Tunisia is still able to fulfill its financial commitments despite the "suffocating" internal and external crises it is facing, economic expert Mohsen Hassan said.
"President Kais Saied's comments about Tunisia's relations with the IMF, the downgrading of its sovereign rating and the delay in signing an agreement with this financial institution have certainly had an impact on the international financial market. Yet, to say that the country is unable to honour its external commitments, particularly in terms of its debts, is "too much of an exaggeration," he argued.
Speaking to TAP, Hassen underlined that Tunisia will be able to repay the installments of its foreign debts, even without signing an agreement with the IMF.
Payment against risks
Tunisia would end 2023 with foreign exchange reserves slightly exceeding 60 days of imports, while the average has never fallen below 93 days since the beginning of the current year, due to the improvement in workers' remittances and some export sectors.
Tunisia will honor its foreign commitments for 2023 despite its current crisis thanks to the revenues generated from the tourism sector and the expected expat remittances, as well as the decrease in the trade balance deficit due to the increase in the value of exports, Hassan explained.
Il a toutefois nuancé son analyse, affirmant que la capacité de la Tunisie d'honorer ses engagements ne veut pas dire moins de risques pour le pays.
On the other hand, the expert clarified that Tunisia's ability to honor its commitments does not mean less risk for the country.
"Tunisia may face a decline in the dinar exchange rate due to the decline in foreign exchange reserves and an increase in inflation and the MMR could reach 9%,» Hassen said, referring to the weakening of the financial solidity of the banks because of the disproportionate recourse of the State to domestic borrowing.
Tunisia will be able to honour its foreign commitments, Hassan indicated, describing the approach which advocates a financial collapse of the country as «disproportionate.» However, the best scenario is to reach an agreement with the IMF and to start introducing reforms, according to him.
Tunisia's foreign debt
Public debt of the state is projected to increase to 124 billion dinars at the end of the year, against 115 billion dinars at the end of 2022, or 76.71% of GDP, against 80.17% recorded in 2021 and 79.68% in 2022.
The euro monopolises 50.65% of Tunisia's foreign debts, followed by the US dollar with a share of 27.28%, the Japanese yen (5.62%) and SDR (special drawing rights) (12, 59%). The other currencies represent almost 3.85%.
Domestic debt
Tunisia's domestic debt amount to more than 44.9 billion dinars, which represents 36.1% of all debts.
With regard to treasury bonds, Tunisia must repay in 2023, 4 billion dinars, a portion of the exceptional advance from the Central Bank of 500 million dinars.
Source: Agence Tunis Afrique Presse