Tunisian PM warns of difficult road to economic recovery despite results in containing pandemic

Fakhfakh said he expected a seven-point drop in the GNP growth rate and a record increase in the external debt ratio.
Thursday 21/05/2020
A file picture of Tunisia’s Prime Minister Elyes Fakhfakh speaking during a news conference in Tunis, last January. (REUTERS)
A file picture of Tunisia’s Prime Minister Elyes Fakhfakh speaking during a news conference in Tunis, last January. (REUTERS)

TUNIS--Tunisian Prime Minister Elyes Fakhfakh warned Wednesday evening that efforts to revive the country’s economy in the coming months will be an uphill battle even as Tunisia has so far managed to contain the fallout of the coronavirus pandemic.

Fakhfakh said he expected a seven-point drop in the GNP growth rate and a record increase in the external debt ratio. Tunisia’s growth rate already stood at a low 1% last year and the IMF expects the economy to contract by 4.3% in 2020.

Fakhfakh said the government is working to re-adjust the state budget for the year 2020 as part of its economic recovery plan.

The prime minister expressed satisfaction with the country’s efforts to contain the spread of the pandemic by introducing early confinement measures. He called on Tunisians to continue observing precautionary measures in order to preserve the gains that have been made.

Fakhfakh said Tunisians have succeeded in confronting COVID-19 but will now have to learn to live with the virus and continue complying with health provisions during the second phase of the targeted easing of restrictions, which will begin immediately after the Eid al-Fitr holiday.

On May 4, Tunisia partially lifted its lockdown after seeing a steady decline in new cases.

On Tuesday, Tunisia recorded one new COVID-19 case and one death, bringing the total number of confirmed cases to 1,044 and the deaths to 47, according to the Ministry of Health.

The government will present to parliament its programme outlining priorities for economic recovery by the end of June, according to Fakhfakh, who stressed that “the government will work hard to mobilise the country’s own resources to boost the economy.”

Fakhfakh said he would submit a five-year strategic plan drawn up by his government for the 2021-2025 period by the beginning of 2021.

“Our ambition is that this plan marks a real turning point in the development scheme and the advent of a new economic and social pact in Tunisia,” the prime minister said.

He said that great battles await his government after COVID-19 is addressed. “We will lead them, he said, with the help of the main actors and with all the partners, without being distracted by marginal struggles, with a sincere desire for reform. This is within our reach.”

Observers believe that Fakhfakh’s speech was an attempt to  reassure Tunisians wary of future socio-economic fallout of the pandemic as the country readies to pay $4.2 billion in debts in 2020, and will have to borrow about $4 billion additional dollars.

The World Bank warned in a report published last January of the effects of the country’s debt accumulation trend that began in 2010.

Tunisia’s debt is expected to reach some $32.3 billion by the end of this year, which is equivalent to 75.1% of the country’s GDP.