The uncertainties and fears over the collapse of this country has pushed Fitch agency to downgrade its Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘CCC-‘ from ‘CCC+’. The country was unable to implement prior actions for an agreed IMF program, which would be necessary to release the associated bilateral financing that underpinned Tunisia’s financing plan. Tunisia’s financing plan relies on more than $5 billion of external financing (10% of GDP). The reforms and IMF negotiations are stalled, said Fitch. Furthermore, foreign exchange reserves in Tunisia are at Risk as external financing sources are highly dependent on government external borrowing, while the stalled progress on reforms continues to preventing the reduction of budget vulnerabilities to shocks.

Source: The North Africa Journal June 11, 2023 20:59 UTC