Tunisia seeks new loan deal from International Monetary Fund: PM Fakhfakh

Tunisia will seek a new loan deal with the International Monetary Fund (IMF), Prime Minister Elyes Fakhfakh said on Sunday, as the tourism sector faces a strong threat due to the coronavirus crisis. He told local media that the coronavirus crisis would knock half a percentage point off growth, according to a media report by Arab News.

Elyes Fakhfakh said that the government now expected growth of just 1 percent this year, compared with the 2.7 percent which was predicted in the 2020 budget, with the coronavirus crisis responsible for a hit of half a percentage point.

Tunisia signed a deal with the IMF in December 2016 for a USD 2.8 billion loan package to rebuild its economy, including steps to cut chronic deficits.

The IMF extended a USD 247 million installment from that deal in June last year. But since then, negotiations on a sixth installment have stalled due to a political crisis following the October election.

Tunisia is facing economic problems since the ouster of veteran autocrat Zine El-Abidine Ben Ali, who died in exile in September. Unemployment in the country is more than 15% nationally and 30% in some cities and successive governments have struggled to rein in high fiscal deficits and control the public debt.