Tunisia's labour union says it opposes painful economic reforms

The head of Tunisia's powerful UGTT labour union on Wednesday said it opposed "painful" reforms wanted by lenders as the government seeks an international rescue package to avert a crisis in public finances.

The International Monetary Fund has urged reforms to reduce spending on state-owned companies, subsidies and the state payroll but UGTT head Noureddine Taboubi said in a speech that he opposed this.

"Public companies are not for sale and the public sector is a red line... painful reforms, forget it," he said, calling for wage increases in 2022 and 2023.

"If you want to discuss reforms, our vision for reform is comprehensive and deep, and its basis is fiscal justice," he added in his first speech since winning re-election as the union chief this month.

The UGTT says it has more than a million members and it has been able to shut down the economy with labour strikes, forcing governments to abandon previous policies.

Foreign lenders have said they would not regard reforms announced by Tunisian negotiators for an IMF loan deal as credible unless they had UGTT support.

An IMF deal is seen as vital to unlock other possible bilateral financial assistance from donors that have repeatedly bailed out Tunisia over recent years.

However, after years of economic stagnation, many Tunisians are already facing considerable hardship with few job opportunities, declining quality of government services and rising prices.

The problems with public finances already appear to be hitting Tunisia in the form of shortages of some subsidised goods, though the government has put the blame on private speculators.

(Reuters)