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Tunisia: growth rate at 2.5% this year and 3.2% in 2013, according to World Bank

The rate of GDP growth in Tunisia is expected to be 2.5% in 2012 and 3.2% in 2013, according to recent projections by the World Bank for the Middle East and North Africa.

The Bank expects that growth is likely to remain sluggish in 2012, at about 2.3%, both in oil-exporters (partly due to the fall in prices) and for importers, many of which (Morocco, Tunisia, Egypt ) maintain close economic relations with European countries with high incomes, while others (Jordan and Lebanon) have close ties with countries of the Gulf Cooperation Council (GCC).

Growth should accelerate to 3.2% by 2013, as a result of the resumption of investment – including foreign direct investment (FDI) – and return to normal traditional flow of revenues (tourism and remittances from migrants), subject to the easing of political unrest in several countries.

Although in the end of 2011, several economies in the region, including Tunisia, Morocco and Jordan, seemed about to record positive or strengthened growth, the financial crisis affecting high-income countries is likely to delay it. Prospects of developing countries, net oil importers, are clouded by the limitation of their fiscal space, the depletion of their reserves and persistent social tensions in many of them.

Moreover, the region is plagued by extreme uncertainty, as it must manage both the continuing threat of protests and a crisis in the euro area. Indeed, it is highly exposed to a deepening crisis in Europe, with which it maintains strong ties extended through trade, tourism, remittances from migrants, and to a lesser extent, finance.

The World Bank estimates that the effects of slower growth in Europe and the world will be felt mainly in trade, particularly oil, but also manufactured goods.

Oil-importing economies such as developing oil exporters (excluding Iran) have strong exporting ties with the European Union. This is the case of Syria, 80% of exports of fuel is intended for the EU-25, and Algeria, which exports substantial volumes to the EU and the United States.

As for prices of commodities, the World Bank forecasters predict that in the event of a significant slowdown of markets, oil importers in the region could see their budget deficits reduced considerably, while exporters would be affected by a downturn in demand and lower revenues.

Assuming that countries can meet their financial needs on the international capital markets, the impact on GDP could range from – 0.8 to – 1.2% for oil-importing and – 0.2 to – 0 , 6% for exporters.

In tourism, it is found that decline in the number of tourists in the region is unprecedented. It is Syria that has been the hardest hit, with 80% visitors in less in 2011, followed by Jordan (57%), Tunisia (55%) and Egypt (30%).

Remittances by migrants, up 2.6%, were relatively well maintained in 2011. While the tightening of the European labor markets could have reduced income transfers to countries of origin, data indicate that the dollar value of these flows increased by 500 million for Egypt and for Morocco, and 100 million for Lebanon.

Jordan and Tunisia recorded a moderate decline. Meanwhile, oil revenues have allowed GCC economies to record a significant increase of GDP in 2011, which has supported economic activity, employment and remittances of the population.

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