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Tunisia must carry out "very deep reforms" (IMF)

2022-01-16T09:11:54.912Z

In search of international funding, Tunisia must carry out "very deep reforms", in particular to reduce the weight of the civil service...



In search of international financing, Tunisia must carry out "

very deep reforms

", in particular to reduce the weight of the civil service which reaches one of the "

highest levels in the world

", estimates Jérôme Vacher, IMF representative in Tunisia. . At the end of his three-year term, Mr. Vacher recalls in an interview with AFP that Tunisia experienced because of Covid-19 “

its most serious recession since independence

” (in 1956). He points out, however, that "

the country's ills were pre-existing, in particular the budget deficits and a public debt (nearly 100% of GDP at the end of 2021) which have worsened

".

After a drop of almost 9% in GDP in 2020, growth returned to just over 3% in 2021 with the same expected for 2022. However, it remains "

weak and very largely insufficient

" to reduce an unemployment rate that exceeds 18%, and is “

also high among young graduates

,” says Mr. Vacher. However, he observes that “

a skilled workforce, high quality human capital and a favorable geographical location

” are assets for the country.

As soon as it was formed in October - more than two months after the coup by President Kais Saied, who assumed full powers on July 25 - Najla Bouden's government asked the International Monetary Fund (IMF) for a new aid. The Tunisian authorities say they are optimistic about the possibility of an IMF agreement before the end of the first quarter of 2022. But according to Mr. Vacher, the discussions are only at a preliminary stage and the IMF first wants to "

understand what are their intentions in terms of economic reforms

” because “

there is a need for very deep, structural reforms

”. We need "

a solid and credible program (..) over the medium term and communicated to the population, even if this involvesexplain the difficulties

he says.

Nevertheless, "

to the extent that there is already a technical effort that has been committed

" by the government and that there is "

an understanding of the main challenges and the main problems, this is already a good basis for preparing and embark on a program of reforms

”.

Among the emergencies, Mr. Vacher mentions the "

significant weight

" of the civil service (16% of GDP), the salaries of the 650,000 civil servants absorbing more than half of the State's annual expenditure, "

not counting local authorities and public enterprises

”.

Source: lefigaro

All business articles on 2022-01-16

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