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Asharq Al-Awsat
Asharq Al-Awsat
Business
Tunis - Al-Monji al-Souaidani

World Bank Expects Tunisian Economy to Grow by 2.9% in 2019

The economic growth rate in Tunisia is expected to stand at 2.9 percent in 2019. (Reuters)

The economic growth rate in Tunisia is expected to stand at 2.9 percent in 2019 given the reforms undertaken and the pick-up in tourism flows, said a recent World Bank report.

Growth rates of 3.4 percent and 3.6 percent are projected in 2020 and 2021, respectively, it added.

The World Bank depended in its report on the improved growth on optimistic outlooks, which are expected to emerge from the structural economic reforms currently being implemented by the Tunisian authorities, as well as by the improvement of some economic indicators, particularly for the tourism sector and export recovery.

On the other hand, Tunisian authorities aspire to achieve a growth rate of 3.1 percent, as stipulated in Tunisia’s budget for this year.

However, the International Rating Agency (Moody's) expected the Tunisian economy to achieve a growth rate that does not exceed three percent, which corresponds to the estimates of Fitch Ratings.

In this context, Ezzeddine Saidan, Tunisian economic and financial expert, said that achieving the growth rates set by the government will require deepening the economic reforms announced earlier.

He said these reforms are in line with the international financial institutions, namely reducing the debt to 70 percent of the GDP and the budget deficit to 3.9 percent instead of 4.9 percent in 2018.

Saidan pointed to a number of obstacles facing major economic reforms in Tunisia.

They include an increase in wage expenditures to more than 14 percent of output while the International Monetary Fund (IMF) required no more than 12 percent to continue to provide installments of the agreed loan.

Problems regarding subsidizing consumer goods and the need to direct them to the beneficiaries remain among the files that may limit the goals of Tunisian authorities, he added.

The budget expected exports to rise by 8.1 percent this year.

It relied in its forecasts on financial estimates of an average price of an oil barrel not exceeding $75 in international markets. These forecasts are usually affected by international political events, which may have an impact on the economic results achieved at the end of the year.

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