Announcement of World Bank Approves Industrial and Trade Policy Adjustment Loan for Tunisia on February 27, 1987

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 87/39 Contact: Fawzi Rihane (202) 477-5325 WORLD BANK APPROVES INDUSTRIAL AND TRADE POLICY ADJUSTMENT LOAN FOR TUNISIA WASHINGTON, February 27 -- The World Bank has approved a $150 million industrial and trade policy loan to assist Tunisia's economic growth. Two-thirds of the total will be disbursed upon effectiveness of the loan. Tunisia faces a balance-of-payments current account deficit due to the decline in oil prices, lower tourism revenues, and lower worker remittances. Over the longer term, a decline in its hydrocarbon exports is projected too. Thus, the country has decided to develop additional export revenue and to substitute imports. The Bank loan supports the first phase of the government's program of macroeconomic and industrial and trade policy adjustment. This program focuses on measures to stimulate growth of non-traditional exports and improve allocation and use of existing resources. It is also expected to result in the creation of more jobs. Changes in the overall incentives framework, investment code, institutional support to the sector and export promotion actions are expected to make Tunisia a more competitive producer of export products and import substitutes. The World Bank loan is for 17 years, including four years of grace, with a variable interest rate, currently 7.92 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balances. NOTE: Money figures are expressed in U.S. dollar equivalents.