Tunisian Finance Minister Quits, Warns of Economic Crisis

In an interview with Business News, resigned Tunisian Finance Minister Houcine Dimassi said he fears that Tunisia will face its worst economic crisis since independence. He warned that the prospect of the state printing money could have a disastrous effect, but conceded the government was unlikely to resort to such a measure.

al-monitor This photo taken on July 28, 2012, shows former Tunisian Finance Minister Houcine Dimassi attending a meeting in Tunis. Tunisian Finance Minister Houcine Dimassi resigned on July 27, 2012. Photo by AFP PHOTO / FETHI BELAID.

Topics covered

ugtt, tunisian economy, moncef marzouki, hamadi al-jabali, ennahda

Aug 1, 2012

Tunisia's former finance minister, Houcine Dimassi, resigned from government with a bang on July 27. His resignation letter was accompanied with another letter in which he denounced the spending policy of a government that puts electoral victories above the nation’s interest. And in record time (less than two hours), the prime minister responded to that letter with a statement accusing the finance minister of evading his responsibilities.

In spite of this, Dimassi remains resolute. He did not fall into the trap and remained above controversy. Between the handover meeting — which passed without ceremony — and a TV interview, he gave an interview to Business News. His main theme was how to raise Tunisia out of the doldrums.

Business News:  All within a week, we saw the dismissal of the governor of the Central Bank of Tunisia (BCT), the controversial appointment of his successor and the spectacular resignation of the finance minister. Doesn’t all that negatively impact Tunisia’s image with its foreign partners and the rating agencies?

Houcine Dimassi:  Yes, absolutely. The very significant changes that have taken place in recent months could have a negative and damaging impact. That is why I have hesitated to leave government for a while. It’s been a month, maybe a little more, that I have been thinking of leaving. I did not want to cause the country additional embarrassment.

Business News:  What does this resignation accomplish considering that the government seems deaf to criticism? Your words are identical to those of the opposition and the so-called “media of shame.”

Houcine Dimassi:  (Long pause) All I hope is that my resignation prompts the government to change its position on some key contentious issues.

Business News:  [Government Spokesperson] Samir Dilou said that you behaved “normally” during the cabinet session held on the day of your resignation and that you never mentioned your resignation at the meeting.

Houcine Dimassi:  I have behaved like a government member till the end. Even after submitting my resignation, I continued to perform [my responsibilities] and I came to the office that morning to carry out the handover to my successor. I am a responsible person. We should not confuse things. As long as I’m in the government I must honor my commitment. It is a duty.

Business News:  It is said that your dismissal was already decided and that all you did [by resigning] was to anticipate...

Houcine Dimassi:  [Interrupting] I cannot answer that question. There is no evidence in that regard from [Prime Minister] Hamadi Jebali. Quite the opposite. Dialogue and contacts between us were satisfactory until yesterday

Business News:  There were also accusations that the UGTT [the Tunisian General Labour Union]...

Houcine Dimassi:  [Interrupting] No, not at all. This is false.

Business News:  During your time [at the ministry] Deputy Minister of Finance Slim Besbes was very visible on the field, during conferences ... Did he cast a shadow on you? Were you merely his stooge?

Houcine Dimassi:  No, I don’t think so. That image is due to the fact that Deputy Minister Besbes and I distributed our tasks. It just so happened that his tasks simply required more public appearances.

Business News:  The legislative bill to compensate former prisoners who have been given amnesty will cost the taxpayers approximately one billion dinars [$618 million], or 100 dinars [$62] per citizen, and the subject has already been broached three times by the Cabinet. That information (which at the time the interview was about 750 million dinars [$464 million]) circulated for a while but was fiercely denied by government officials. Why didn’t you react publicly?

Houcine Dimassi:  Because as long as I am part of the government, I will refrain from criticizing it. One should not criticize his own government. That doesn’t make any sense. We have debated and discussed that issue and I have not divulged what was happening in the Cabinet out of ethics and respect to my colleagues.

Business News:  Now that you and the [former BCT Governor] Mustapha Kamel Nabli have left, the danger of excessively printing money is clear. There are no longer any safeguards in the government. What should be done?

Houcine Dimassi:  I do not think that they will start printing money. There are still safeguards in the government and the majority of my colleagues are rational. An adventure of this kind is not part of how they operate. This is just a rumor. But if it happens, it would be an irreparable disaster. It will be a final blow to the country. This is not an assumption, it is an absolute fact. Printing money will ruin the country’s economy and the nation.

Business News:  [BCT Governor] Chedly Ayari has suggested printing money with calculated risks...

Houcine Dimassi:  That is his opinion. But I personally think that it would be a blow to the country. Printing money can only lead to inflation. It is a process: inflation, currency depreciation, rising import prices, combined internal and external inflation, which becomes irreparable.

Business News:  One reason why you resigned was the dismissal of the BCT governor. But [Tunisian President] Moncef Marzouki had announced that dismissal a long time ago. Why have you not publicly reacted to save the BCT governor as [Economy Minister] Ridha Saidi has done?

Houcine Dimassi:  My answer is the same as before. As long as I am in the government I will not criticize it.

Business News:  But Hamadi Jebali, Ridha Saidi, and many others have criticized the president’s remarks on the sacking.

Houcine Dimassi:  That is their business.

Business News:  You could have discussed it with the president.

Houcine Dimassi:  How? By knocking on his door? Moncef Marzouki has never consulted me with regard to the IMF-related bills that he refused to sign nor with regard to the BCT, nor anything else.

Business News:  Have you discussed these problems with the head of the government?

Houcine Dimassi:  Hamadi Jebali had always listened to me and understood me. But he also had his constraints, such as pressure from his party ... We have taken cabinet decisions that have never been implemented. Some decisions have been written into the supplementary budget law and the compensation law.

Business News:  Assuming that it will win the next election, the government is endangering its own five-year term by behaving this way. What will it do tomorrow?

Houcine Dimassi:  Yes, absolutely. It is endangering its own five-year term. I would also like to give some friendly advice to my colleagues in the government and especially to my Ennahda friends. When you think about elections, you must also think beyond them. Meaning, with which society you are going to govern. It is not enough to win the elections. You must also have a society that can be governed afterward. A government is supposed to govern and not react to street talk. It must reconcile [differences] without being dysfunctional.

Business News:  How do you see the future?

Houcine Dimassi:  We are going to face our worst crisis since independence. We have already had two serious crises. One was in the late 1960s with the cooperatives issue and one in the mid-1980s, after 1986. The third one is today. And it could turn out to be worse than the previous ones. For the first two crises, the international situation was good and we were able to get out [of these crises] whose impacts were absorbed. But now, there is a confluence of international and domestic conditions.

Business News:  Specifically, what can the opposition do to save what can still be saved?

Houcine Dimassi:  It must unite and form a united front. It must take clear positions on these important issues because the opposition can play the same electoral game and commit the same transgressions as the current government.

Business News  And you?

Houcine Dimassi  I intend to remain independent and serve my country in my own way through research, advocacy, and raising awareness on the real issues and challenges facing our country, no matter what they are. I have had experience with these issues before becoming minister and I can do information-, communication-, or consulting-related work with organizations that matter, including the UGTT, but only as a consultant, not as an active employee, and not necessarily as a consultant for the opposition. I can do this work even with this government if it trusts me. My only concern remains the interest of the country.

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