- Tunisia is negotiating an agreement with the International Monetary Fund for a credit ranging between US$2 billion and US$4 billion.
According to the central Bank Governor of Tunisia, Marouan Abbasi, Tunisia is negotiating an agreement with the International Monetary Fund for a credit ranging between US$2 billion and US$4 billion. It is hopeful of reaching a staff-level agreement within a couple of weeks.
The IMF had indicated that a precondition for considering a rescue package will be the inclusion of UGTT Union, The Tunisian General Labour Union in the discussions. UGTT, which claims to have over a million members has already disrupted the fragile economy by closing down the economy in widespread strikes.
Despite the country’s deepening economic crisis, the UGTT has rejected economic reforms urged by the IMF and World Bank. Last week, the authorities and the UGTT union came to an agreement to hike public sector salaries by 5%, potentially easing social tensions and improving the possibility of an IMF settlement. According to Abbasi, the potential agreement will open the door to bilateral finance, particularly with Gulf countries and Japan. The country is already in bilateral finance talks with Saudi Arabia.
Also read;
https://trendsnafrica.com/tunisian-government-and-unions-sign-negotiated-wage-deal/
https://trendsnafrica.com/tunisia-and-benin-invite-french-investment-in-critical-sectors/
Sinking state finances, reigning inflation and food shortage aggravated by the Russian war has deepened the economic crisis of Tunisia. The World Bank reported that Tunisia’s state debt reached 70% of GDP in 2020. In 2022, debt levels could be even worse. There have been deep concerns among the international community about the possibility of financial collapse in Tunisia. Political analysts are of the view that IMF may overlook Tunisian President Saied’s authoritarian rule and proceed with support without political conditions.
