To boost wealth creation in the country, the investment budget should probably be excluded from the Finance Law and a new mechanism should be found to finance investment. This mechanism could be handled by the Deposit and Consignment Office,” said Secretary General of the Tunisian-French Chamber of Commerce and Industry (CTFCI) Mohamed Louzir.

“CDC could at the same time collect Tunisia’s assets, raise the necessary debt and surround itself with investors capable of investing, in a sustainable manner, amounts exceeding TND 10 and 15 billion per year so that Tunisia finds the path to growth again,” he added in a statement to TAP at the end of a seminar on the theme: “Finance Law 2024: What impact on business,” organised on Wednesday in Tunis by the CTFCI.

Louzir pointed out that “the budget dedicated to investment under the 2024 Finance Law is estimated at TND 5.274 billion. In my opinion, this amount would barely be enough to meet the needs of upgrading existing infrastructure, and could not be used to fin
ance new projects in strategic sectors such as education, transport and health.”

“Public investment has stagnated at around TND 4 billion since 2010. In 2010, investment accounted for 20% of the State budget, compared with 6.7% in 2023 and 2024. This low level of public investment is likely to have a major impact on economic growth,” he added.

“Public investment is a sign of confidence. If public investment is there, private investment will follow, and vice versa. One dinar of public investment is equal to 2 to 3 dinars of private investment,” the official considered.

“There is another driving force still untapped in Tunisia, that of the Public-Private Partnership. There’s a lot of talk about it, but it’s taking a long time to be implemented as we still don’t know how to manage a public-private partnership in Tunisia,” he added.

Referring to the main indicators of the 2024 Finance Law, Louzir said that “the economic growth rate is estimated at 2.1% for 2024, compared with 1.8% forecast by the 2023 Finance
Law and 0.9% forecast by the 2023 Amending Finance Law. But we still need to be able to achieve this rate.”

“The budget deficit, excluding grants and confiscation revenues, is expected to stand at TND 10,644 million, or 6.6% of GDP. State revenues are estimated at TND 49,160 million, up by 6% compared with the 2023 Finance Law and by 8% compared with the 2023 Amending Finance Law. Tax revenues grew by 9% compared with the 2023 Finance Law and by 12% compared with the 2023 Amending Finance Law. This increase in tax revenue paves the way for an acute tax burden of about 25.1%,” he explained.

“State expenditure is estimated at TND 59,805 million, up 11% on the 2023 Finance Law and 7% on the 2023 Amending Finance Law. The salaries to be distributed in 2024 total TND 23,711 million, i.e. the heaviest section in terms of expenditure. We have very high levels of public remuneration, with around 700,000 civil servants. However, individual pay levels are not high. Cutting salaries is therefore not a solution, nor is
making civil servants redundant. Instead, we need to ensure that civil servants produce more value,” Louzir considered.

“Financing needs are estimated at TND 28,708 million, or 16% of GDP, compared with 14% in 2022 and 9% for the period 2015-2019. The State’s debt is expected to increase at the end of 2024 to TND 139,997 million, up 9% on 2023. At the end of 2024, this debt should account for 79.81% of GDP, compared with 80.20% in 2023,” he reckoned.

“So many challenges, not easy to meet, by the Tunisian authorities in a complicated global economic context,” the official underlined.

As regards the impact on companies, “we can expect more tax to be paid, especially by companies operating in certain sectors, notably the financial sector. Companies will also be faced with the lack of major measures to encourage investment, apart from the mini-tax amnesty introduced for the benefit of certain companies, high inflation and the drying up of liquidity on the local market as a result of the State’s excessive relia
nce on domestic debt,” Louzir concluded.

Source: Agence Tunis Afrique Presse