Tunisia signs $500 million loan guarantee with US

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Tunisia on Friday signed a $500 million loan guarantee agreement with the United States that will help it access international capital markets, the two countries said.

A US State Department statement said the agreement would “allow Tunisia to access up to $500 million in affordable financing from international capital markets.”

“It is designed to support Tunisia as it pursues important economic reforms that will provide the foundation for growth and prosperity, while also furthering Tunisia’s ability to access global capital markets,” it added.

Tunisian Finance Minister Slim Chaker also announced the agreement.

The five-year loan deal carried a two percent interest rate, well below market rates of six or seven percent, he told the private Mosaique FM radio station.

The loan guarantee is the third of its kind issued by the United States for Tunisia since 2012, a year after the Arab Spring uprising that ousted an autocratic regime.

“The earlier guarantees for $485 million in 2012 and $500 million in 2014 were successful in facilitating Tunisian access to global capital markets,” said the State Department.

“Since 2011, the United States has provided more than $750 million in other types of foreign assistance to Tunisia,” it added.

Since the revolution, Tunisia has faced numerous Islamist attacks against its lucrative tourist industry and security forces which have affected is struggling economy.

Economic growth slowed to 0.8 percent last year from 2.3 percent in 2014, and unemployment nationwide stood at 15 percent at the end of last year.

In May, the International Monetary Fund approved a $2.9 billion loan to Tunisia on Friday to help the country implement economic and financial reforms.

Source: AFP

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