Tunisian parliament debates new coalition with economy in focus

TUNIS (Reuters) – Tunisia’s parliament began debating on Wednesday and looked set to approve a new coalition government, after months of political wrangling that has slowed the north African country’s efforts to tackle looming economic problems.

Elyes Fakhfakh, who was designated prime minister last month by President Kais Saied, has brought parties from across the political spectrum into his cabinet – and they continue to disagree on several big policy areas.

His government is expected to pass a confidence vote later on Wednesday, however, though it may prove fragile after struggling to reconcile the differences over policy and cabinet positions.

If it were to lose the vote, another parliamentary election would be held.

The last election, held in October, produced a deeply fragmented house in which no party won more than a quarter of the seats. An earlier attempt to form a government was defeated in a confidence vote in January.

Introducing his proposed government’s program in parliament on Wednesday, Fakhfakh said its priorities would include fighting widespread corruption and reforming public services and the state phosphate producer.

It would work to maintain the value of the currency, which has recovered in recent months after years of decline, he added. Central Bank governor Marwan Abbasi said this month that the International Monetary Fund had been in favor of the dinar losing some value to bolster exports.

The new government would immediately face a major economic challenge after years of low growth, persistent unemployment, big government deficits, mounting debt, high inflation, a weak currency and deteriorating public services.

It will need to find new external financing after an International Monetary Fund (IMF) loan program ends in April, with no new support yet agreed.

Parliament speaker Rached Ghannouchi said he would also start the process for voting judges onto the constitutional court, a body agreed in the 2014 constitution to arbitrate disputes between branches of government but not yet set up.

(Reporting by Tarek Amara, writing by Angus McDowall; Editing by Hugh Lawson)