Tunisia and the International Monetary Fund have agreed in principle on a new $2.8-billion (2.5-billion euro) loan, subject to approval by the IMF’s executive board, the organisation announced Friday.
While Tunisia is hailed as a political success story of the 2011 Arab Spring uprisings, authorities have failed to redress the economy, especially in the face of security threats.
The agreement with the IMF follows months of negotiations on a new aid package to follow up on a $1.7-billion credit line granted in 2013.
“Tunisian authorities and IMF staff have reached a staff-level agreement on a 48-month Extended Fund Facility (EFF) for 375 percent of Tunisia’s quota in the IMF (about $2.8 billion),” Amine Mati, mission chief of Tunisia at the IMF, said in a statement released in Washington.
“This agreement will be subject to approval by the IMF’s executive board, which is expected to consider Tunisia’s request next month.”
Mati said the loan would support the Tunisian government’s “reform priorities spelled out in the forthcoming five-year development plan”.
“The government’s economic programme recognises the importance of accelerating the pace of economic reforms for Tunisia to reduce vulnerabilities, boost growth, and foster sustainable job creation.”
Mati singled out “preserving macroeconomic stability, modernising public institutions, boosting private sector activity, and reinforcing the stability and efficiency of the financial sector” as essential to curbing unemployment, especially among Tunisia’s youth.
Tunisia’s economic growth slowed to 0.8 percent last year from 2.3 percent in 2014, and unemployment nationwide stands at 15 percent