Tunisia Says Has No Intention of Requesting Foreign Debt Rescheduling

Tunisia Says Has No Intention of Requesting Foreign Debt Rescheduling

Tunisia’s financial situation is critical, but the government has no intention of requesting a rescheduling of its foreign debt, Finance Minister Ali Kooli said in Wednesday.

Tunisia, which has seen its debt burden rise and economy shrink by 8.8%, with the fiscal deficit at 11.4%, started talks with the International Monetary Fund to seek a package of financial assistance.

Kooli told local Mosaique FM radio that negotiations were also under way with other potential lenders, including Qatar, to help finance the state budget.

A sovereign default in Tunisia - though highly unlikely in the next 12 months - could cost the country’s banks up to $7.9 billion, S&P Global Ratings said last week.

Tunisia’s 2021 budget forecasts borrowing needs at $7.2 billion, including about $5 billion in foreign loans. It puts debt repayments due this year at $5.8 billion including $1 billion in July and August.