Tunisia secures more loans as protests hit deprived town

Wed Nov 28, 2012 3:51pm EST
 

By Francesco Guarascio and Tarek Amara

TUNIS (Reuters) - Tunisia, struggling to ease economic difficulties that have provoked unrest since its democratic revolution, said on Wednesday it had secured more international lending to cover its 2013 spending.

Tunisia's new, elected Islamist-led government has sought to revive the economy in the face of a decline in trade with the crisis-hit euro zone and disputes between secularists and hardline Salafi Islamists over the future direction of the North African Arab state.

At least 200 people were injured when Tunisians demanding jobs clashed with police on Tuesday and Wednesday in the city of Siliana in a region on the edge of the Sahara desert that has long complained of economic deprivation.

The state news agency TAP said Tunis had clinched a $500 million loan from the African Development Bank, after the World Bank approved a $500 million loan on Tuesday, and a government minister told Reuters finances were now in order for 2013.

"Next year our public expenditure is essentially covered, thanks also to lines of credit for a total of $1 billion from the World Bank and the African Development Bank," Investment Minister Riad Bettaieb said on the sidelines of a meeting with a European Union business delegation.

"So we are not planning to ask for further international support from the International Monetary Fund (IMF)," he said.

But he said Tunisia could ask the IMF for a standby credit line worth $2.5 billion for 2014 and beyond. "We are considering asking the IMF for a precautionary line of credit to give a guarantee for our financing needs ... around $2.5 billion."

The loans, the World Bank's second since the "Arab Spring" uprising that toppled autocrat Zain al-Abidine Ben Ali in January 2011, aim to support economic recovery by improving the business and financial sectors and reforming social services.   Continued...

 
A protester burns tyres during clashes with police in Siliana November 28, 2012. At least 200 people were injured as Tunisians demanding jobs and economic development clashed with police on Wednesday, medical sources said, in the latest unrest to hit the country that spawned the Arab Spring uprisings. REUTERS/Mohamed Amine ben Aziza