Tunisia tourism could lose $1.4bn, as government eyes bond sale

Clothing factory CEO Khouloud Guesmi, right, checks a face mask at her production line outside Tunis after she repurposed her fashion business. Tunisia is in lockdown until at least Sunday. (AP)
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Updated 15 April 2020

Tunisia tourism could lose $1.4bn, as government eyes bond sale

  • Country seeks loan guarantee from bilateral partners to counter the effects of the coronavirus

TUNIS: Tunisia’s vital tourism sector could lose $1.4 billion and 400,000 jobs this year due to the coronavirus pandemic, an official document showed, as the country seeks a loan guarantee from bilateral partners to issue sovereign bonds this year.

In a letter sent to the International Monetary Fund (IMF) that was reviewed by Reuters, Tunisia’s central bank governor and finance minister said the country’s economy would shrink by up to 4.3 percent, the steepest drop since independence in 1956.

The IMF, which approved on Friday a $745 million loan to Tunisia to counter the effects of the coronavirus, said that a new funding program with Tunisia could start in the second half of this year. The size of the new program remains unknown.

The North African country has confirmed 747 cases of the virus and 34 deaths, and last month imposed a lockdown set to last until at least April 19. The outbreak is hammering its tourism sector, which represents nearly 10 percent of gross domestic product (GDP) and is a key source of foreign currency.

“We are working with partner governments on a potential guarantee for future sovereign bond issuances in the currently difficult international context,” the central bank governor and finance minister wrote in their letter.

The IMF said that the fiscal deficit in Tunisia would rise to 4.3 percent of GDP this year, compared with the 2.8 percent originally expected, due to the need for extraordinary expenditures over this crisis.

FASTFACT

4.3%

The IMF said that the fiscal deficit in Tunisia would rise to 4.3 percent of GDP this year, compared with the 2.8 percent originally expected.

As part of its 2020 budget, Tunisia plans to issue bonds worth up to €800 million ($877 million), but officials have not given any details or date for the issue.

The IMF said also in a report that Tunisia was seeking a loan guarantee from a G7 country.

The fund added that if such a guarantee were not forthcoming, Tunisia would need to seek alternative financing that could involve a syndicated loan from international banks.

In the letter, Tunisia pledged to contain its public wage bill, reform public companies and reduce subsidies for electricity and natural gas.

Prime Minister Elyes Fakhfakh said this month that the government has allocated about $1 billion to tackle the economic and social effects of the crisis. 


Saudi regulator refers investors to Public Prosecution over $346m in suspicious trading

Updated 30 November 2020

Saudi regulator refers investors to Public Prosecution over $346m in suspicious trading

  • The investors were suspected of violating Article (49) of the Capital Market Law

The Capital Market Authority (CMA), announced today, Nov. 30, referring 22 investors to the Public Prosecution over suspicious trading in shares of Dar Al Arkan Real Estate Development Co., and making illicit gains of SAR 1.33 billion ($346.7 million).

The investors were suspected of violating Article (49) of the Capital Market Law and Article (2) of the Market Conduct Regulations, the market regulator said in a statement.

The claim was referred to the Committee for Resolution of Securities Disputes.

This came in line with the CMA’s efforts to protect the market from unfair as well as illegal practices, including deceit, cheating, fraud and manipulation, and to ensure market efficiency and transparency.

Last week, the CMA identified some cases suspected of manipulations, fraud and scam of the capital market rules and its executive regulations, amid the price fluctuations of some stocks, Argaam reported.

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