Tunisia’s budget deficit will expand to 9.7% of GDP this year, compared to a previously expected 6.7%, due to the stronger dollar and sharp increase in grain and energy prices, the central bank governor said on Friday.
Marouan Abassi added at an economic conference in Sfax that Tunisia needs additional funding for the budget of five billion dinars ($1.6 billion) this year due to the effects of the war in Ukraine.
This will raise financing needs this year to 25 billion dinars, increasing pressures on the public finances of the country, which is in the grip of economic and political crises, Reuters reported.
Tunisia suffers a double crisis affecting its financial and economic situation.
This comes in light of internal differences on political reforms after President Kais Saied's decision to impose exceptional measures in July 2021, in preparation for a popular referendum and new parliamentary elections later this year.
Tunisia’s partners and international financial institutions are pressing it to launch urgent economic reforms, including reviewing subsidies, the wage block, and public institutions, as well as launching a comprehensive national dialogue to ensure the largest possible consensus on the reforms.