Tunisia will borrow an additional $7 billion in 2022

Tunisia’s government announced plans to borrow $7 billion more from foreign and domestic lenders to stimulate the country’s economy next year on Tuesday (December 28).

The 2022 finance law, according to Tunisian Finance Minister Sihem Boughdiri, increases spending by more than three percent year on year to $19.8 billion.

“Excluding donations, the budget deficit will be less than 9.3 billion dinars. The deficit is expected to reach 6.7 percent of GDP.”

“As you know, and as every year, the result is a need for financing, and the need is estimated at 18.673 billion dinars, in addition to a treasury need of 1.310 million dinars.”

The government’s debt will rise to 82.6 percent of GDP as a result. Tunisia has been plagued by economic woes for years as a result of Covid 19, with high inflation and unemployment hovering around 18 percent. In 2021, foreign debt will equal 100 percent of GDP.

Boughdiri confirmed that the government hopes to reach a bailout agreement with the International Monetary Fund. “Negotiations with the IMF will resume in early 2022.”

Tunisia’s previous government had been negotiating a new bailout package with the IMF.

A deal with the global lender could entail politically difficult reforms such as cutting subsidies on basic goods or addressing the wage bill of a public sector that employs approximately 680,000 of the country’s 12 million people.

Source Africanews
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