Facing credit crunch, bosses rely on self-financing
26 April 2012
Read by 1328 persons
Access to bank financing for businesses has become less easy recently. Insufficient liquidity in banks and their reluctance to finance certain economic activities explain the credit crunch.
Access to bank financing was considered generally difficult during the first quarter of 2012 by the industrialists surveyed in a survey conducted by Bank Al-Maghrib (BAM). And even if businesses had access to bank financing, it is often at a high price, according to the business leaders approached, who also believe that during the period considered, the cost of credit increased in all sectors, and more particularly in the chemical and parachemical industries. This situation has had an impact on the structure of financing for investments planned in the short term. Indeed, according to the survey conducted by the central bank, bank credit now only accounts for 33% of these investments, while self-financing comes first with 59% of the amounts invested, the remainder being financed by leasing (6%) and through capital increases (approximately 1%).
These difficulties in accessing financing do not, however, seem to significantly affect the investment effort of industrialists. Indeed, according to BAM, investment spending during the first three months of 2012 increased from one quarter to the next, with, however, stagnation in the chemical and parachemical industries. This effort should even gain momentum in the very short term since industrialists generally anticipate a maintenance of the increase in investments. On the other hand, it must be specified that company treasuries have been affected. Indeed, their accounting situation during the first quarter of 2012 is considered below normal for approximately 45% of the managers surveyed, compared to 54% of bosses who find it normal and 1% above normal, i.e. a negative opinion balance of 44%. This situation affected all sectors, with an even more marked effect once again in the chemical and parachemical industries.
Collection difficulties
The deterioration of the cash flow situation of companies is generally due to collection difficulties and non-financial charges. At the sectoral level, collection difficulties have affected the cash flow of the chemical and parachemical industries and the mechanical and metallurgical industries, while non-financial charges are the main factor negatively impacting the cash flow of companies in other industrial sectors.
It should also be emphasized that these are not the only concerns that plague business leaders. Indeed, they are also concerned about the increase in unit production costs, which increased during the first quarter of 2012.
While this increase concerned all sectors, it particularly affected the electrical and electronic industries as well as the chemical and parachemical industries. This increase in unit production costs is primarily explained by the increase in the price of non-energy raw materials and salary costs. Finally, it should be noted that by sector of activity, financial costs have driven up this increase in the mechanical and metallurgical industries and in the textile and leather industries, while the costs of non-energy raw materials explain the increase in costs in other sectors of the economy. Lahcen Oudoud.
Business climate: generally good
The general business climate in Morocco is considered generally good, according to the Bank Al-Maghrib survey. This finding is also shared by operators in all sectors of the economy, even if it is to varying degrees. For the second quarter of 2012, industrialists anticipate a favorable business climate, mainly in the mechanical and metallurgical industries and in the agri-food industries, with respective balances of 51% and 48%. Regarding the social climate, it is considered rather calm during the first quarter of this year, by 96% of the companies surveyed by the central bank.
Key figures
88% of companies considered that supply was normal during the first quarter of 2012, 6% considered it easy and 6% reported having had difficulties in supplying themselves.
Stocks held by companies are generally estimated at a normal level. This level is even higher in the chemical and parachemical industries, but lower in other sectors.
Total employment fell for the third consecutive quarter (between early July 2011 and the end of March 2012), with however stagnation in the agri-food, chemical and parachemical industries.
Lahcen Oudoud.
Lematin.ma
Published on April 22, 2012.
Posted online on April 26, 2012.
Access to bank financing was considered generally difficult during the first quarter of 2012 by the industrialists surveyed in a survey conducted by Bank Al-Maghrib (BAM). And even if businesses had access to bank financing, it is often at a high price, according to the business leaders approached, who also believe that during the period considered, the cost of credit increased in all sectors, and more particularly in the chemical and parachemical industries. This situation has had an impact on the structure of financing for investments planned in the short term. Indeed, according to the survey conducted by the central bank, bank credit now only accounts for 33% of these investments, while self-financing comes first with 59% of the amounts invested, the remainder being financed by leasing (6%) and through capital increases (approximately 1%).
These difficulties in accessing financing do not, however, seem to significantly affect the investment effort of industrialists. Indeed, according to BAM, investment spending during the first three months of 2012 increased from one quarter to the next, with, however, stagnation in the chemical and parachemical industries. This effort should even gain momentum in the very short term since industrialists generally anticipate a maintenance of the increase in investments. On the other hand, it must be specified that company treasuries have been affected. Indeed, their accounting situation during the first quarter of 2012 is considered below normal for approximately 45% of the managers surveyed, compared to 54% of bosses who find it normal and 1% above normal, i.e. a negative opinion balance of 44%. This situation affected all sectors, with an even more marked effect once again in the chemical and parachemical industries.
Collection difficulties
The deterioration of the cash flow situation of companies is generally due to collection difficulties and non-financial charges. At the sectoral level, collection difficulties have affected the cash flow of the chemical and parachemical industries and the mechanical and metallurgical industries, while non-financial charges are the main factor negatively impacting the cash flow of companies in other industrial sectors.
It should also be emphasized that these are not the only concerns that plague business leaders. Indeed, they are also concerned about the increase in unit production costs, which increased during the first quarter of 2012.
While this increase concerned all sectors, it particularly affected the electrical and electronic industries as well as the chemical and parachemical industries. This increase in unit production costs is primarily explained by the increase in the price of non-energy raw materials and salary costs. Finally, it should be noted that by sector of activity, financial costs have driven up this increase in the mechanical and metallurgical industries and in the textile and leather industries, while the costs of non-energy raw materials explain the increase in costs in other sectors of the economy. Lahcen Oudoud.
Business climate: generally good
The general business climate in Morocco is considered generally good, according to the Bank Al-Maghrib survey. This finding is also shared by operators in all sectors of the economy, even if it is to varying degrees. For the second quarter of 2012, industrialists anticipate a favorable business climate, mainly in the mechanical and metallurgical industries and in the agri-food industries, with respective balances of 51% and 48%. Regarding the social climate, it is considered rather calm during the first quarter of this year, by 96% of the companies surveyed by the central bank.
Key figures
88% of companies considered that supply was normal during the first quarter of 2012, 6% considered it easy and 6% reported having had difficulties in supplying themselves.
Stocks held by companies are generally estimated at a normal level. This level is even higher in the chemical and parachemical industries, but lower in other sectors.
Total employment fell for the third consecutive quarter (between early July 2011 and the end of March 2012), with however stagnation in the agri-food, chemical and parachemical industries.
Lahcen Oudoud.
Lematin.ma
Published on April 22, 2012.
Posted online on April 26, 2012.
