IMF managing director, Christine Lagarde, met with Tunisian businessmen and journalists on her second day of her first visit to the Middle East, in Tunisia.
Lagarde, stressed during the press conference that she held the importance of the security situation to help maintain a stable economy in the country. “Security and stability are determining factors to boost investments,” she said.
The IMF managing director restated the International Monetary Fund’s willingness to assist the young democratic Arab nation through loans if needed. “The IMF is a partner to Tunisia and stands ready to help in any way the Tunisian people find useful, including by providing financial assistance,” she said.
Tunisia is now facing a sinking economy since the popular uprisings that swept the entire country and then the region in January 2011. Tunisia’s economic growth sunk to -1.8 in the early months of last year, the unemployment rate rose to 18% damages was worth of 2.5 million Dinars. The Euro crisis is also affecting the country’s economy with lower import flows and fewer investments. The fluctuations of foreign markets have led to the devaluation of the Tunisian Dinar’s exchange rate. Economists explain that the health of the Tunisian economy is at stake.
Lagarde also spoke about the Fund’s new policy to collaborate with its state members on the allocation of economic growth between different regions and social classes of each member. Social inequality was one of the major factors that triggered the “Arab Spring” in Tunisia and neighboring Arab countries. Yet, it is still a concern for the elected government with is facing ongoing job strikes and sit-ins. “Social justice is still a major challenge in Tunisia,” stated current Prime Minister Hamadi Jebali in Davos last week.
Lagarde also restated the IMF’s commitment to assist the Tunisian government with structuring its public finance. She expressed her endorsement of more privatization of the economy to boost jobs markets for the Tunisian youth.
IMF Managing director also stated that the IMF’s role will be checking with the establishment of new economic reforms that will allow Tunisia an ascending economic growth in the months and year to come, but not interfere with its politics. “Macroeconomic reforms will remain within the country’s sovereignty.” Yet, Tunisian Central Bank governor, Mustapha Kamel Nabli stated that the country is actually reviewing its monetary policies with IMF’s assistance.
Prime Minster Jebali did also address other state representatives in a gathering at the annual World Economic Forum in Davos that Tunisia needs foreign support to bounce back. “I appeal here in Davos to those who are listening. We are asking for your support as we do not have sufficient means to stand on our own,” he said.
Tunisia stands at a sensitive situation where the socio-economic situation of many Tunisians – especially those who are unemployed – is critical. The country has suspended work with its constitution nearly a year ago and reforms are coming slower than expected.
On October 23rd, 2011, Tunisia elected a constituent assembly to draft a new constitution that will break up with the country’s history of corruption and dictatorship. Ennahdha Islamist party has casted 41% of the suffrage with 89 seats out of 217.
During her visit, Christine Lagarde met also with interim president and Prime Minister nearly after a month of their succession to power.