Tunisia’s economy is showing signs of recovery, driven by stronger agricultural production, a revival in the construction sector, and improving tourism, according to the World Bank’s latest economic update, “Strengthening Social Safety Nets for Increased Efficiency and Equity.” Real GDP grew by 2.4 percent in the first nine months of 2025, following years of moderate growth and lingering effects of the COVID-19 pandemic. Economic growth is projected to reach 2.6 percent in 2025 and stabilize around 2.4 percent in 2026–2027, although structural challenges such as limited external financing, subdued productivity growth, and low investment continue to weigh on the medium-term outlook.
Other macroeconomic indicators show continued improvement. Inflation fell for the seventh consecutive month, reaching 4.9 percent in October 2025, down from 10.4 percent in February 2023, largely due to lower global energy and cereal prices. Food inflation eased to 5.6 percent. The current account deficit widened to 2 percent of GDP in the first half of the year due to rising imports and stagnant exports, but strong tourism revenues and remittances helped mitigate external pressures. Foreign direct investment rose by 41 percent in the first seven months of 2025, primarily driven by investments in renewable energy. On the fiscal side, the budget deficit narrowed to 6.3 percent of GDP in 2024, while public debt remained at approximately 84.5 percent of GDP.
The World Bank report highlights the importance of Tunisia’s social protection system, particularly social assistance programs. The AMEN cash transfer program has been instrumental in reducing poverty and inequality, with coverage tripling over the past decade to reach about 10 percent of the population. The report recommends further improvements in targeting, regional equity, and the use of digital tools. It also emphasizes the need to expand economic inclusion and gradually extend insurance coverage to informal workers to create a more efficient and equitable social safety net.
World Bank Country Manager Alexandre Arrobbio noted that Tunisia has made significant progress in supporting the poorest segments of the population. Strengthening the efficiency and equity of social safety nets can reduce inequalities and promote economic inclusion for vulnerable households. Maintaining macroeconomic stability, improving fiscal sustainability, and expanding well-targeted social protection are essential for ensuring shared prosperity. Additionally, enhancing the performance of public enterprises and improving competition and investment conditions will be critical to sustaining Tunisia’s economic recovery.
