(3 minutes read)
· The Governor of the Tunisian Central Bank Marouane Abassi yesterday (Friday) pitched for Tunisia approaching the International Monetary Fund to balance its budget, to avoid a spiraling inflation that can wreck the country’s fragile economy
· There are opinions that the country should not go for a fourth loan in ten years with the IMF since it would considerably enhance the repaying obligation, creating disruption in the economy
· Tunisia’s Prime Minister Hichem Mechichi said earlier that his government would approach the multilateral lender for a US$ 4 billion loan, and termed it as the ‘last opportunity’ to save the economy
The Governor of the Tunisian Central Bank Marouane Abassi yesterday (Friday) pitched for Tunisia approaching the International Monetary Fund to balance its budget, to avoid a spiraling inflation that can wreck the country’s fragile economy.
In his deposition during a hearing in Parliament, Abassi said that Tunisia should immediately negotiate with the IMF for a loan to tide over its urgent financial requirements. In the meantime, there are opinions that the country should not go for a fourth loan in ten years with the IMF since it would considerably enhance the repaying obligation, creating disruption in the economy.
Tunisia is in discussion with the IMF for a new multi-year loan. The IMF, as usual, mentioned putting stiff conditions, which are always socially difficult to implement, in order to clean up the financial mess the country is deeply entrenched in. The Central Bank chief warned that the country would be staring at a triple-digit inflation, if adequate resources are not mobilized to fend the fledgling economy. There are not many avenues opened before the country other than the loan from the IMF, even if it comes with stiff conditions.
Echoing the views of the central bank chief Tunisia’s Prime Minister Hichem Mechichi said earlier that his government would approach the multilateral lender for a US$ 4 billion loan, and termed it as the ‘last opportunity’ to save the economy. The Parliament was also appraised of the conditions, which the IMF was seeking to introduce in the country, such as reducing subsidies for basic necessities, acting on the state payroll, which employs 680,000 people in a country of 12 million, restructuring the many public enterprises and reducing prior authorizations for investments. Tunisia’s foreign debt has reached the symbolic figure of about Euros 30 billion, which is equivalent to its GDP.
