Thursday , December 14 2017

Kuwait to give Tunisia $500mn in loans – Financing spread over five years

Tunisian President Beji Caid Essebsi (left), delivers his speech during the opening ceremony of ‘Tunisia 2020’, an international investment conference, in Tunis, Tunisia on Nov 29. International investors  are converging on Tunisia as the government tries to drum up billions of dollars to keep its young democracy from falling into economic collapse. (AP)
Tunisian President Beji Caid Essebsi (left), delivers his speech during the opening ceremony of ‘Tunisia 2020’, an international investment conference, in Tunis, Tunisia on Nov 29. International investors are converging on Tunisia as the government tries to drum up billions of dollars to keep its young democracy from falling into economic collapse. (AP)

TUNIS, Nov 29, (Agencies): Kuwait will provide Tunisia with $500 million in loans over the next five years, Kuwait’s finance minister told delegates at a Tunis investment conference on Tuesday.

Western and regional partners have been offering Tunisia financial backing as the conference gets under way, including a pledge of $1.25 billion in aid from Qatar.

Nearly six years after its Arab Spring revolution, Tunisia hopes the meeting will help it confront challenges including high unemployment, low growth and a tourism sector hammered by jihadist attacks.

The two-day “Tunisia 2020” conference aims to put the North African nation “back on the investment map of the Mediterranean”, officials said.

“Tunisia faces exceptional circumstances and needs exceptional support,” said President Beji Caid Essebsi.

“The success of the democratic project in Tunisia … serves the interests of the region and can help strengthen security and stability regionally and globally,” he said.

At the conference’s opening session Qatari Amir Sheikh Tamim bin Hamad Al-Thani pledged $1.25 billion (1.18 billion euros) in financial support.

He said the money would “support the Tunisian economy and strengthen its process of development,” without giving further details.

“In Tunisia we face a people who decided to build their country based on plurality, dignity and human freedom,” Sheikh Tamim said.

“Will we help them so that the experience succeeds, or will we watch them face the difficulties alone?”

French Prime Minister Manuel Valls said the French Development Agency (AFD) would invest “at least 250 million euros ($265 million) every year” in Tunisia, a former French colony.

That is on top of an aid package France announced last year to pump a billion euros ($1.06 billion) into the Tunisian economy by 2020.

“We want to go further,” Valls said, adding that France has “duty and a responsibility” to support Tunisia and called on Europe to “live up to expectations”.

Despite avoiding the violence that has rocked other countries in the region since the Arab Spring revolutions, Tunisia has struggled to relaunch its economy.

Prime Minister Youssef Chahed’s government took office in August in place of an administration heavily criticised for its economic management.

That followed a catastrophic 2015 in which attacks claimed by the Islamic State group killed 59 foreign visitors and 13 Tunisians. The attacks dealt a devastating blow to the tourism industry, which in 2010 employed 400,000 people and represented 10 percent of Gross Domestic Product.

Strikes and social unrest have also hit strategic sectors including phosphate mining. Around 15 percent of the workforce was unemployed as of the spring of 2016, according to the World Bank. Many are young graduates, who have seen the hope of the Arab Spring dissipate.

In January, Tunisia faced its biggest social unrest since the revolution.

The government hopes the conference, attended by more than 2,000 business, finance and political leaders from 40 countries, will attract billions of dollars of much-needed investment.

Officials say the conference is part of a charm offensive aimed at the private sector.

It is seeking bids on 140 ventures — from infrastructure and agricultural projects to hi-tech schemes — worth roughly $32 billion (30 billion euros).

The International Monetary Fund approved a $2.9 billion loan to Tunisia in May to help the country implement economic and financial reforms.

The European Union also announced a doubling of its financial support in 2017 to $318 million (300 million euros).

Essebsi will head to Brussels on Wednesday and Thursday for an EU-Tunisia summit.

Chahed told AFP last week that Tunisia deserved support and that the international community “should invest in Tunisian democracy”.

Incoming UN Secretary General Antonio Guterres told Tuesday’s conference that Tunisia had not yet received enough economic support.

“The success of Tunisia requires a strong economy,” he said. “For the private sector, investing in Tunisia is an intelligent decision.”

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