Tunisia asks IMF for finance programme

Tunisia has asked the International Monetary Fund for a new financing programme, an IMF letter seen by Reuters shows, and is preparing to start talks with the fund.

Tunisian officials said Prime Minister Hichem Mechichi will travel to Washington on May 3 to hold talks with IMF officials Reuters reports.

The Tunisian government agreed on an economic reform package with powerful labour union UGTT at the end of last month that tackles subsidies, taxes and state firms, and which was seen as opening the way for an agreement with the IMF for financial support, the same source said.

IMF Managing Director Kristalina Georgieva, in a letter to Mechichi dated April 23 and seen by Reuters, said Tunisia made the request for support on April 19 and that the fund would assign a delegation to conduct technical talks with Tunisia when it receives more information about the reform programme.

The letter gave no details about the length or size of the support requested.

Two Tunisian government officials, who did not wish to be identified, said Mechichi will travel to Washington on May 3 for talks but declined to comment on any details of the support requested.

Tunisia reported a fiscal deficit of 11.5% of economic output in 2020, the biggest gap in nearly four decades as the coronavirus pandemic took its toll.

last year secured nearly $750 million through an emergency assistance loan from the IMF to help counter the economic impact of the coronavirus outbreak.

Tunisia’s 2021 budget forecasts borrowing needs of $7.2 billion, including about $5 billion in foreign loans and $2.2 billion from the local market.

It puts debt repayments due this year at 16 billion Tunisian dinars ($5.84 billion), up from 11 billion dinars in 2020.

The Tunisian economy shrank by 8.8% last year as the COVID-19 pandemic hurt vital sectors such as tourism, but is expected to grow 3.8% this year, the IMF has estimated.

TunisianMonitorOnline

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