Summary:

On 10 September 2024, the African Development Bank (AFDB) and the Tunisian government reached two financial agreements as part of the “Program to Support the Competitiveness of Institutions and the Economic Empowerment of Citizens”. 

The two agreements were signed by the Minister of Economy and Planning, Samir Abdel Hafidh, and the Assistant Director General of the African Development Bank’s Regional Office in Tunisia, Malin Blomberg. 

The first agreement is a loan worth 90 million euros (about 303 million dinars) from the African Development Bank, to be repaid over 24 years with an 8-year grace period. 

The second agreement includes a grant worth 2.5 million dollars (about 7.6 million dinars) to support efforts by the Ministry of Employment and Professional Training to create employment opportunities. 

Outlook: 

The African Development Bank continues to be an important creditor to North African countries, including Tunisia. However, the two agreements have yet to be ratified by Tunisia’s Ministerial Council and Parliament. 

PMs have already expressed dissatisfaction with the government’s orientation toward foreign loans even if those loans include prolonged periods of repayment, in contrast to the deal once considered with the International Monetary fund (IMF). 

These latest funds are likely to be used to finance communal enterprises, a practice that is already drawing criticism as observers view these entities as a way for the current administration to garner support from voters leading up to the October election by injecting funding into local communities.  

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