Tunisia - The Arab Institute of Business Leaders (French: IACE) said the Central Bank of Tunisia (French: BCT) and Tunisian banks authorised to purchase Tunisian bonds abroad – which are impacted by credit ratings- will help the State generate profits by buying bonds at a low prices and selling them later.

Tunisia's sovereign bonds maturing in 2025, the value of which amounts to $1 billion, declined in March 2023 by 62% against 68% in February 2023 and almost 77% in December 2022, the institute Tuesday said in a document on "the Evolution of Tunisia's Sovereign Rating."

Tunisia has bonds worth 22.4 billion yen, or about $168 million, maturing next August, in addition to debts worth €500 million maturing in October 2023.

In April 2023, the nominal value of the majority of bonds decreased by half following a decline of 0.2 to 1.3 cents (100 cent = 1 dollar), i.e. nearly 3.07 dinars, hitting the lowest level in the last 6 months after the call launched by President of the Republic Kais Saied to rely on national resources before seeking foreign resources.

Since early 2023, Tunisian bonds have been showing signs of instability. Tunisia's sovereign bond index issued by Standard & Poor's reached 149.28 in May 2023, that is a 5.97% rise compared to 2022, after reaching its lowest level in February.

The IACE argued that rating agencies assess credit risks of debt obligations and borrowing countries and provide an independent assessment of the creditworthiness of bonds issued by governments and enterprises, while the market value of bonds shows increase or decrease despite several factors, including the State's ability to pay its debts and the State's sovereign rating.

On June 9, 2023, Fitch Ratings downgraded Tunisia from CCC+ to CCC-.

The agency said the downgrade is due to increasing financing risks resulting from uncertainty about Tunisia's ability to mobilise sufficient resources so as to meet the government's significant financing needs.

The government's financing needs will rise to nearly 16% of GDP in 2023 (about $7.7 billion) and 14% of GDP in 2024 ($7.4 billion).

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