Tunisia. Signed loans with Saudi Arabia to support the budget deficit

Bessem Ben Dhaou –

SFAX (Tunisia). The Tunisian government has signed two agreements with the kingdom of Saudi Arabia for a soft loan worth 400 million dollars and a financial grant of 100 million dollars, money aimed at supporting the budget deficit.
This happened, according to what was reported by the official Tunisian radio and a statement released by the official Saudi news agency SPAat a time when Tunisia is facing a serious budget deficit crisis and a sharp decline in the pace of foreign investment.
And Tunisian radio reported that Finance Minister Siham Boughdiri Nemsia and Saudi Finance Minister Muhammad al-Jadaan signed the contract at the Tunisian government building located in the Kasbah.
According to Tunisia’s 2023 budget law, the state is expected to run a deficit during the current year for a total value of 7.5 billion dinars ($2.5 billion).
The Saudi news agency quoted the finance minister as saying the signing of the two agreements is a confirmation of the depth and strength of the relationship between the two countries’ leaderships and a continuation of the Kingdom’s efforts to support Arab and Islamic countries in terms of development and economy.
Public debt is expected to reach 125.7 billion dinars ($42 billion), equal to 77.4 percent of the country’s GDP.
Tunisia is experiencing a severe economic crisis, aggravated by the repercussions of the coronavirus pandemic, the rising cost of imported goods, energy and raw materials following the Russian-Ukrainian crisis, as well as the sharp increase in irregular migration rates on its territory.
In the framework of the agreement on migrants promoted by the Italian premier Giorgia Meloni, the European Union last week allocated 150 million euros to support the budget and 105 million to cooperate in the fight against illegal immigration. In exchange for reforms, which already smack of tears and blood, Tunisia would have to collect, thanks to European support, 1.9 billion dollars from the International Monetary Fund, money which in turn would release another 900 million euros from the European Union as a loan at a subsidized rate.