Tunisia will restrict the import of some goods to tackle its widening trade deficit and protect foreign reserves as the local dinar currency slides to historic lows against the euro and dollar, Prime Minister Youssef Chahed said on Friday.
Praised for its successful democratic transition after a 2011 uprising, Tunisia has struggled to progress with tough economic reforms to reduce public spending as demanded by the International Monetary Fund (IMF) and its international partners.
“The fall of the dinar reflects this enormous trade deficit but there is no need to panic. We will take some decisions. We will limit some random imports. We have a lot of unnecessary imports,” he told reporters at an event in Sfax city.
The dinar traded at 2.64 against the euro and 2.46 against the dollar on Friday for the first time, traders told Reuters.
Chahed said a Cabinet meeting next week would decide on the details of the restrictions. Tunisia’s trade deficit expanded by 57 percent to reach $1.68 billion in the first quarter of this year because of a jump in imports.
“We will reduce imports of many luxury goods,” a government official told Reuters.
The local currency has continued its sharp decline since Finance Minister Lamia Zribi said last Tuesday the Central Bank would reduce interventions so that the value of the dinar gradually declines, though she said it would prevent a dramatic slide.
The IMF agreed this week to release a delayed $320 million tranche of Tunisia’s $2.8 billion in loans. It called for a tighter monetary policy that would counteract inflationary pressures, and said: “Greater exchange rate flexibility would help narrow the large trade deficit.”
The UTICA industry and business employers’ association, one of the country’s major economic lobbying groups, urged the government to tackle the dinar’s drop. It warned that the sharp decline of currency would increase economic pressures and hit companies that import raw materials from abroad.
Source: Arab News
GMT 12:49 2018 Tuesday ,16 January
Tabarak Buys Majority Stake in a Private CompanyGMT 16:01 2017 Tuesday ,19 December
BCCI board elections date setGMT 08:05 2017 Sunday ,17 December
Malaysian Premier praises EDBGMT 09:58 2017 Saturday ,16 December
Saudi Arabia launches new SR30bn export bankGMT 08:30 2017 Saturday ,09 December
World Bank signs $1.15 billion loan with EgyptGMT 11:50 2017 Friday ,08 December
Reopening of SABIC office in Iraq to benefit both sides: ExpertsGMT 17:18 2017 Thursday ,07 December
EDB highlights Bahrain investment advantagesGMT 14:44 2017 Tuesday ,05 December
Saudi oil minister reaffirms OPEC output squeezeMaintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2023 ©
Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2023 ©