Japan has agreed “in principle” to lend Tunisia $100mn to help tackle the impact of the Covid-19 pandemic, Tunisian state news agency TAP said on 27 August. This comes after the London-based European Bank for Reconstruction and Development announced on 24 August a €150.5mn “sovereign guaranteed loan” for the state owned ‘Office des Cereales’ to help fund imports of soft wheat, durum wheat and barley.
The pledges come as Tunisia continues to battle large fiscal deficits and widening external imbalances due to rising commodity prices (MEES, 22 July). The country is also seeking around $4bn from the IMF which could also unlock other sources of multilateral funding. But the powerful UGTT union remains a key obstacle to reforms meant to tackle a bloated public-sector wage bill, sky-high subsidy spending and debt-ridden state-owned enterprises. (CONTINUED - 130 WORDS)