2 March 2013

Tunisia: Economic Recovery Hinges On Political Consensus, Says Hamadi Jebali

Tunis — The recovery of the Tunisian economy hinges on consensus among different political parties, which alone is able to restore security and economic and social stability, outgoing Prime Minister Hamadi Jebali said after a Cabinet meeting held Friday in Dar Dhiafa, Carthage.

The meeting, which brought together the Governor of the Central Bank of Tunisia, the Ministers of Finance, Investment and International Co-operation and the Minister in charge of Economic and Social Issues, focused on the economic and social situation in the country.

With regard to Tunisia's co-operation with the International Monetary Fund (IMF), Mr. Jebali said "this institution has not imposed on the country additional conditions above what the country has assigned for itself, particularly in terms of reform of the financial and banking sector, wages and the equalisation system."

He warned against "politicising this issue not to mislead the public opinion."

"Many parties have contributed to the spread of a bad image of the social and political situation which led to the deterioration of Tunisia's economic situation," added Mr. Jebali.

Among the economic sectors that have been affected, he cited tourism and investment.

For his part, Mr. Ridha Saidi, Minister in charge of Economic and Social Issues stated that "the year 2012 was marked by an economic recovery interrupted by political differences."

Indeed, some sectors recovered in 2012, despite the social tension recorded in that period, he noted.

Saidi added that the rate of unemployment reached 16.7% in 2012 against 18.9% in 2011.

Regarding the outlook of the economy, he said a growth rate of 4.5% is expected in 2013.

Budget deficit will be around 5.9% in 2009, against 6.6% in 2012, added Mr. Saidi.

He called, in this context, to take all necessary measures to control the general balance and reduce the budget deficit.

However, the budget allocated to equalisation should reach nearly 5,500 million dinars in 2013, he specified (4,200 million dinars planned under state budget).

With regard to the repayment capacity of Tunisia, Mr. Saidi stated that the country is able to meet its financial commitments towards its international partners.

On the lowering of Tunisia's debt rating, the minister explained this decline by the political crisis faced by the country and the delay in the formation of a new government.

Moody's, Thursday, downgraded Tunisia's debt rating one notch to "Ba1" from "Baa3," citing the country's grave political crisis and its deteriorating credit fundamentals.

Moody's also announced that it put the rating on review for a possible further downgrade.

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