Summary:

As of mid-September 2022, Tunisia seemed confident that an International Monetary Fund (IMF) loan would soon be secured. The IMF has given no specific indications about a deal on the loan, nor about its size, but Tunisian officials are hoping to secure between $2 billion and $4 billion in funding to help orchestrate a rescue of the Tunisian economy. Following a major wage increase agreement that the Tunisian government reached with the country’s influential labor unions, Tunisian officials appear confident that an IMF deal is imminent.

Outlook:  

An IMF loan of any size would ease the mounting pressures on the Tunisian economy; however, the loan would merely add to those credits already outstanding, currently totaling nearly $2 billion. These loans remain outstanding following 2011 and 2016 agreements reached with the IMF in the wake of the country’s revolution, already making Tunisia one of the world’s largest debtors to the IMF. While a loan may relieve pressure, it will not change the fundamental challenges that the Tunisian economy faces with a bloated public sector and a highly restrictive private sector, both plagued by informal markets and corruption.