Current Deficit Narrows to -1.6% of GDP in 2024
The current deficit contracted to -1.6% of GDP, equivalent to -2.6 billion dinars, in 2024, compared to -2.3% of GDP in 2023 (-3.5 billion dinars), according to the report on "Balance of Payments and Global External Position of Tunisia (2024)" published on Thursday by the Central Bank of Tunisia (BCT).
Improved Services Balance and Tourism Revenue
This development is attributed to the increase in the services balance surplus (+22.7 billion dinars, compared to +21.2 billion dinars in 2023), following the strengthening of tourism revenues (+9.8%) and labor income (+12.7%). As a result, the ratio of coverage of the trade deficit by tourism revenues and labor income slightly improved to 57.7% in 2024, compared to 56% in 2023.
Worsening Trade Deficit
In contrast, the goods balance deficit widened, rising from -28.1 billion dinars in 2023 to -30.4 billion dinars in 2024, due to the 3.6% increase in imports and 1% decline in exports.
Stable Exchange Rate and Consolidation of Foreign Reserves
The BCT data also showed a quasi-stability of the average annual exchange rate of the Tunisian dinar (-0.2%) in 2024, respectively, against the euro and the US dollar, reflecting the good performance of the main indicators of the current account of the balance of payments, which allowed for the consolidation of foreign reserves.
Improved Domestic Demand
Regarding domestic demand, the main driver of economic growth in 2024, it improved by 4.3% in constant prices, linked to the vigor of private consumption and the recovery of investment. In fact, national consumption increased by 1.2% in 2024 (compared to +0.7% the previous year), driven by the recovery of public consumption (+1.4% compared to -0.2% in 2023) and the improvement of private consumption (+1.1% compared to +0.9%), favored by the relative easing of inflation and wage increases.
Financial Account
The financial account showed a financing need of 251 million dinars (MD) in 2024, compared to a financing need of 1,296 MD the previous year. "This result is attributable to the improvement in the 'portfolio investments and other investments' balance (+690 MD in 2024 compared to -2,436 MD in 2023), following the combined effect of the decline in mobilization of long-term external loans (-9.4%) and the increase in expenses for the repayment of the principal of long-term external debt (+27.3%)," the BCT explained in its report.
