Growth in Tunisia projected to decelerate further to 2.0% in 2023, before slightly picking up to 2.3% in 2024 (EBRD)

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Growth in Tunisia is projected to decelerate further to 2.0 per cent in 2023, before slightly picking up to 2.3 per cent in 2024, according to the European Bank for Reconstruction and Development (EBRD) latest Regional Economic Prospects (REP) report, published on Tuesday.

The political instability, economic slowdown in Europe, limited fiscal space, lack of access to external financing, restrictive business environment and delays in the implementation of reforms are all expected to continue to weigh on the economy, the same source considers.

The economy also remains vulnerable to external shocks, given its relative dependence on tourism, imported food and energy and Europe as a market for its exports. Meanwhile, a final agreement on an IMF-supported programme, if reached, could unlock the necessary external financing and accelerate reforms including removing fuel subsidies, reducing the public wage bill, narrowing the fiscal deficit and improving the business environment, the report underlines.

The European Bank for Reconstruction and Development (EBRD) is forecasting modest economic growth in 2023 in the southern and eastern Mediterranean (SEMED) region.

The Bank expects a slight pick-up in gross domestic product (GDP) growth to 3.6 per cent in 2023 from 3.1 per cent in 2022 as economies across the SEMED region adapt to the impact of the war on Ukraine, the agricultural sector rebounds and reforms progress. However, the challenging global inflation outlook and political uncertainty remain downside risks.

The recovery is expected to gather pace in 2024, with average GDP growth of more than 4 per cent, as reforms advance in all of the region's economies.

Source: Agence Tunis Afrique Presse

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