Coronavirus may cause 400,000 travel-related job losses in Tunisia
The coronavirus pandemic has devastated Tunisia's tourism industry, with the vital sector expected to see 400,000 people lose their jobs this year and $1.4bn in lost revenue.
Like many countries across the globe, Tunisia has been under lockdown for weeks, with most residents only leaving their homes for exercise, grocery shopping and pharmacy runs.
But as the second-biggest contributor to the country’s economy after agriculture, the tourism industry has almost completely shut down. Restaurants have closed, as have hotels and land borders, and international flights have been banned.
To mitigate the economic effects of the pandemic, Tunisia is seeking to secure a loan for bonds it plans to issue later this year. The bonds will be worth up to $877m, according to Reuters.
The move is a crucial step in propping up the Tunisian economy, which had been struggling even before the Covid-19 outbreak.
In a recent letter to the International Monetary Fund (IMF), Tunisian officials warned that the country's economy will shrink as much as 4.3 percent during the pandemic. The drop may be the worst Tunisia has seen in nearly 70 years.
So far, the IMF has approved a $745m loan to Tunisia, but the country is also seeking other funds to support its crippled economy.
"We are working with partner governments on a potential guarantee for future sovereign bond issuances in the current difficult international context," Reuters quoted the central bank governor and finance minister as saying on Wednesday.
The European Union has also granted funds of up to 250 million euros ($273m) and Italy has pledged 50 million euros ($55m) to the Tunisian government.
Once a booming industry
In the past, tourism accounted for about 8 percent of the country's GDP. But in recent years, as other sectors of the economy took hits, tourism has been on the rise, filling some of those gaps and boosting its share of GDP.
The increase in tourism had been a blessing for the country's economy, which entered a period of decline when President Zine El Abidine Ben Ali was removed from office during the 2010-2011 uprising.
Since then, Tunisia's economic growth has averaged 1.8 percent a year, significantly lower than annual averages had been in the decade before.
Now, under the pandemic, that number is expected to plummet.
Tunisia has recorded a total of 747 cases of the virus and 34 coronavirus-related deaths. So far, 43 people have recovered from the infection.
Tunisia's number of cases falls well below neighbouring Algeria, which has reported 2,160 cases and 336 deaths, highlighting the need to ban tourism in order to slow the spread, as tourists from Algeria, Russia and the EU make up a large portion of the country's yearly visitors.
In a report released on Wednesday, the IMF said in general, economies across the Middle East and North Africa are expected to shrink by 3.3 percent during 2020.