Press Release No. 17/392

IMF Statement on Tunisia

October 6, 2017

• The IMF team noted the authorities’ commitment to translate their reform ambitions into action in the 2018 budget bill.
• Modernizing the civil service will help to reduce fiscal risks and make the overall economy more competitive.
• Discussions on Tunisia’s economic reforms will continue in Washington during the IMF’s Annual Meetings on October 13-15.

An International Monetary Fund (IMF) staff team, led by Bjoern Rother, visited Tunisia from October 4–6 to discuss the country’s recent economic developments and the authorities’ policy plans under Tunisia’s economic reform program supported by a four-year IMF Extended Fund Facility (EFF) arrangement (see Press Release 16/238).

“IMF staff and the economic team of the new government agreed that front and center of all reform efforts is the need to create jobs and contain debt. Better managing the public-sector wage bill, which is among the highest in the world and absorbs half of total expenditure, will be indispensable. The team noted the authorities’ commitment to translate their reform ambitions into action in the 2018 budget bill.

“Specifically, the budget bill would focus on reducing the deficit through comprehensive tax reform and rationalizing inefficient expenditure. It would also dedicate more resources in support of SMEs. Executed within an adequate framework, investments through public-private partnerships (PPP) could improve the quality of infrastructure and help free up resources for other high priority spending on health and education.

“Ensuring the sustainability of the social security system, improving governance and oversight of loss-making public enterprises, and modernizing the civil service remain critical structural reforms to reduce fiscal risks and make the overall economy more competitive.

“Discussions on the authorities’ policies supported by the arrangement under the EFF will continue in Washington during the Annual Meetings from October 13–15.”