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US senator urges Europe to be firm on Tunisia IMF deal

April 12, 2023 at 9:49 am

The International Monetary Fund (IMF) building is seen in Washington D.C., United States on December 26, 2022 [Celal Güneş/Anadolu Agency]

A prominent US senator yesterday called on America’s European allies to stand firm on democracy in Tunisia before approving a bailout deal for the country with the International Monetary Fund (IMF), accusing President Kais Saied of harming the democratic process by tightening his grip on power.

Democratic Senator Chris Murphy, head of the Senate subcommittee on relations with the Middle East, also criticised President Joe Biden for continuing to provide aid to the Tunisian armed forces.

Tunisia reached an agreement in principle with the IMF in October on a rescue package of about $2 billion to support its ailing economy, but the plan is still awaiting approval by the IMF Board of Governors, which is pressing for reforms.

Saied pledged last week to reject the “diktats” of the IMF, at a time when Italy is leading efforts to reach a quick agreement, fearing the influx of more migrants to its shores in the event that the economic conditions in Tunisia witness a further decline.

“I think we’ve got a little bit of work to do to convince all of our European friends that this is the time to drive the harder bargain,” Murphy said at the US Institute of Peace.

He believes that European countries are likely to seek “short-term stability” but called for a longer-term view.

“Yes, the IMF could step in here with a deal with few conditions that would patch things up for months, maybe years,” he said, adding, “But you’d be back in a crisis – once again you’d be necessitating another bailout, that would be even less palatable to international financial institutions – a few years from now.”

READ: ‘Tunisia is not for sale,’ rejects IMF loan provisions

Saied has tightened his grip on power since the dismissal of the government in July 2021, the subsequent dissolution of parliament, and the adoption of a new constitution to replace the one approved in 2014.

Murphy also expressed his opposition to Biden’s budget proposal that would keep funding levels for the Tunisian military the same, which the senator said has “largely stood by, acquiesced and sometimes facilitated Saied’s transition away from democracy.”

“The Biden administration has, I think, made a bet on the Tunisian military,” Murphy said, “I would argue that we should make a bet on civil society instead.”