New constitution, new loan: Tunisia receives $1.2 billion loan from World Bank
Tunisia has secured $1.2bn in loans from the World Bank to support its democratic transition in 2014, the global lender said on Friday.
It is the biggest loan package Tunisia has received since the 2011 revolution that toppled autocratic president Zine El-Abidine Ben Ali. The International Monetary Fund approved a $507m loan tranche on 29 January.
The North African country’s economy relies heavily on European tourism and is still recovering from the aftermath of its political upheaval three years ago.
A caretaker government has taken over to run the country until elections later this year. But despite political progress, high living costs and a lack of economic opportunities remain the major concerns for many Tunisians.
Political sources told Reuters that Prime Minister Mehdi Jomaa was preparing to announce tough reforms on subsidies and taxes as the cash-strapped government seeks to cut spending.
The World Bank package includes $750m to support the economy by promoting growth and job creation while $300m will underpin moves towards decentralisation stipulated by the new constitution.