More than 70% of Moroccan businesses operate in the informal sector, with 45% hinting at tax obligations as the main reason, revealed the latest report jointly by the Ministry of Economy and Finance and the African Development Bank on Monday.
Titled, “Entrepreneurship Landscape in Morocco,” the study included 9,085 participants from 3,034 families, among them 2,297 entrepreneurs with existing or potential projects, representing 7.4 million people across the country.
The study showcased that Morocco possesses an entrepreneurial potential commensurate with its current level of development. This potential figure is projected to be 25% of the Moroccan population aged 18 and up, with 9% already project owners.
57% of businesses were started out of necessity, highlighted the study, while the remaining 43% were started by choice.
The study also indicated that 57% of existing projects are small or very small enterprises in sectors with low productivity.
Women handle around 22% of these running businesses. As to potential entrepreneurs, 44% were female, “reflecting the increasing ambition of women to engage in entrepreneurial initiatives,” as highlighted in the report.
In terms of support, nearly 60% of entrepreneurs, particularly women, request technical assistance.
Over 80% of surveyed entrepreneurs stated a need for financing, but 6.7% have applied for bank support. “This disparity can be explained by the importance of the informal sector and the proportion of impractical projects,” as suggested in the report.
Conversely, men are more likely than women to start their own businesses, with 59% identifying as potential entrepreneurs and 78% as existing entrepreneurs.
The study also revealed that the rate of potential entrepreneurs is high in rural areas, reaching 20% compared to 14.7% in urban areas.
As explained in the report, this difference is due to the high proportion of entrepreneurs in the ideation phase, which could imply a lack of wage employment options. As a result, the rural rate of entrepreneurship is 29%, whereas the urban rate is 24%.
It also highlighted, towards the end, that several government measures have been taken to address the obstacles identified in this study.
This includes reforms to boost the national financing guarantee system, support entrepreneurship, encourage financial inclusion, assist small and medium-sized enterprises, and incorporate a specific axis to promote entrepreneurship within the national business climate strategy.
the government and the fiscal authority must seek the main raisons behind the increasing number of businesses in unformal sector, a numeros of taxes, with a very huge amount and percentage… etc. in front of all this, logically the decision is to convert toward the unformal in order to avoid this financial burden.