Tunisian president calls for amendments to central bank law

Tunisian Pres­ident Kais Saied on Saturday called for the law governing the central bank to be amend­ed, raising concerns the lender will lose its inde­pendence and of direct government intervention in monetary policy.

Saied said in a meeting with central bank Gover­nor Zouhair Nouri that “it is time to change the 2016 law” that granted the bank power over monetary policy, reserves and gold.

“We want a nation­al central bank, not as others wanted it based on dictates from abroad,” he added, in a video pub­lished by the presidency.

In October, dozens of Tunisian lawmakers proposed a bill that would strip the central bank of its exclusivity over interest rates and foreign ex­change policy, ending its independence.

The bank would only be able to take action in consultation with the government, but would be allowed to finance the treasury.

Saied told the gover­nor there had been many complaints about high interest rates.

The central bank has kept rates on hold at eight per cent since 2023, warning of the risks of inflationary pressures, despite calls from the president for cuts.

Last year, Saied said the central bank should lend directly to the state trea­sury to avoid costly loans through private banks.

Following Saied’s call, the parliament in De­cember approved a law allowing the central bank to provide $2.2 billion to finance the 2025 budget and pay off urgent debts – the second time in less than a year that the gov­ernment has resorted to the bank for funds.

The government is increasingly turning to domestic funding amid difficulties in securing Western finance since Saied seized nearly all power in 2021, ruling by decree, in a move the opposition has called a coup.

-REUTER