IMF Urges Tunisia to Make Reforms despite Troubles Following Terror Attacks

In March and June, Islamic extremists attacked popular tourist destinations in Tunisia, crippling its once vital tourism industry. Yahoo! News reports that despite this enormous economic setback, the International Monetary Fund (IMF) has urged Tunisia to move forward with an enormous list of pending economic reforms the IMF believes may help right the North African nation’s sinking economy.

In March and June, Islamic extremists attacked popular tourist destinations in Tunisia, crippling its once vital tourism industry. Yahoo! News reports that despite this enormous economic setback, the International Monetary Fund (IMF) has urged Tunisia to move forward with an enormous list of pending economic reforms the IMF believes may help right the North African nation’s sinking economy.

According to IMF chief Christine Lagarde, despite the difficult international economic conditions in the second half of 2015 and the negative effects of the militant Islamist attacks on the national museum and a popular tourist resort, Tunisia is “proving its resilience.” Lagarde’s comments came after a meeting with Tunisian President Beji Caid Essebsi and Prime Minister Habib Essid.

Lagarde noted that the IMF and Tunisia agreed on the need to move forward with economic reforms as quickly as possible, and that they both agreed that maintaining security would be paramount in the efficacy of those reforms.

According to Lagarde: “To maintain growth, create the conditions of prosperity and, above all, create employment, it is imperative to maintain security, macroeconomic and financial stability so that confidence can be restored.”

According to the IMF, to reach these goals, Tunisia needs a solid, stable banking system, more effective public administration, a fair tax system, and a more open and competitive business climate. The IMF has also suggested a number of modernizing policy adjustments designed to further improve transparency, open investing opportunities, and more modern social and financial protection programs.

Tunisia experienced a popular uprising in 2011 that ousted a longtime dictator. Since the turnover of power, the nation has struggled to achieve significant economic improvement. Gross domestic product (GDP) growth was a mediocre 1 percent in the first half of 2015, but the full year projection is an even more dismal 0.5 percent according to the Tunisian Finance Ministry. Tunisia’s economic growth initiatives were further set back following an attack on the national museum in March, followed by the assault on a beach resort in June that killed a total of 59 tourists.

In 2013, the IMF provided a $1.7 billion (USD) credit line to Tunisia that was originally set to expire in June. However, following the attacks and the nation’s slow growth, the IMF agreed to extend that line of credit for another seven months in order to give the nation more time to adopt the proposed reforms and keep afloat until they can take effect.