Tunisia to sell stakes in banks as faces budget pressures

A view of Tunisian Central Bank in Tunis, Wednesday Feb. 16, 2011. (File Photo: AP)

Tunisia plans to sell 10 to 15 percent stakes in several state-run banks to raise around 1.3 billion Tunisian dinars ($670 million), its finance minister said on Tuesday as the country faces pressure to cut its fiscal deficit.

The North African state also expects to receive $1 billion in loans from the World Bank and the International Monetary Fund this year, Minister Slim Chaker told a finance conference in Kuwait.

It faces pressure from creditors to cut high public spending, including subsidies on basic foods and fuel, through a series of politically sensitive reforms.

The budget deficit is expected to narrow from 5.8 percent in 2014 to 5 percent in 2015, but that target has been made tougher by salary hikes for tens of thousands of public school teachers who went on strike last month and boycotted student exams to press wage demands.

Tunisia has been praised as an example of compromise politics and democratic transition since overthrowing autocrat leader Zine al-Abidine Ben Ali in a 2011 uprising, holding free elections and drafting a new constitution.

Before the teacher wage increases, however, it had already cancelled a tax imposed on travelers crossing Libya's border after the measure triggered rioting, highlighting the problems the government faces to bolster shaky state accounts.

Public wages account for about a third of the state budget and Tunisia's powerful UGTT labor union started negotiations with the government last month to increase salaries for some 800,000 workers.

($1 = 1.9442 Tunisian dinars)

SHOW MORE
Last Update: Wednesday, 20 May 2020 KSA 09:44 - GMT 06:44
Top