Turkey giving Tunisia $100 mln to stave off crisis

Turkey giving Tunisia $100 mln to stave off crisis

Prime Minister Recep Tayyip Erdoğan and his Tunisian counterpart Hamadi Jebali met in İstanbul on Monday. (Photo: AA)

June 08, 2012, Friday/ 00:15:00/ TODAY'S ZAMAN WITH WIRES

Ankara will give Tunis $100 million in aid to help it overcome its social and economic difficulties, a Tunisian official announced on Thursday, even as an international analysis group warned about a brewing crisis in the North African country.

Tunisian Economy Minister Ridha Saidi said an accord was signed between the two countries during the World Economic Forum (WEF) held in Turkey. The deal also includes a $400 million low-interest loan. Saidi said $600 million in aid has been pledged by a number of countries, which would help Tunisia meet its financial obligations. Another $100 million aid grant is also expected from the US, he added.

Despite the geographical proximity and political alliance between Turkey and Tunisia, their bilateral trade volume has not grown in the past four years because of the global financial turmoil and the revolution that took place in Tunisia last year. The trade volume between the two countries declined from $1.14 billion in 2008 to $1.05 billion at the end of 2011.

The International Crisis Group warned in a report on Wednesday that Tunisia's government has been unable to address the desperate economic situation that helped spark the popular uprising that overthrew its ruler last year and that there is a risk of a new social explosion. In its report, the Brussels-based organization said the government needs to do more to deal with the problems of rising unemployment, regional economic discrepancies and corruption. "It so far has been unable to address them rapidly enough and is failing to quell the impatience of workers and unemployed youth who expect to reap the fruits of their involvement in past struggles," said the report. "Economic grievances are churning right below the surface. They could once again reach full boil."

Tunisians overthrew their long-ruling dictator in January 2011, sparking a wave of pro-democracy uprisings across the region. The North African country of 10 million is being closely watched around the region in its transition to democracy after half a century of dictatorship.

Tunisians went to the polls in October and elected a new assembly to run the country and write a new constitution. A long-oppressed moderate Islamist party dominated the elections and allied with two secular parties in December to form the country's most representative government ever, but it has been unable to offer short-term economic solutions.

Buffeted by an economic crisis in Europe, its main trading partner, and tourists spooked by uprisings across the region, the economy shrunk 1.8 percent in 2011, though initial signs suggest it is now improving.

Jobs still remain scarce and unemployment high. In the impoverished rural regions, the occasional job offers prompt tribal battles that have left dozens dead since the revolution, the report said. "The state has failed to restore its authority in several regions -- indeed, it appears to have been limping along ever since the dissolution of the omnipotent former ruling party. Corruption persists and provokes discontent and indignation," the report added. Tunisia's democratic transition has on the whole been more stable and less fraught than those in neighboring countries, but if new jobs aren't created quickly, especially in the impoverished regions, that experiment could be threatened, said the report.

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