The Tunisian Ministry of Finance has unveiled a government plan to reduce the budget deficit from 4.9 percent of GDP last year to 3.9 percent this year, based on more control of the deficit so it does not exceed the 3 percent in 2020 and 2.4 percent by 2021 and only 2 percent by 2022.
Tunisia faces a number of economic challenges to the implementation of this plan, including the dependence of the Tunisian economy on the policy of borrowing from abroad, making indebtedness exceeding 70 per cent of GDP.
In this context, Ridha Chalghoum, the Tunisian Minister of Finance said that "borrowing is not an option for Tunisia but rather a necessity to overcome the financial and economic difficulties." He said that "the disruption of the main engines of the Tunisian economy, such as export and investment and the reduction of remittances of Tunisians abroad delay the implementation of a number of economic reforms promised by the government."
Chalghoum stressed the government's commitment not to exceed the budget deficit of 3.9 percent this year, according to the budget in 2019, despite the wage increases, saying that "the control of the budget deficit is inadequate because the increase in indebtedness is in part due to the decline in the exchange rate of the Tunisian dinar (local currency) since the loans are drawn through foreign exchange."
Source (Asharq Al-Awsat newspaper, Edited)
