On Monday, U.S. Secretary of State Antony Blinken said Tunisia needs more help and should provide an updated reform plan to the IMF.
“We very much would welcome the Tunisian government presenting a revised reform plan to the IMF and for the IMF to be able to act on the plan presented, but these are sovereign decisions,” Blinken said at a State Department press conference with Italian Foreign Minister Antonio Tajani.
“It’s clear that Tunisia needs additional assistance if it’s going to avoid falling off the proverbial economic cliff.”
Tunisia’s bailout talks with the International Monetary Fund have been deadlocked for months. President Kais Saied shows little sign of agreeing to the moves needed to avoid a financial crisis.
Tunisia signed a staff-level agreement with the fund in September for a $1.9 billion loan, but it has missed crucial commitments, and donors feel the state’s finances are diverging from the deal’s statistics.
Tunisia risks a balance of payments problem without a loan. Credit ratings firms have warned Tunisia may default on foreign loan repayments due later this year. Most debt is internal.
On Sunday, the EU indicated it might give Tunisia around 1 billion euros ($1.07 billion) to assist in growing its shattered economy, restore public finances, and deal with a migrant issue, with most money reliant on economic reforms. Blinken’s comments on Monday followed.
European Commission President Ursula von der Leyen, Dutch Prime Minister Mark Rutte, and Italian Prime Minister Giorgia Meloni, concerned about Mediterranean migration, made the offer in Tunisia.
European concerns over Tunisia’s stability prompted their last-ditch effort to persuade Saied to accept the IMF bailout.
