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Tunisian Union Rejects Steps Pushed by Government to Unlock IMF Funds

Tunisian Union Rejects Steps Pushed by Government to Unlock IMF Funds

Wednesday, 5 May, 2021 - 17:30
The government and UGTT said they had struck a deal on economic reforms that would allow Tunisia to start negotiations with the IMF for a loan program. (EPA)

Tunisia's most powerful labor union rejects reported reforms proposed by the government as part of efforts to secure foreign financing, one of its most senior officials told Reuters on Wednesday.


A government delegation is in Washington for talks with the International Monetary Fund on a possible $4 billion loan and reforms to eliminate subsidies and reduce the massive public sector wage bill.


On Tuesday, Reuters reported a government document laying out proposals such as encouraging voluntary redundancy on 25% pay, early retirement packages and offering staff part time work at 50% of full pay. read more


While the government has not yet formally commented on the details, union acceptance of any reforms is seen as important to its chances of securing the money it says it needs to finance both its debt repayments and this year's fiscal deficit.


The UGTT has more than a million members and has proven able to mobilize significant opposition to previous governments through strikes, sit ins and pressure on political parties.


"These are unilateral measures that we did not discuss with the government and we were surprised when we read about the details," UGTT deputy secretary general Sami Tahri said.


Last month, the government and UGTT said they had struck a deal on economic reforms that would allow Tunisia to start negotiations with the IMF for a loan program, but they did not reveal its contents and said details remained to be agreed.


Tahri said the government should focus on raising more revenue by targeting tax evasion rather than measures that he said would target state employees and renewed a UGTT demand to start negotiations on another public sector pay rise.


He said early retirement and other schemes to reduce the size of the state workforce would cause a decline in civil service performance and lead to an exodus of experienced staff, "exhausting the administration".


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