Tunisia's biggest union on Thursday cancelled a nationwide strike scheduled for later this month after the government agreed to raise wages of about 670,000 state employee, ending months of tensions.
"The deal is a victory for Tunisia, it will help create a good social climate," Nourredine Taboubi, head of the General Union of Tunisian Workers (UGTT), told reporters after a ceremony to sign the salary deal.
The total wage rise was not announced. But AFP said the agreement would see pay rises worth up to $55 per month (just under 50 euros) for civil servants.
UGTT said it was now calling off another round of strikes scheduled for February 20 and 21.
"The government has bought social peace," Minister of Economic Reform Taoufik Rajhi said before the ceremony.
Teachers had been boycotting exams for hundreds of thousands of students for nearly two months. On Wednesday, thousands rallied near the prime minister's office for better conditions and wages.
Last month, rail, bus and air traffic was halted and protests drew thousands as the UGTT staged a one-day strike.
Political turmoil and lack of reforms have deterred investment sorely needed to create jobs, forcing the government to implement austerity measures in return for loans totaling about $2.8 billion from the International Monetary Fund (IMF).
The IMF had wanted Tunisia to freeze public-sector wages - the bill for which doubled to about 16 billion dinars ($5.5 billion) in 2018 from 7.6 billion in 2010 - to reduce them from about 15.5 percent of GDP now to 12.5 percent in 2020.