EU considering major Tunisia aid package as migration surges

Tunisia's president Kais Saied shakes hands with European Commission president Ursula von der Leyen in Tunis, Tunisia 11 June 2023.

The European Union is considering over 1 billion euros ($1.07 billion) in aid for Tunisia to help develop its battered economy, rescue state finances and deal with a migration crisis, the EU Commission president Ursula von der Leyen said on Sunday.

Speaking in Tunisia, von der Leyen said 900 million euros in macrofinancial assistance, plus an immediate 150 million euros in budget support could be ready "as soon as the necessary agreement is found", without elaborating.

She said the EU would also this year provide Tunisia with 100 million euros for border management, search and rescue, anti-smuggling operations and returns "rooted in respect for human rights".

The EU, like other major donors to Tunisia, has so far conditioned its support on the country finalising a loan programme with the International Monetary Fund, but President Kais Saied has rejected key reforms required by that plan.

Saied has said cuts to subsidies and restructuring of state-owned companies, which his own government proposed to the IMF to reassure lenders they would be repaid, risked igniting a social explosion. Any new agreement based on different proposed reforms could take months more to negotiate.

Von der Leyen was accompanied by Dutch Prime Minister Mark Rutte and Italian Prime Minister Giorgia Meloni, whose country is the main arrival point for migrants crossing the Mediterranean from Tunisia.

Meloni, who also visited Tunisia last week, has pressed for the IMF to relax conditions for the loan. She said on Sunday the EU and Tunisia had already signed a joint declaration, which she hailed as an important step "towards the creation of a real partnership".

She said there was "an important window of opportunity" to finalise the aid agreement before the European Council at the end of June. It was not clear if Tunisia would still need to finalise its IMF programme to qualify.

Von der Leyen laid out a series of longer-term European efforts to help Tunisia's economy including ongoing projects for a 150 million-euro digital cable link to Europe and a 300 million-euro renewable energy power export project.

She said the EU would also expand opportunities for young Tunisians to study, work and train in the EU to help them develop skills that could be used to boost the Tunisian economy.