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Analyse de la Soutenabilité de la Dette Extérieure de la Tunisie pour la Période 1970-2012
[Analysis of the Sustainability of Tunisia's External Debt for the Period 1970-2012]

Author

Listed:
  • Slimani, Slah
  • Othmani, Abdelhafidh
  • Bakari, Sayef

Abstract

The ultimate concern of States' economic policies is to mobilize domestic and external financing resources to stimulate investment and growth without jeopardizing medium- and long-term fiscal sustainability. It is agreed that the risk incurred is to pursue an expansionary fiscal policy that does not ensure the sustainability of the debt, essentially the external debt. To avoid this risk, the government must adhere to three principles: the temporary increase in public spending through the tax bill and domestic and foreign debt, targeting high-return investment spending, and respecting the conditions of the sustainability of the debts granted. Through this paper, it is proposed to analyze the sustainability of the Tunisian foreign debt for the period 1970-2012 in order to frame the orientations of the State and the stakes involved in MLT. For our part, we return to a profound examination of the problem of foreign debt, based on their historical evolution since independence. This descriptive analysis allowed us to draw some conclusions. Tunisia's use of external indebtedness is explained by two stylized facts: national savings do not make it possible to finance the needs of investments that create growth, the structural deficit of the current account due to the net foreign currency holdings, Mostly external indebtedness and the increase in debt servicing, which is only used to finance productive and profitable investments. Also, it seems clearer to the government to resort more to taxation instead of external debt, essentially, in terms of direct taxation by fighting against tax evasion. Similarly, it seems very useful to re-examine the distribution of public expenditure in favor of growth-oriented expenditure at the expense of certain administrative expenditure and to make the national banking system and the financial market more efficient to ensure the efficient 'economy.

Suggested Citation

  • Slimani, Slah & Othmani, Abdelhafidh & Bakari, Sayef, 2015. "Analyse de la Soutenabilité de la Dette Extérieure de la Tunisie pour la Période 1970-2012
    [Analysis of the Sustainability of Tunisia's External Debt for the Period 1970-2012]
    ," MPRA Paper 80824, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:80824
    as

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    File URL: https://mpra.ub.uni-muenchen.de/80824/1/MPRA_paper_80824.pdf
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    References listed on IDEAS

    as
    1. Carmen M. Reinhart & Vincent R. Reinhart & Kenneth S. Rogoff, 2012. "Public Debt Overhangs: Advanced-Economy Episodes since 1800," Journal of Economic Perspectives, American Economic Association, vol. 26(3), pages 69-86, Summer.
    2. Alesina, Alberto & Tabellini, Guido, 1989. "External debt, capital flight and political risk," Journal of International Economics, Elsevier, vol. 27(3-4), pages 199-220, November.
    3. Cohen, Daniel, 1993. "Low Investment and Large LDC Debt in the 1980's," American Economic Review, American Economic Association, vol. 83(3), pages 437-449, June.
    4. Hansen, Bruce E., 2000. "Testing for structural change in conditional models," Journal of Econometrics, Elsevier, vol. 97(1), pages 93-115, July.
    5. Toan Quoc Nguyen & Benedict J. Clements & Rina Bhattacharya, 2003. "External Debt, Public Investment, and Growth in Low-Income Countries," IMF Working Papers 03/249, International Monetary Fund.
    6. Andrews, Donald W K & Ploberger, Werner, 1994. "Optimal Tests When a Nuisance Parameter Is Present Only under the Alternative," Econometrica, Econometric Society, vol. 62(6), pages 1383-1414, November.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Sustainability; External Debt; Economic policies; Tunisia;

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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