Tunisia Prime Minister Quits After Failing to Form New Government

Wednesday, 20 Feb 2013 04:23 AM

 

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TUNIS, Tunisia — Tunisian Prime Minister Hamadi Jbeli announced his resignation Tuesday after failing to form a technocratic government to ease political tensions after the assassination of an opposition leader.

Jbeli announced his plan to step down at the presidential palace in Tunis in a speech carried live by Al-Jazeera television. He had promised to quit if his plan didn’t work, and said the decision was in “fulfillment of my oath before our citizens.”

The premier has backed an above-party government to stabilize Tunisia, where the wave of Arab unrest began with the overthrow of Zine El Abidine Ben Ali in January 2011, after the killing of Chukri Beleid this month.

Resistance came from within Jbeli’s own party, the Islamist Ennahda movement. Thousands of its supporters rallied earlier this week against the proposal.

Standard & Poor’s pushed Tunisia’s sovereign credit rating deeper into junk status Tuesday, citing increased political risks after the death of Beleid. It lowered long-term foreign and local-currency ratings by one notch to BB-, three levels below investment grade, with a negative outlook signaling further reductions.

The cut was the third by the ratings company since Ben Ali’s ouster. The Tunisian economy — which relies on agriculture, exports, tourism, and mining — is struggling to recover from its first contraction in at least two decades.

The budget deficit widened to a 12-year high 6.4 percent of economic output last year, according to International Monetary Fund estimates.

“Risks to Tunisia’s transition to democracy have increased markedly in recent weeks,” S&P analyst Patrick Raleigh wrote in a report Tuesday.

Disputes over the technocrat government plan have “highlighted deep divisions within the coalition” that impaired its ability to “take corrective measures against a weakening economic and financial backdrop,” it said.

© Copyright 2014 Bloomberg News. All rights reserved.

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