Tunis , (AFP) - The International Monetary Fund announced on Tuesday that a delegation of its experts concluded a visit to Tunisia on Monday within the framework of negotiations conducted by the international financial institution with the crisis country to grant it an aid program, noting that the talks between the two sides had made "good progress."

"The Tunisian authorities and IMF experts have made good progress in defining the main parameters of the authorities' policies and reforms that a program with the IMF could support," the fund said in a statement.

"Discussions will continue over the coming weeks," he added.

In its statement, the Fund welcomed the Tunisian authorities' continued "advancement in its economic reform agenda in order to maintain macroeconomic stability, support inclusive growth, and strengthen social safety nets, as well as tax justice."

He also welcomed "the openness of the government and the social partners towards constructive dialogue regarding the implementation of a reform program that takes into account social considerations and supports growth."

"Discussions were fruitful on a new agreement under the Extended Fund Facility to support the authorities' economic policies and reforms," the statement quoted mission chief Bjorn Rutter as saying.

He added that IMF staff and Tunisian officials "will continue discussions over the coming weeks with the aim of reaching an agreement at the expert level."

"As always, final agreement on a new programmatic arrangement will be subject to approval by the Fund's Executive Board," said Piotr.

The statement also affirmed that Tunisia "is making significant progress in its economic agenda, taking into account good coordination between ministries and agencies on the basis of a sound common vision. It is now necessary to accelerate the pace of its implementation."

Negotiations between Tunisia and the IMF focus on the reform program proposed by the government headed by Naglaa Boudin. The fund stipulates that the loan be accompanied by the implementation of radical reforms.

Experts estimate that the loan amount is about two billion euros.

Tunisia requested this loan to help it deal with an acute financial crisis that worsened after President Kais Saied monopolized the executive and legislative powers in July 2021.

The government proposed to the International Monetary Fund a reform plan that provides for freezing the salaries of public sector employees, reducing subsidies for basic commodities, and restructuring public companies.

However, the Tunisian General Labor Union rejected the government reform plan demanded by the International Monetary Fund.

The IMF had referred to the "major structural challenges" facing Tunisia in light of "deep macroeconomic imbalances, very weak growth despite its strong potential, a very high unemployment rate, very weak investment, and social inequalities."

Added to these major difficulties was the impact of the war in Ukraine, which caused an increase in the prices of agricultural products. Ukraine and Russia are traditionally the main suppliers of wheat to the Maghreb countries.

In its statement issued on Tuesday, the IMF confirmed that the repercussions of the invasion of Ukraine and the Covid pandemic “constitute pressures that increase the basic structural weaknesses” that the Tunisian economy suffers from.

The statement warned of "challenges surrounding the near-term prospects, as growth is likely to slow while rising international prices for energy and food lead to an increase in already high inflation and an increase in the fiscal and external deficit, as well as debt."

The statement stressed the need to "take urgent measures in order to reduce these imbalances in a socially sustainable manner."

As for the IMF, "broad support will be necessary to accomplish the urgent task of reducing macroeconomic imbalances, promoting stability and supporting job-creating growth, which is a prerequisite for activating the enormous potential of the Tunisian economy in the interest of all citizens."

In its statement, the Fund appealed to "the international community to play an important role in facilitating the authorities' program by expediting the disbursement of the required funding," stressing that "this is indispensable to ensure the success of the authorities' efforts in terms of policies and reforms."