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Inflation threatens purchasing power in Tunisia.. War and borrowing raise prices amid fears of the worst

Tunisia –The specter of inflation has returned to burden Tunisians once again, after the inflation rate rose to 5.5 percent last April, an indicator that raises growing concerns about purchasing power and price stability, amid warnings of the repercussions of the war and the high cost of internal borrowing.

Economists believe that the current crisis is linked to external factors related to turmoil in global energy markets and the repercussions of the war on Iran, in addition to structural imbalances within the Tunisian economy, including declining production, weak investment, and high distribution costs.

Tunisian financial and economic analyst, Bassam Al-Naifer, explained that food prices had the most impact on the rise in inflation, especially vegetables, fruits, meat and poultry, noting that some basic items recorded record increases that burdened the budget of Tunisian families.

Al-Niver also attributed part of the crisis to problems in agricultural production, after the damage caused by recent floods in some areas, in addition to disturbances in distribution chains and the rise in prices of some imported materials.

On the other hand, economics professor Reda Al-Shakandali considered that increasing internal borrowing represents one of the most prominent reasons for the return of inflation, explaining that the Tunisian government has increased the pace of borrowing in recent years to cover the financial deficit, which has contributed to increasing economic pressures.

Al-Shakandali warned of more complex scenarios if the war continues and oil prices rise globally, stressing that any increase in energy prices may lead to a major price fluctuation due to the connection of various economic sectors to fuels.

Despite these challenges, experts believe that state intervention by controlling the prices of basic materials and fuel has contributed relatively to limiting a greater rise in inflation, pending improvement in international conditions and the return of stability to energy markets.

Source:“My press”

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