São Paulo – The most recent study elaborated by the World Bank on the Tunisian economy states that the Gross Domestic Product (GDP) should register growth by 2.6% in 2013 (year’s final data not in yet), 3% in 2014 and 4.1% in 2015, which is below the country’s potential. In the document, Economic Monitoring Note on Tunisia, the World Bank states that the country needs to face reforms, redirect public spending and promote competitiveness in the private sector.
According to the report, which was released on Thursday (16) by the World Bank, Tunisia’s fiscal deficit increased in 2011 and 2012, and is expected to reach close to 7% of the GDP in 2013. For 2014, forecasts are not looking up: fiscal deficit shall be lower than in 2013, but is expected to be over 6%.
The World Bank emphasizes that, due to the bad economic results, there is more pressure for austerity measures, which is still not enough for the country to grow properly. “Even if this is necessary, fiscal discipline alone does not stimulate economic growth or job creation, and may even act as a brake in the short term,” reads the institution’s statement.
The World Bank states that Tunisia needs to raise employment rates, expand economic growth and make “structural” reforms to encourage the private sector. “Faster growth will only be possible by developing an inclusive and competitive private sector – which requires faster and deeper reforms already underway, while redirecting public expenditures with the fiscal space still available,” says the report.
