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(Bloomberg) -- Tunisia’s President Kais Saied used a rare meeting with the International Monetary Fund’s chief to stake out his opposition to spending cuts and policy changes necessary to secure a bailout from the lender despite his country’s dire finances.
At talks held late on Thursday with IMF Managing Director Kristalina Georgieva, Saied “made it clear” that the fund’s “prescriptions to provide financial support to Tunisia are unacceptable because it would affect civil peace, which is priceless,” his cabinet said in a statement.
The encounter on the sidelines of a conference in Paris risks delaying further assistance from the IMF even though Saied previously expressed criticism of what he calls foreign “diktats” that could further impoverish the country.
Saied, who’s been accused of undermining Tunisia’s democratic norms, is under pressure to deliver on measures such as slimming down a bloated public sector as well as revamping subsidies and the tax system to make Tunisia’s debt burden more sustainable.
Tunisia reached a $1.9 billion IMF deal last October, but the pact has yet to be reviewed for approval by the fund’s directors. A breakthrough hinges on additional support from Tunisia’s allies and the government’s implementation of measures that are required to access funds.
While Tunisia remains in a deadlock with the IMF, the World Bank this week agreed on a new five-year partnership with the government after temporarily pausing some discussions with it following an outbreak of violence against Black migrants that’s been blamed in part on comments made by Saied.
For now, the discussion with the IMF centers on reaching a “fair” reforms program that looks out for both vulnerable groups and the middle class at a time when inflation is high, central bank Governor Marouane El Abbassi said in remarks carried by state news agency TAP.
“Planning a fair reform agenda is a fundamental issue — the World Bank has understood it and the IMF must also understand it,” El Abbassi said, adding that Georgieva told him this week that the fund also wants a “fair” program.
Saied’s message to the IMF’s chief also included a reference to deadly bread riots that hit Tunisia in the 1980s after authorities reformed subsidies on wheat. The president “will not accept that a single drop of blood is shed,” his cabinet said in the statement.
Saied also invited Georgieva to visit Tunisia and she welcomed the offer, according to the statement. The presidency said it would set a date for the visit.
(Updates with remarks from Tunisian central bank governor starting in sixth paragraph.)
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