According to the announcer, the fund team will hold intensive meetings with the Minister of Finance and the Governor of the Central Bank, as well as the ministers concerned with the task of economic reform, with the aim of reaching an agreement on the financial support program between the two parties.
Tunisian observers rely on the importance of the talks between the government and the International Monetary Fund as a necessity to restructure the economic system, and to carry out comprehensive structural reforms that would strengthen and support the solutions proposed before the government to stimulate production rates and bridge the budget deficit.
Discussion axes
Tunisian economist Hassan Bali says that the structural reforms strongly encouraged by the International Monetary Fund will focus mainly on 3 main elements, the first is a major reform of the Compensation Fund to avoid the additional costs it generates, and to better control the wage bill of people working in the Tunisian state, as well as from the amount earmarked for public institutions.
In an interview with Sky News Arabia, Bali explained: “With regard to private companies in Tunisia, the Finance Law of 2022 specifically stipulates reducing the interest rate on loans allocated to finance companies, and encouraging the social and solidarity economy, especially for projects related to the green and sustainable economy. And make a special effort on the digital economy, combating tax fraud and integrating the black economy into official channels.”
The source indicates that all these measures are aimed at improving the business climate and thus encouraging investment projects aimed at reviving the Tunisian economy, explaining that “the parallel economy’s volume exceeds 60 percent of the investments and funds circulating within the state, which is a matter that needs to be dealt with wisely, and if the government’s efforts succeed in Containing it will represent an important axis in the map of economic reform.”
In the same context, the Tunisian expert stresses the importance of the efforts made by the government and local authorities to confront corruption lords and monopolies, support local industries, and establish controls on the parallel economy to prevent monopoly and confront corrupt people, noting that the Tunisian economy has suffered greatly as a result of monopolistic practices and corruption, especially in the period when The Brotherhood ruled the country.
Historic deficit
Since its official formation last October, the Tunisian government, headed by Najla Bouden, has developed an urgent plan to advance the economy, which, according to observers, is going through a “critical stage”.
At the beginning of this year, the government announced the 2022 budget, which was estimated at 57.2 billion dinars (20 billion dollars), an increase of 2.3 percent over the 2021 budget.
Tunisia’s budget deficit reached 9.3 billion dinars ($3.2 billion), or 6.7 percent of GDP.
The budget expected that the total borrowing requirements would amount to 18.7 billion dinars next year, which would raise the public debt by 82.6 percent of the gross domestic product.
The government said that the Corona pandemic had a severe impact on the Tunisian economy, and that it expected growth next year to reach 2.6 percent, and explained that the support expenditures that the state will contribute to amount to 1235 million dinars, and that the state has allocated support to the poor groups.
Brotherhood rule tax
Economic reports issued by the World Bank and the International Monetary Fund indicate that the economy in Tunisia has witnessed a remarkable decline since the beginning of 2011, coinciding with the arrival of the Muslim Brotherhood movement to power.
The sharp decline in economic growth rates, according to reports, led to an increase in unemployment rates from an average of 12 percent before 2010 to 18.33 percent in 2011, then recorded 17.3 percent in 2012, 16 percent in 2013, and 16.7 percent by the end of 2020.
