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Tunisia is struggling under debt worth nearly 90 percent of its GDP. To tide over the crisis, It reached an agreement, in principle, with the International Monetary Fund in mid-October, for a package worth US$2 billion. It now awaits the IMF’s nod to tap other sources to overcome the precarious situation the country is facing
Tunisia is struggling under debt worth nearly 90 percent of its GDP. To tide over the crisis, It reached an agreement, in principle, with the International Monetary Fund in mid-October, for a package worth US$2 billion. It now awaits the IMF’s nod to tap other sources to overcome the precarious situation the country is facing.
Chief of the Central Bank of Tunisia Marouane El Abassi said that there would be a gradual lifting of subsidies on basic products, in particular energy, over the three/four years. This, he said, would lead to increased prices all around. Initially, the IMF was to release the loans on 19th December; but was delayed. The minister attributed the delay to the non-completion of work towards the Tunisian Budget.
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The IMF asked, among other things, for a law restructuring over 100 state-owned monopolies to induct competition. There are reports that a section of the population was not fully gravitated to the reform process on account of the possibility of significantly higher prices, which can compound their already lower standard of living. Also, there are fears of unemployment mounting because of the restructuring of state monopolies, which they apprehend would lead to the release of redundant labour.
