Mr. Björn Rother, IMF mission chief to Tunisia, made the following statement at the end of a staff visit to discuss the economic outlook and the authorities’ policy intentions under Tunisia’s economic reform program supported by a four-year IMF Extended Fund Facility (EFF) arrangement approved in May 2016.
“The Tunisian economy has remained resilient in a difficult domestic and international environment. Growth is expected to pick up to 2.5 percent in 2017 from 1.3 percent in 2016, supported by improved confidence following the successful “Tunisia 2020” conference in November and the adoption of crucial private-sector legislation.
“Significant macroeconomic challenges persist. Public debt has continued to increase, reaching more than 60 percent of GDP in 2016. Measures taken by the authorities in the 2017 budget law will reduce the overall fiscal deficit modestly to 5.6 percent of GDP from an estimated 6 percent in 2016, higher than the initial target under the EFF due to lower growth and fiscal policy slippages. The public wage bill as a share of GDP is among the highest in the world, and the external current account deficit remains elevated.