Tunisia is facing an economic downturn like never before, Prime Minister Hicham El Mechichi said on Tuesday.
Mr El Mechichi said that the coronavirus crisis had directly affected the nation's economic health, with lockdowns in March and April causing ramifications that could last for two or three years.
Mr El Mechichi said he had met economists and has more meetings scheduled to discuss ideas and proposals that could be relied upon to solve Tunisia's problems.
His comments came as the government withdrew a supplementary budget bill for 2020 that would have entailed the biggest deficit in decades, after both parliament and the central bank demanded it cut its spending plans.
Parliament’s finance committee last week rejected the bill, which would have widened the fiscal deficit to 14 per cent of GDP, and increase expenditure by about $4 billion.
During a press conference on Tuesday at the Ennejma Ezzahra palace at Sidi Bou Said, Mr El Mechichi said that there was no room to cut off the production of phosphates and petroleum in a difficult economic situation.
He said that doing so would damage the livelihoods of all Tunisian householders, and their incomes. Mr El Mechichi added that cutting off the production of natural resources will affect other sectors, including health.
Tunisian MP Munji Rahwi denied rumours that the government could not pay wages and may be nearing bankruptcy.
In a statement to Shams radio, Mr Rahwi said that wages were available and bankruptcy was a "ghoul" used to intimidate Tunisians.
