The European Union has approved the disbursement of a €200 million loan to Tunisia, marking the launch of the second Macro-Financial Assistance (MFA) to the North African country. The new tranche will be distributed in three installments in 2017 and 2018. Pierre Moscovici, Commissioner for Economic and Financial Affairs, commented that the financial aid to Tunisia was proof of the EU’s strong commitment to support the economic recovery of one of Europe’s closest neighbors. “With a renewed sense of urgency, Tunisia has reaffirmed its dedication to an effective partnership. The EU stands firmly with Tunisia in achieving prosperity for all of its people.”
The new financial package was proposed after the 2015 attacks, which stopped Tunisia’s economic recovery. This had a significant impact on the country’s balance of payments position and financing needs, so the second and third installment of the MFA-II (totaling €150 million each) will be tied to the implementation of a number of policy conditions, targeting fiscal consolidation as well as the improvement of the country’s social assistance schemes and business climate.
MFA is an exceptional EU crisis response instrument available to the bloc’s partner countries. It is complementary to the assistance provided by the International Monetary Fund. MFA loans are financed through EU borrowing on capital markets. The EU’s support to Tunisia also includes substantial loans from the European Investment Bank and budget programs under the European Neighborhood Instrument of which Tunisia is a major recipient. Since the revolution of 2011, the EU has been continuously supporting Tunisia in its transition to democracy. The EU’s assistance to Tunisia since the 2011 revolution has so far amounted to over € 1 billion.
