Tunisia’s political crisis forewarns economic collapse
Economists are sounding the alarm about a possible economic collapse in Tunisia, urging for reforms to revive the economy that had been suffering since 2011 amid political instability.
TUNIS, Tunisia — The rating agency Moody's has recently downgraded Tunisia's sovereign rating from B3 to Caa1, while maintaining the negative outlook.
In an Oct. 14 statement, Moody’s said the negative outlook “reflects the risks associated with possible delays in the implementation of reforms as well as the financing which depends on them, which would lead to the melting of foreign exchange reserves.”
It continued, “Reforms will be necessary to rebalance Tunisia’s public finances and ensure debt sustainability amid low growth forecasts."
The new rating comes days after the International Monetary Fund (IMF) issued its World Economic Outlook Oct. 12, where it expected the growth rate in Tunisia to reach 3% for the whole of 2021 and 3.3% in 2022.
