In order to lessen the effects of the country’s food and fuel shortages, Tunisia is about to finalize an agreement with the IMF that would allow it to receive a $1.9 billion loan. In addition, Morocco is considering withdrawing $1 billion from its IMF loan line, abandoning earlier intentions to issue bonds.
The strain of repaying foreign-denominated debt has increased as the Tunisian dinar has declined 15% versus the dollar this year and the Moroccan dirham has fallen 22%.
While a slow pace of economic reform in Tunisia, notably in the agriculture sector, may hinder recovery for the dinar, we anticipate that Morocco’s IMF stance will strengthen the dirham. International creditors have in the meantime cast doubt on the possibility of debt relief for Chad, claiming that the government has profited from increased oil prices.
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