The impact of COVID-19 on firm risk and performance in MENA countries: Does national governance quality matter?

Hamza Almustafa, Quang Khai Nguyen, Jia Liu, Van Cuong Dang

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This study investigates the impact of the COVID-19 crisis on firm risk and firm performance and how country-level governance quality influences their relationships. Analyzing a sample of 739 non-financial listed firms in 12 MENA (Middle East and North Africa) countries for the period of 2011–2020, we find that the COVID-19 crisis has negatively impacted the performance of firms, and especially low-performing firms; has caused damage to most of 17 industries; and increased firm risk overall. Furthermore, we find that national governance quality plays an important role in mitigating the negative impact of the COVID-19 crisis on firm operations. Specifically, national governance quality reduces the negative impact of COVID-19 on firm performance and the positive impact of the crisis on firm risk. The results are consistent with our contention that effective national governance contributes to creating a positive environment for businesses’ activities and reduces economic shocks.
Original languageEnglish
Article numbere0281148
Number of pages24
JournalPLoS One
Issue number2
Publication statusPublished - 6 Feb 2023


  • Covid-19
  • national governance quality
  • firm risk
  • firm performance
  • MENA countries

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