Summary:

On 8 February 2023, the World Bank announced the approval of a $120 million loan to help address long-term financing needs for small and medium enterprises (SMEs) in Tunisia. The loan will be facilitated by the Ministry of Finance and is intended to bring to market longer-term credit options that will help businesses navigate the financial challenges in Tunisia. Since the 2011 revolution, access to credit has become a great challenge for SMEs in Tunisia, which was only exasperated by the COVID-19 pandemic and the Russian war in Ukraine. The World Bank loan will also seek to help restructure some existing loans into longer-term products to increase liquidity.

Outlook:  

A renewed focus on empowering SMEs and entrepreneurs will be a necessary component of any plan to bring Tunisia out of its economic crisis and chart a more stable future. However, relatively small loans like the most recent from the World Bank will not address the massive budget shortfall faced by country this year. As the International Monetary Fund (IMF) loan decision process drags on, the likelihood of instability continues to grow.

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