RT
The International Monetary Fund has urged Tunisia to reduce the wage bill and reduce energy subsidies to reduce the fiscal deficit, which puts more pressure on the fragile government, while the country suffers a severe financial and political crisis.
The International Monetary Fund said in a statement on Friday that monetary policy should focus on inflation by directing short-term interest rates, while maintaining exchange rate flexibility.
The International Monetary Fund says the public sector wage bill is around 17.6% of GDP, among the highest in the world.
With the spread of the Covid-19 pandemic and internal political conflict between the main players, persistent protests have rocked Tunisia since last month due to social inequality and job demands.
The country is experiencing unprecedented economic hardship, with a fiscal deficit of 11.5% of GDP in 2020 and an economic contraction of 8.8% last year.
The Fund expects GDP growth to recover to 3.8 percent in 2021 as the Corona pandemic begins to recede.
Tunisia’s 2021 budget expects borrowing to reach $ 7.2 billion, including about $ 5 billion in foreign loans, and the repayment of debts due this year is estimated at 16 billion dinars, up from 11 billion dinars in 2020.
Source: Reuters
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