Tunis: "The failure of public banks to implement the decision to lower interest rates could create a crisis in the housing sector and threaten the interests of real estate developers and customers," said economic expert and financial risk specialist Mourad Hattab.

In a statement to TAP, Hattab explained that the application of the amended Article 412 of the Commercial Code, which stipulates a reduction in interest rates, represents a step in the process of reforming financial and banking laws in the country.

The law was enacted in line with international standards, as long-term loans should be granted at fixed interest rates to protect bank customers from interest rate fluctuations, he noted.

Therefore, the non-implementation of this law deprives households of their right to obtain decent housing, he added.

According to the expert, several indicators suggest that some banks are preparing to cancel government programmes from their debt plans, such as the first-house programme, which aims to address the housing issue, under the pretext that these programmes could impact their profits. Hattab warned against such practices, which could even undermine the social role of the state in favour of middle and low-income social groups.

On February 21, 2025, President Kaïs Saïed met Governor of the Central Bank of Tunisia (BCT), Fethi Zouhair Nouri, at the Carthage Palace. The meeting addressed the implementation of the amended Article 412 of the Commercial Code, which relates to the reduction of fixed interest rates applied to loans.

The Head of State emphasised the role of the central bank in overseeing the entire banking sector and the imperative for all public and private banks to comply with the laws established by the Tunisian state. He also stressed the obligation of the BCT to ensure compliance with the law.

Hattab highlighted that the outstanding housing loans (the remaining amounts owed to banks by households) reached 12.9 billion dinars by the end of September 2024, while the outstanding loans for home improvement amounted to 10.8 billion dinars during the same period, according to data published by the BCT in its Note No. 228 released in October 2024.

The interest rates applied to these loans range between 10.86% as the average effective interest rate and 13.03% as the maximum interest rate, according to data from the Ministry of Finance. These rates are considered very high by the expert.

The housing sector is one of the pillars of the national economy, but it has experienced continuous price increases.

During the first quarter of 2024, the price index for built residential real estate assets increased by 3.5% on a quarterly basis, compared to the fourth quarter of 2023, according to data from the National Institute of Statistics (INS).

The housing sector also has significant financial obligations to banks, estimated at around 3.2 billion dinars by the end of September 2024.

In this context, Hattab emphasised that the absence of a comprehensive reform of the sector's financing system will undoubtedly lead to a housing crisis. He added that this situation would significantly disrupt the national economy.

In the same context, he expressed his astonishment at the blockage of several laws, which is hindering the realisation of numerous national projects and megaprojects, thereby obstructing the development process.

It is worth noting that the Ministry of Public Works and Housing is working in collaboration with various stakeholders to develop a new housing strategy for Tunisia.

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