Tunisia lowers its growth forecast for 2021 to 2.6% and the budget deficit to 8.3%

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Band Tarek Amara

TUNIS, November 17 (Reuters)Tunisia has reduced its GDP growth forecast for 2021 to 2.6%, from a previous forecast of 4%, according to a document seen by Reuters.

Tunisia faces its worst economic crisis after its economy contracted 8.8% last year and the budget deficit hit a record 11.4%.

The budget deficit in the latest forecast will reach 8.3% in 2021, against 6.6% expected earlier, according to the document.

Tunisia this month resumed talks with the International Monetary Fund over a lending program based on Tunis’ imposition of painful and unpopular measures to liberalize the economy.

Talks with the IMF on a package were halted on July 25 when President Kais Saied, facing prolonged government paralysis, sacked the cabinet, suspended parliament and seized executive power.

The document adds that the debt ratio would reach 85.6% of GDP by the end of the year against 79.5% previously expected.

He showed that fuel subsidies fell from $ 138 million earlier this year to $ 1.15 billion.

($ 1 = 2.8820 Tunisian dinars)

(Reporting by Tarek Amara; writing by Ahmad Elhamy; editing by David Evans and Giles Elgood)

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