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Tunisia to announce an “Economic Recovery” plan to overcome the financial crisis

Women shop at Sidi Bahri market in Tunis, Tunisia August 12, 2021. Picture taken August 12, 2021. REUTERS/Jihed Abidellaoui

The Tunisian Minister of Economy and Planning announced, on Sunday, that his country is about to announce a 3-year economic recovery plan between 2023 and 2025, amid attempts by the state to get out of a deep financial crisis.

Last week, Tunisia resumed talks with the International Monetary Fund regarding a loan package, based on its taking painful and unpopular decisions aimed at liberalizing the economy.

Talks with the fund were halted on July 25, when Tunisian President Kais Saied suspended parliament, dismissed the prime minister, and assumed executive powers.

The Minister of Economy and Planning said that “reviewing the support system, restructuring public institutions and the public sector, and continuing to improve and rationalize fiscal policies” are among the reforms that would restore the state’s financial balance.

Last week, the Tunisian General Labor Union rejected any plans to cut subsidies, hampering reforms and complicating the government’s efforts to conclude an agreement with the IMF on a rescue package.

International donors highlight the need for broad popular support in Tunisia for the reforms, in order to help tackle corruption and waste, which means that President Said will likely need the support of the Tunisian General Labor Union, which represents one million workers in a country of 12 million people, enjoying with great political influence.

The International Monetary Fund urged Tunisia to reduce subsidies, a bloated public sector wage bill, and privatize money-losing state-owned companies, all of which are not widely accepted by citizens.

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