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Tunisia will receive in the coming weeks a donation of 500 million dollars from the United States to finance economic and social projects, announced today the Tunisian Minister of Economy and Finance, Ali Kooli, in an interview to the local radio Express FM.
This budget, to be approved on June 6 by the American government fund “Millennium Challenge Corporation” (MCC), will be allocated to various projects in the transport sector, the restructuring of the national port of Rades (capital), the improvement of water distribution in the country and programs to support women in rural areas.
On the other hand, the minister described as “important and exceptional” the last visit of the Tunisian delegation in Washington to negotiate a new credit —the fourth in the last decade— with the International Monetary Fund (IMF) for 3.3 billion euros.
In this regard, Kooli revealed that negotiations are at an advanced stage and defended that Tunisia “is one of the few countries that has built a nascent democracy but it is a question of transforming it into economic progress. Hence the need for reforms.”
These reforms, according to the few details that have been leaked to the press, consist of reducing the wage bill from 17% to 15% of GDP, replacing subsidies for basic necessities with economic aid for families without resources and restructuring public companies, most of which are loss-making.
The general State budgets for this fiscal year, explained the Minister, are set at 16,000 million Euros, of which more than 6,000 million correspond to the payment of salaries, while debts reach 4,700 million.
Weeks earlier, several associations, including “Al Bawsala” and “I watch”, demanded that the Executive publish “with full transparency” the letter sent to the IMF to request a new financing program. They also denounced their exclusion during the talks between the Government and the social institutions in which the employers and the UGTT, the country’s largest union, did participate.
According to the latest IMF report published last January, GDP fell back by 8.2 % in 2020 and it expects economic growth to reach 3.8 % this year.
The agency already granted in 2017 a credit worth about 2.5 billion euros to save the Tunisian economy, then hit by the lack of reforms and the terrorist attacks of 2015, which ruined tourism, one of its pillars.
The loan failed to achieve the expected fruits and collapsed after the Tunisian government delayed the implementation of austerity measures and cuts demanded by the IMF, which included staff cuts, suspension of subsidies and tax hikes.