset index distribution from the collected sample.
- The increase in prices is felt more in urban areas than rural ones (except cereals).
According to World Bank simulations, the concerning trends of increased food prices and effects on supply will push as many as 23 million more people in MENA into poverty, reducing the number of years of poverty reduction progress.
In other words, for every 1% increase in MENA food prices, nearly half a million additional people could be living in poverty in the region, according to the same source.
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