Fitch lowered the outlook for the rating of Tunisia – Jeune Afrique

 The rating agency has lowered from “stable” to “negative” the outlook for the rating of Tunisia maintained at “BB-”.

In its report published on Friday 04 March, the agency based in London and New York, attributes the decision to the deterioration of growth prospects of the country, a result of the difficulties experienced by the tourism sector in the wake of the terrorist attacks of Bardo and Sousse in 2015.

Tourist revenues down 35%

the revenue of the tourism industry in Tunisia decreased by 35% in 2015, says Fitch. “The collapse of tourism in the context of increased security risks has contributed to a slowdown in GDP growth of 2.3% in 2014 to only 0.8% in 2015, its lowest level since the revolution 2011, “Fitch points out.

the agency revised down its growth forecast for Tunisia to 1.2% for 2016, against 2% previously, and 2% for 2017 , against 3% previously.

Fitch also highlights a “weakening” of the situation of public finances. The agency estimates that the budget deficit reached 5.3% of GDP in 2015 (against 4.5% in 2014, again according to Fitch), due to wage increases, the cost of recapitalization of state banks but also of the lower revenue from taxes on businesses, despite the drop in energy subsidies.

the 2016 budget, regrets the rating agency “is far better” distribution budget items, with a public payroll representing 60% of revenues, while capital investments declined. They reached 5.3% of GDP in 2015, against an average 7.5% in previous years.

At the same time, Fitch continues, public debt (of which two thirds are denominated in foreign currencies Foreign) approaching 53% of GDP in 2015, against a median level of 43% in other countries rated “BB-” by the agency, which estimates that the debt is expected to grow to 58.4% of GDP in 2017. the net external debt reached 46% of GDP in 2015, against 35% a year earlier. It should reach 50% by 2017, warns rating agency.

A lighter energy bill

The only positive sign, the current account deficit should subside, mainly because of lower energy costs, the result of declining oil prices. It should reach 7.5% of GDP in 2016 and 2017, against 8.7% in 2015.

Among the factors that could cause the Anglo-American agency to downgrade the country included political destabilization the country because of the threat of terrorism or civil unrest, increased public debt and current account deficit. However, better growth prospects and a reduction of budget deficits could lead Fitch to raise the rating of Tunisia

. Joel Tee-Lesya