By Tristan Dreisbach | Apr 17 2013central bank , Development , Economy , imf , loan ,
Negotiations on the terms of an International Monetary Fund (IMF) stand-by loan arrangement are ongoing, and a finalized agreement is expected in May, according to the Tunisian Central Bank and the Ministry of Finance.
The arrangement will be for $1.75 billion (2.7 billion Tunisian dinars) and will be offered at a 1.08 percent interest rate, according to a source at the Central Bank. Tunisia would have five years to pay back the funds, including a three-year grace period.
The loan will be signed after being approved by a the IMF Board of Directors in May, according to a Ministry of Finance statement.
The deal is not a straight-forward loan, but rather a pool of money provided by the IMF that Tunisia could access in case of an economic emergency. The money could not obtained in one lump sum, said the Central Bank source, but would rather be accessed in installments as needed.
Critics of the deal have asserted that the IMF would impose economic reforms on Tunisia, but the source said that this is not the case. He said the Tunisian government has given the IMF information on its reforms, but that the IMF has not asked Tunisia to undertake specific reforms.
The government has asserted that it does not anticipate using the stand-by funds.
The source stated that the Central Bank has nothing to do with the case, although it has been represented at the negotiations, and said that the Ministry of Finance is the key actor. He added that the status of negotiations is “very advanced.”
This contradicted Hafedh Bougueraa of the Ministry of Finance, who told Tunisia Live that “the whole affair is in the hands of the Central Bank.” He said the Central Bank asked for the IMF arrangement.
Bourgueraa stated that there is still not a clear vision of the arrangement, and that the IMF wants to have a detailed understanding of the situation in Tunisia and to know how the funds would be used.
Minister of Finance Elyes Fakhfakh left yesterday for Washington DC, where he will meet with IMF and World Bank officials.
Amira Marsour contributed reporting