Tunisia continues to grapple with a persistent public finance crisis, despite a projected modest reduction in its budget deficit for 2025.
The government expects the deficit to shrink to 5.5% of GDP this year, down from 6.3% in 2024, thanks to targeted tax increases on corporations and high-income earners. Nevertheless, public debt is expected to remain high, reaching around 80.5% of GDP by the end of 2025, compared to 82.2% in 2024.
The draft 2025 budget anticipates a deficit of approximately 9.8 billion dinars, with projected spending of 59.8 billion and revenues limited to 50 billion dinars. The fiscal policy aims to ease the burden on low-income households while raising taxes on wealthier individuals and companies generating over 20 million dinars in annual turnover, which will now be taxed at 25%.
Financing needs remain significant.
With high public spending and fragile monetary stability—due in part to increased reliance on the central bank—local banks are being heavily tapped, limiting their ability to support the private sector.
While official forecasts project 3.2% growth in 2025, the World Bank offers a more cautious outlook of 1.9%, citing weak economic improvement.
Negotiations with the IMF have been stalled since October 2023, depriving Tunisia of critical financial support. The country’s sovereign credit rating (“Caa1”, stable outlook) also continues to hinder access to alternative funding sources.
In short, while Tunisia’s fiscal trajectory shows slight signs of improvement, lasting financial stability remains elusive without structural reforms, renewed access to international financing, and a restoration of investor confidence.
MK/te/lb/as/APA