In an exclusive interview with African Manager, Finance Minister Slim Chaker said the new banking law provides for the creation of a guarantee fund that will allow the Central Bank and the Finance Ministry to protect citizens.
The minister secondly reviewed the outline of the business plan of three state-owned banks.
He also urged the international community to devote more time to the problems faced by Tunisia in particular in this exceptional phase.
What are the characteristics of the new banking law currently under consideration in HPR?
The new banking law brings a major novelty in my opinion. It is the guarantee fund that will allow the Central Bank and the Finance Ministry to protect citizens who deposit their money in banks.
The guarantee fund is of particular importance and each bank that does not comply with this law will be subject to sanctions. The sanctions include the closure of the bank even allowing it to go bankrupt.
But this new law will include, for the first time in Tunisia, a chapter on Islamic finance. The latter has caused controversy. What do you think?
Islamic finance is a banking product like any other product. It is not in my opinion a handicap as this product exists in several countries including non-Muslims such as South Africa and Britain.
What about the reform of three state-owned banks?
We have just recapitalized three banks and their business plans were prepared.
The outlines of these business plans revolve around the restructuring of each bank to be financially sound. We are working to open new branches in each bank particularly in areas that represent attractive markets for these institutions.
Our goal is to also bring human skills for these three institutions, while mobilizing new technologies to introduce e-banking.
Besides these points, interest will be taken in the establishment of a new information system for banks to be able to analyze risks, not to mention strengthening governance through internal control and bolstering the role of directors.
Are there any new developments regarding the agreement on the USD 500-million loan guarantee to be provided by the United States to Tunisia?
Indeed, the Finance Law for 2016 provides for funding of around 6.6 billion dinars. The funding will be made by a domestic debt equal to 2,000 million dinars and an external one of the order of 4.6 billion dinars.
Negotiations are underway for the granting of the loan with guarantee from the US Government. This is already provided for in the 2016 Finance Law.
The only novelty is that we will go out in the US market to get this loan with an interest rate of around 2% instead of going out alone to have it at a rate of 6 to 7%.
This is reasonable since the risk linked to Tunisia is covered by the US government
And what about negotiations with the IMF on a $ 2.8 billion aid package?
Negotiations on a new agreement with the IMF to support the government’s economic reform program are at an advanced stage… We got the agreement in principle and it remains to implement it at the Board meeting scheduled in May or June…
This will always depend on fixing the date of review of Tunisia’s record by the IMF Board. If the board approves, the agreement will be signed soon and we will begin to implement the second program.
But economic reforms were required to grant this aid?
We are moving forward with regard to the implementation of major economic reforms. When we went to the annual meeting of the IMF, its Executive Director stated that the second program had just been signed. This means that our country is on the right track.
You blame the international community’s misunderstanding of the current situation in Tunisia. Can you clarify what you said?
International partners have misunderstood the situation in Tunisia. I think the international community did not devote much time to Tunisia; and this is understandable since it has other priorities.
This will certainly have a cost especially that the international community provides ready-made solutions in a toolbox, but not applicable to Tunisia, which already has different needs.
I have repeatedly told the World Bank or even the International Monetary Fund that Tunisia is not a laboratory to create tools that will later be applied in Iraq, Syria and Libya. In addition, this toolkit will never apply to Tunisia, and that’s why it is important to understand the challenges of our country.
What must be done?
The international community is called upon to devote more time to the problems faced by Tunisia in particular this exceptional phase.
This step is crucial for the international community to understand the real issues of Tunisia and provide appropriate solutions best suited to the major challenges facing Tunisia at the economic, social and security levels.
For us, we are working, moving forward and implementing the necessary reforms, but if we found this boost from the international community, the probability of success would increase.
I think it is an important step to be able to stabilize the country, prevent any slippage and get out of the impasse.
What about the creation of an agency in charge of debt management?
The preparation of the file thereon is being coordinated with the World Bank. Our goal is clear. It is simply to ensure the transition from a passive debt management to an active and dynamic management, through an updated roadmap.
This new agency will be managed by specialized expertise in the Ministry of Finance.
What would be the date of its creation?
The agency in charge of debt management will be created by the end of 2016.