Jhinaoui pursues “exceptional initiatives” in foreign assistance

Over the past several months, Tunisian Minister of Foreign Affairs Khemaies Jhinaoui has been proactive in soliciting extended support from the international community for Tunisia’s development. In May, he wrote in the Washington Times (not to be confused with the Washington Post or New York Times, the Washington Times is considered to have been an outlet of propaganda for the Ben Ali regime), “While we appreciate the assistance we have received from our friends, we also believe that the scope of support should be more commensurate with our challenges […] This calls for exceptional initiatives from the international community to spur the growth and development that our economy – and our people – need…”

The appeal was a precursor to a June 22 meeting with Minister of Development Yassine Brahim, when Jhinaoui announced a new mechanism of economic cooperation with the G7 countries as a means to “enable Tunisia to face financial and economic challenges without precedent and contribute to economic recovery through exceptional measures that transcend traditional support.” For his part, Brahim explained that the initiative would encourage investment and support the National Strategy for Development.

64% of Tunisia’s debt is external

In the meantime, data recently released by the Tunisian Ministry of Finance indicates that the country’s external debt in March 2016 was 30,295.8 million dinars, or 64% of the country’s total public debt. External debt has hovered around the same level since 2014, the year for which the most comprehensive breakdown of debt is available. In 2014, 61% of Tunisia’s total debt was external, or associated with multilateral (49.2%), market finance (28.8%), and bilateral (22%) loans. In terms of guaranteed debt by currency, the vast majority (77.1%) of guaranteed debt was in euros, followed by Kuwaiti dinars (9.7%), yen (4.4%), and US dollars (4.3%). These numbers beg the question of lending sources, whose loan agreements with Tunisia fall under the category of development assistance.

Top donors of development assistance to Tunisia

The G7 (Group of Seven) countries—United States, Canada, France, Germany, Italy, Japan, and the United Kingdom—with whom the Ministry of Foreign Affairs has affirmed reinvigorated economic collaboration—count among Tunisia’s most significant sources of foreign development assistance. According to the Organisation for Economic Co-operation and Development (OECD), the Top Ten Donors of Gross Official Development Assistance for Tunisia are, in order of their average contribution size for 2014 (the most recent ODA data year): EU Institutions, France, Turkey, Germany, Japan, the Arab Fund for Economic and Social Development (AFESD), Italy, Switzerland, the OPEC Fund for International Development (OFID), and the United States.

It is important to underline that this list of donors reflects gross ODA, or the amount that a donor actually spends in a given year, as opposed to net ODA which takes into account loan repayments. As the OECD points out, repayments may exceed gross amounts, which may explain why the world’s largest multilateral development banks, particularly the International Monetary Fund and World Bank, do not figure among Tunisia’s top donors of development assistance. These loan-granting giants aside, with the exceptional case of Switzerland, a significant—if not the majority—portion of foreign aid from each of Tunisia’s top gross ODA donors is in the form of loans.