Tunis – The Management Board of the Central Bank of Tunisia has reported that the country’s economy slowed down in Q2 this year, during which the Gross Domestic Product (GDP) grew by 2%, as against 2.8% in the same period last year. In H1, Tunisia’s GDP was up 2.1%.
In a press release issued this Tuesday (2nd), the Central Bank of Tunisia (BCT) said the slowdown was caused by continued deceleration of activity in non-manufacturing industries and slower growth in other areas, such as the processing industry and services.
Non-manufacturing activity was down 5.8% in Q2, and down 1.4% in Q2 last year. Processing industry activity was up only 0.1% in Q2 2014, and up 4.1% in Q2 2013. Services sector activity was up in Q2 this year 3.8% and up 4% in Q2 last year.
The sole exception was agriculture and fisheries, up 1% in Q2 this year, and down 4% in Q2 2013.
The CBT board also reported that Tunisia’s current account deficit widened by 29.3% year-to-date through July and reached 6% of GDP, as against 5% in the same period of 2013. The higher deficit stemmed from the fact that the trade deficit widened by 18.2%.
Other contributing factors were an 11% decline in crude oil exports, a 66.9% increase in natural gas imports and a 68.8% increase in the food trade deficit, which came in spite of a 5.7% decline in food imports.
The country’s foreign exchange reserves, however, were not badly hit and remain at acceptable levels, equivalent to 113 days’ worth of imports. In Q2 2013, reserves were enough to cover 104 days of imports.
In turn, international tourism revenues were up 40.1% in the first 20 days of August, according to the CBT.
In August, the Tunisian dinar was up 0.4% against the euro and the exchange rate was 2.2941 dinars for 1 euro by the end of the month. Against the US dollar, however, the Tunisian currency was down 1.1% and closed the month at 1.7383 dinar for US$ 1. Year-to-date, the dinar was down 1.2% against the euro and down 5.3% against the US dollar.
On the domestic front, the inflation rate went from 5% in June to 6% in July, year-on-year, as prices went up for both government-controlled and freely traded items.
*Translated by Gabriel Pomerancblum
