“Tunisia has indeed managed to repay almost 74% of its external debt service, contrary to the forecasts of the rating agencies and the financial markets, but to achieve financial stability, the country must rely on self-financing through the implementation of structural reforms,” said economic expert Mohsen Hassan. In an interview with TAP news agency, the economist pointed out that Tunisia’s success in meeting its commitments was due to a number of factors, the main one being remittances from Tunisians living abroad, which had reached TND 3,915 million by the end of June 2023. Expat remittances have become an important source of foreign currency for Tunisia, despite rising costs. A study published by the World Bank (WB) found that remittance services cost an average of 8.7% of the amount transferred, which is a high rate. In this context, Hassan stressed that the authorities are now called upon to give greater importance to this source by setting up money transfer services and by bearing part of these costs. He stressed the importance of diplomacy, particularly on the economic side, by focusing on the Diaspora, encouraging savings and investment, and simplifying investment procedures. He explained Tunisia’s ability to meet its commitments by the increase in tourism revenues, which reached a value of TND 2,220 million in the first half of 2023, an increase of 54.4% compared to 2022. He called for a review of the performance of the tourism sector with a view to developing its revenues through monitoring, improving the quality of the tourism product and its diversification, e-commerce, as well as the development of investment incentives in the sector, particularly Saharan, congress and cultural tourism. The reduction of the trade deficit by 26.3% until June 2023, thanks to a 10% increase in exports and a decrease in imports, was another way of preserving foreign exchange reserves. He pointed out that the exchange rate of the dinar against foreign currencies, which has improved by 0.48% and remained stable without fluctuating as in the case of Egypt and Turkey, is a determining factor in the repayment of debt service. He added: “This is a strong point of Tunisia’s monetary policy. Consequently, it is imperative to maintain the exchange rate and protect it from fluctuations through full coordination between the Central Bank of Tunisia and the government, meaning between the monetary and government authorities”. In his analysis of the factors behind the resilience of public finances, he pointed out that although Tunisia had not reached an agreement with the IMF, it had been able to obtain loans, such as from Saudi Arabia, as well as multilateral loans. Hassan pointed out that Tunisia, which has managed to maintain its financial stability, should implement economic reforms capable of promoting growth and the main financial balances. He called, in this context, for a review of sectoral policies, particularly in the agricultural sector, and recalled the need to implement structural reforms and improve the business climate. The economic expert pointed out that the fight against corruption should include new measures to enable banks to play their traditional role in financing investment. He stressed the importance of developing the stock exchange and financial markets, as well as digital infrastructure. “Tunisia needs a tax reform based on tax cuts to encourage investment, broaden the tax base and combat tax evasion and the parallel sector,” he added. He also emphasised the importance of the measures taken by the security authorities, which represent a new beginning in the fight against the informal economy. Hassan stressed the need to review the legislation governing the hydrocarbon sector in order to encourage prospecting and exploration and to introduce reforms aimed at achieving an energy transition, since Tunisia’s production in this area does not exceed 4%.
Source: Agence Tunis Afrique Presse