Croissance et Soutenabilité de la Dette Extérieure Tunisienne pour la Période 1970-2012: Une Analyse Dynamique

Growth and Sustainability of Tunisian External Debt for the Period 1970-2012: A Dynamic Analysis

Slah Slimani (), Sayef Bakari and Abdelhafidh Othmani

MPRA Paper from University Library of Munich, Germany

Abstract: Through this paper, we assess the sustainability of Tunisian external debt and its effect on the growth of the country. Based on two main approaches, namely the actuarial approach and the accounting approach, we check whether Tunisia was able to support its external debt during the period 1970-2012, while ensuring the balance of its economic fundamentals And its financial indicators. At a second level, we evaluate, empirically, the effects of foreign debt on the economic growth of the country in order to validate the thesis of over indebtedness for the case of Tunisia. Finally, we calculate, under a quadratic approach, the optimal sustainable external debt threshold that ensures regular economic growth and the sustainability of the country's fiscal policy. According to the actuarial method based on tests of stationarity and cointegration, it was not possible to verify, absolutely, the sustainability of the external debt during the period studied. Some tests verify sustainability, others have given contradictory results. The accounting method shows that this debt was no longer sustainable except for a few years, namely, 1972, 1974, 1996. This result reflects Tunisia's current situation of over-indebtedness, and the problem of external debt for Growth and economic performance. After calculating the external debt threshold, it seems that 51% is the sustainable threshold that allows maximum economic growth. This threshold of external debt stock can only be beneficial to the Tunisian economy if it is allocated to profitable investments that generate wealth and capital.

Keywords: Growth; Sustainability; External Debt; Dynamic Analysis; Tunisia. (search for similar items in EconPapers)
JEL-codes: A1 C32 E21 F0 F43 O4 O40 O55 (search for similar items in EconPapers)
Date: 2015-10
New Economics Papers: this item is included in nep-ara and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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