Euroviews. Tunisia must break free from reliance on short-term economic fixes

Tunisian President Kaïs Saïed recently declared that central bank autonomy should not equate to independence from the state. 

Saïed insisted that autonomy applies to monetary policy but not the financing of the state budget. This comes in the wake of the recent postponement of the IMF mission to discuss the monetary fund's deal for Tunisia.

President’s declaration against the Central Bank’s autonomy has marked the apex of a series of assaults on its sovereignty, aimed at overturning Article 25 of its current statute which prohibits direct financing of the state budget. 

The bank's governor, Marouane El Abassi, had previously warned that central bank financing of the budget would spike inflation uncontrollably and replicate the Venezuelan scenario in the country.

But what motives underlie Saïed’s unsettling efforts to overturn Article 25?

More than a year has passed since Tunisia inked a $1.9 billion (€1.73bn) preliminary agreement with the IMF, led by then-Head of Government Najla Bouden's economic team on 15 October 2022. 

The agreement targeted financial imbalances through measures like cutting untargeted subsidies, trimming the public sector wage bill, and reforming loss-making public enterprises.

Saïed's populist rejection of the IMF deal, citing it as a tool of Western imperialism, follows his moves to consolidate one-man rule since September 2021. 

Governing Tunisia unilaterally through decrees, bypassing the constitution, and suppressing critics, Saïed has overseen a worsening economic crisis marked by growing poverty, essential item shortages, and soaring prices. 

He considers that implementing IMF reforms could trigger protests, posing a challenge to his political control.

The commitment to implement crucial reforms for