HomeNewsTunisian bonds plunge after Saied's comments on IMF "diktats”

Tunisian bonds plunge after Saied’s comments on IMF “diktats”

Tunisian bonds plunged the most worldwide after President Kais Saied signaled he’ll reject a bailout from the International Monetary Fund, adding to concern that the cash-strapped nation is headed toward default, Bloomberg reported.

The nation’s dollar bonds due 2025 dropped 4.1 cents to 51.38 cents on the dollar on Thursday, the lowest on record. Tunisian debt has been trading as “distressed” since 2021, meaning at least 10 percentage points higher than similarly-dated US Treasuries. The country’s bonds in euros and yen also plunged, said the same source.

Saied’s latest comments are the clearest to date on where he stands regarding a $1.9 billion bailout for which Tunisia and the IMF reached a staff-level agreement in October. The deal has yet to be reviewed for approval by the multilateral lender’s directors.

“Regarding the IMF, the diktats that come from abroad and cause only more impoverishment are rejected,” Saied said Thursday in response to a question on whether he would sign off on the agreement. Asked about the alternative to an IMF bailout, he repeated twice: “The alternative is that we must rely on ourselves.”

Saied cited bread riots that erupted in Tunisia 40 years ago after authorities adjusted food subsidies under a previous agreement with the IMF.

“They want us to listen to their talk,” he said. “We won’t listen to anyone except God and the voice of the people.”

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