Summary:

From 22-23 June 2023, Tunisian President Kais Saied was in Paris at the invitation of French President Emmanuel Macron participating in the Paris Summit for a New Global Financing Pact. The Summit, led by Macron, sought to identify investment solutions for poorer countries that address climate change.

The Paris Summit was attended by a number of global leaders, including Saudi Prince Mohammed bin Salman and International Monetary Fund (IMF) Managing Director Kristalina Georgieva. However, some commentators noted the lack of senior most leaders from the broader G7 community beyond French President Macron and German Chancellor Olaf Scholz.

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Views of the Summit varied, with some citing success stories related to the pausing of debt repayments for some countries, and agreements among richer countries to fund climate relief. However, critics indicated that the effort fell short of what is required to address climate impacts in poorer countries.

President Saied took the opportunity to emphasize the vulnerability of Tunisians in the face of calls for economic reform from large lenders, including the IMF and the World Bank. President Saied noted that any steps taken must take into account the most vulnerable Tunisians. IMF MD Georgieva expressed agreement with this view.

Prior to his departure for the Summit, some Tunisian political leaders expressed concern about any deals that might be made in Paris, particularly those requiring Tunisia to settle migrants within Tunisia.

President Saied also met with Egyptian President Abdel Fattah el-Sisi to discuss bilateral cooperation. The two countries are both embroiled in difficult negotiations with international lenders, including the IMF, as public debts continue to grow in the face of painful economic reforms.

Outlook:  

President Saied continued to emphasize the need to protect vulnerable Tunisians in the face of economic reforms, an approach that has garnered some support and empathy from external lenders. While broad displeasure with the previously agreed upon reform program has been made clear, few concrete alternatives have been proposed.

Reports have indicated that Tunisia may seek to negotiate a revised set of reforms with the IMF in order to secure a loan deal. On Friday, the Central Bank Governor Marouan Abassi confirmed that this effort was underway, confirming rumors that had emerged after US Secretary of State Antony Blinken indicated his support for such an effort.

With a new set of requirements under negotiation, it is difficult to estimate how much time will be required to reach a new agreement with the IMF. As delays in the loan process continue, the pressure on the economy increases with rising prices and regular shortages.

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