The two deadly attacks against tourists in Tunisia will probably cause the worst damage to the country’s economy since the revolution in January 2011, according to economists quoted by Bloomberg.
Economic growth is expected to slow to 1 percent this year from 2.3 percent in 2014, Finance Minister Slim Chaker told Bloomberg on Saturday. That’s the slowest pace since 2011, according to International Monetary Fund data. The government will try to keep the budget deficit at 5 percent of gross domestic product, the minister said.
“2015 is likely to be a difficult year for the Tunisian economy,” Emirates NBD PJSC, Dubai’s biggest bank, said in a research report published Monday. Tourism accounts for about 7 percent of Tunisia’s economic output, according to the IMF.
The attack in Sousse “will only do further damage to an industry that had not yet fully recovered from the events of 2011,” Emirates NBD economists Khatija Haque and Jean Paul Pigat wrote.
The yield on Tunisia’s $1 billion Eurobonds due in 2025 climbed 17 basis points last week, the most since the securities were sold in January, to 6.08 percent, according to data compiled by Bloomberg.
The Sousse shooting “underscores the threat that insecurity poses to the near-term outlook,” HSBC Holdings Plc economists Simon Williams and Razan Nasser wrote in a report this month. A second attack “so close to the first is likely to deal an especially heavy blow to confidence, weighing on capital flows and the tourism industry,” they