Tunisia’s GDP is projected to grow by 2.7 per cent in 2021 and 2.9 per cent in 2022, says the European Bank for Reconstruction and Development (EBRD).

The bank points out in its Regional Economic Prospects 2021 report published on Tuesday, that some recovery is expected for Tunisia supported by the impact of improved weather conditions on agriculture, notably olive oil production.

Meanwhile, the recovery will depend on the pace of vaccination allowing the reopening of the economy, including for the tourism sector.

The EBRD pointed to a 8.8 per cent contraction in Tunisia’s economy in 2020, adding that the economic downturn continued in the first quarter of 2021 as GDP contracted by 3 per cent year-on-year.

However, the reforms needed for a strong and sustainable recovery are being held back by the lack of political consensus and limited ambition in overhauling public administration and state-owned enterprises.

IMF-supported structural reforms may be delayed further, and the economic impact is likely to be slow as fiscal tightening is expected to hold back a stronger recovery. Other downside risks include lingering effects of the pandemic and the slow recovery in tourism worldwide.

Output in the southern and eastern Mediterranean (SEMED) is expected to grow by 3.5 per cent in 2021, the bank indicates, adding that growth is expected to increase to 4.6 per cent in 2022, supported by structural reforms and recovering foreign direct investment and trade flows.

The World Bank (WB) revealed in its latest edition of the World Economic Outlook published at the beginning of June, that economic growth is expected to rebound to 4% in 2021 in Tunisia after a historic decline of 8% in 2020.

The WB also forecasts a slowdown in Tunisian growth to 2.6% in 2022 and 2.2% in 2023.

Source: TAP News Agency