(Ecofin Agency) - After an estimated record decline of -8.8% last year, the Tunisian economy seems to be getting back on track. The Organization for Economic Cooperation and Development (OECD) revealed in a May 31 report that the country’s economic growth is expected at 3% this year and 3.25% in 2022.
The new impetus will be favored, the document says, by the easing of Covid-19 related measures both in Tunisia and across the world. That means trade relations (exports included) with partners will resume. Also, the ongoing monetary policy and the inflationary trend are expected to foster reforms in various sectors.
The institution however warns that the return to positivity would be gradual and slow. OECD said GDP growth depends mainly on the effective rollout of vaccines, but also on factors such as the return of investors and the easing of political tensions. Thus, "the slow pace of vaccine rollout and the need to maintain travel restrictions in the second half of 2021 will disrupt activity in labor-intensive service sectors.”
“The increase in business failures as the subsidies are withdrawn will keep unemployment high, thereby weighing on household income and dampening private consumption," the report reads.
According to OECD, a deep reform in the budget management method, the creation of an environment conducive to entrepreneurship and trade as well as the installation of better port infrastructure will help Tunisia in its economic recovery journey.
Carine Sossoukpè (intern)