Tunisia to attend G8 summit seeking massive international aid. Libyan civil war causes severe hardship to Tunsian economy: TAP

G8: For massive support to transition in Tunisia

Wednesday, May 25, 2011 19:14

TUNIS  (TAP) – Tunisia is taking part for the first time, alongside Egypt, in the G8 Summit scheduled for May 26-27 in Deauville, France.

This summit, which brings together the eight most industrialised countries, will focus on prevention of nuclear danger and economic and financial support to the “Arab Spring”  which was sparked by Tunisia.

Decisions of the summit on the amount and nature of aid to be granted to the region is a major challenge for the transition process started in Tunisia and Egypt.

Prime Minister in the Interim Government Béji Caid Essebsi said, during his visit to Paris on May 17-18, that the economic plan presented by Tunisia to the G8 requires a contribution of 25 billion dollars (nearly 34.5 billion dinars) over five years, i.e., 5 billion dollars annually (6.9 billion dinars).

The amount of 5 billion dollars equals, according to economist Mahmoud Ben Romdhane, half of the external funding the country needs each year.

Tunisia needs a massive economic and financial support from the international community, said this former chairman of Amnesty International.

The country, he told TAP, is facing real economic and social hardships inherent to the transition process but which have worsened as a result of a particularly difficult regional and international context.

The trouble has to do with civil war in neighbouring Libya, its direct and indirect consequences on Tunisia, especially the impact of interruption of Libyan tourist flows, deterioration of trade exchanges with that country and return from Libya of thousands of Tunisian workers. The latter have now become applicants for subsidies, he said.

Moreover, Tunisia’s closeness to that country does not reassure European tourists, who are major customers of Tunisia, Mr. Ben Romdhane stressed. Consequently, the need to caution the international community against “the serious risks of failure” that threaten the Revolution as a result of pressure of social demands and the reduced capacity of the Tunisian economy to meet them.

It is important, he said, that the European and American officials be aware of the risks the country is running. He went so far as to point out that “success of transition in Tunisia is a condition for peace in the region and the world.”

He voiced hope that, through participation in the G8, this issue will receive the needed attention and adequate response. It is urgent, he said, that the announcement of assistance be made prior to the holding of elections to restore hope among the Tunisian people and show them that openness pays off.

Mr. Azzam Mahjoub, international economic expert, notes in a statement to TAP agency the lack information available on the economic plan submitted to the G8 by the Interim Government.

He said the solidarity and sympathy drive expressed by the international community to Tunisia and its Revolution should materialise in “consistent assistance, essentially, donations more than credits, given the ‘financial stress’ experienced by the country at this stage.”

This assistance, the economist reckons, could serve to make up for the deficits of the State budget and the payment balance which, in the coming months, might further worsen.

In the G8 summit, according to Mr. Mahjoub, Tunisia could also ask for the conversion of part of its debts into development projects, notably those as part of bilateral relations with the institutions and the European Union countries. He notes that “service of the country’s debt averages 2 billion dinars annually.”

Mr. Mahjoub also advocates an approach of strong added-value foreign direct investments, pointing out that the country particularly needs it in order to absorb higher graduates’ unemployment.

However, for this economist, whatever economic plan Tunisia is to present, the G8 countries will “wait and see.” They will firmly commit themselves to support Tunisia only after the elections.

In turn, Mr. François Hollande, former French Socialist Party first secretary and candidate to his party’s primaries for the French presidential election, proposed last Tuesday during a visit in Tunisia conversion of the debt into donation by the international community.

France and Europe, Mr. Hollande specified, will support during the G8 summit in Deauville the transition process in Tunisia economically and financially, adding that this arrangement could be extended over a five-year period, through infrastructure projects, energy independence, training and re-qualification of higher education graduates.

A few days earlier, 21 economists representing their prestigious western universities called on the G8 to adopt an economic plan to support Tunisia with the appropriation of 20 to 30 billion dollars (between 27.6 and 41.4 billion dinars) over a 5-to-10-year period.

These economists called for a European commitment to grant Tunisia the status of an EU associated partner with full access to the European structural funds, especially claiming an immediate assistance for food and energy subsidisation, as well as a further-training plan for the benefit of jobless graduates.

The American president had already announced, last Thursday in Washington, that about 2 billion dollars (2.76 billion dinars) will be dedicated to the success of the democratic transition in Tunisia and Egypt.

For its part, the World Bank had announced, on Wednesday, that one billion dollars (1.38 billion dinars) would be made available to Tunisia under the shape of budget and investment projects support.

However, these amounts are, for the moment, intention statements. This could not be otherwise, the Tunisian economists explain, as long as power in the country has not been elected democratically.

About rawlinsview

News and political commentary from the point of view of the social interests of the international working class.
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