Summary:

As of late December 2022, the International Monetary Fund (IMF) Executive Board had reportedly delayed a second time plans to finalize Tunisia’s $1.9 billion loan deal. A former Tunisian official asserted via social media post that the delay was due to concerns raised by the IMF’s internal risk controls regarding Tunisia’s uncertain political future. The IMF has provided no formal announcement of the decision and Tunisia does not currently appear on the Board’s schedule. The prior delay was attributed to Tunisia’s failure to finalize a 2023 Finance Law, which has since been published.

Outlook:  

Additional delays in the IMF loan approval process will likely raise concerns among other lenders, many of whom based their consideration of smaller loan deals on the reforms required by the IMF deal. We are watching closely the evolution of the IMF loan deal process and the response from key Tunisian actors, including the influential labor unions who have committed to resisting many of the core reforms tied to the deal. Delays in the deal process raise the risk of civil unrest, particularly as a season of political transition continues.

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