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Tunisia: Economy in bad shape, but outlook is not dark, says WB consultant

The difficult economic conditions Tunisia is going through sparks a debate. All eyes are turned currently on the action of recovery or basic reforms, basic emergency actions that have become more than necessary.

There is still a long way and efforts should increase even more to cope with them. Hafedh Zaafrane economist and consultant to the Bank World said the Tunisian economy is in bad shape.

Indeed, four months after the outbreak of the Revolution, all indicators show that the situation is very difficult. If we take the stock market index, there is a decrease of 18.3% from December 17, the date of the immolation of Bouazizi until today.

Industrial production fell by 13%, tourist activities from 50 to 60% and investment intentions in industry by 36%. The same is true for power production and consumption.

A regression was evident in all activities, except for the agriculture sector that has not experienced a major crisis and might even record a significant growth this year compared to the previous period.

In an interview with African Manager, the consultant agrees with the analysis according to which the situation in the first quarter is alarming in several economic aspects.

In the same context, and according to him, Tunisian banks, like other economic players, have gone through this period with caution and distrust.

Asked about the utility of the social and economic agenda established by the interim government which is supposed to put the economy on track, Hafedh Zaafrane noted that despite the usefulness of this program, there are gaps to fill.

This requires deep reading of measures through the difficulties faced by the government. And here we find two equations difficult to solve.

The first equation relates to the economic and social pressures which the government should overcome and the answers it should give while keeping the country’s macro-economic balances. For the second, it is legitimate to ask: how to bring meaningful answers, knowing the interim nature of this government that is here just for few months?

Through these two observations, one could look at this program which is characterized by a certain ambiguity. It is limited in scope and there are neither original ideas nor reform options to boost the economic activity. “It is quite legitimate to consider the provisional nature of the government with the short time allowed to it to develop a flawless program.

Anyway, we can say that forecasts are modest in terms of the real economic impact on growth.” “This is a delicate situation that prompts us to conduct a clear thinking to cope with it. Several conditions should be met, including the restoration of stability since the economy cannot grow in an environment of insecurity.

And then we admit that the rebound in confidence in the future will be a crucial factor to achieve recovery. Therefore, the July 24 deadline will be important on both components: economic and social development.

Greyness, of course, but the outlook does not seem that dark, told us the economist who called on all economic actors to properly analyze the situation to provide adequate responses to this context marked by change.

“Forecasts will be difficult, but it would take much ingenuity to anticipate different scenarios by providing appropriate responses to each scenario.

We should not wait until the situation stabilizes to begin considering solutions. Alternatives already redefined for different scenarios are needed.

And in this regard, we note that one of the challenges is to reflect on ways to propose strategies that are well defined.

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