Aswat Asharq Al-Awsat :

Aswat Asharq Al-Awsat : Tunisia to Receive 450 Million Euros in European Loans, Grants

Members of the honor guard stand at attention during a flag-raising in place of Kasba in Tunis, Tunisia, June 26, 2018. REUTERS/Zoubeir Souissi
Members of the honor guard stand at attention during a flag-raising in place of Kasba in Tunis, Tunisia, June 26, 2018. REUTERS/Zoubeir Souissi
TT

Tunisia to Receive 450 Million Euros in European Loans, Grants

Members of the honor guard stand at attention during a flag-raising in place of Kasba in Tunis, Tunisia, June 26, 2018. REUTERS/Zoubeir Souissi
Members of the honor guard stand at attention during a flag-raising in place of Kasba in Tunis, Tunisia, June 26, 2018. REUTERS/Zoubeir Souissi

The European Investment Bank on Tuesday announced grants and loans worth 450 million euros ($480 million) for crisis-hit Tunisia to support small and medium-sized enterprises and infrastructure projects.

The EIB, the European Union's investment arm, said it was providing "new financial support" to Tunisia, targeting "high-impact projects for the population and the country's economic and social development".

The financing will be formalized during the Tunisia Investment Forum to be held on Wednesday and Thursday in Tunis, the bank said in a statement.

The forum will be attended by the EIB's new vice-president in charge of financing in the Maghreb region, Ioannis Tsakiris, Reuters reported.

The funding "will play a crucial role in the creation of jobs, stimulating innovation and promoting balanced development to benefit all Tunisians", Tsakiris said in the statement.

The financing includes a line of credit worth 170 million euros for micro, small and medium-sized enterprises, "which make up 90 percent of the country's businesses and employ 60 percent of the workforce", according to the bank.

It will also provide 210 million euros to develop the "strategic" route between Tunisia's second city of Sfax on its eastern coast and the remote, underserved Kasserine area in the west.

A loan of 45 million euros will be granted to finance the ELMED electricity linkage project between Tunisia and Italy.

Tunisia has faced mounting financial woes, with debt levels at 80 percent of its GDP and unemployment and poverty on the rise.

The crisis has been compounded by the power grab staged by President Kais Saied since July 2021.

Negotiations with the International Monetary Fund for a $2 billion loan have stalled since then, with Saied rejecting reforms demanded by the body.

The crisis has driven thousands of Tunisians to attempt perilous Mediterranean boat crossings in the hope of finding better lives in Europe.



Aswat Asharq Al-Awsat : Saudi SAMA Explores Potential of Digital Currencies to Facilitate Payments Globally

The Saudi Central Bank. (Aswat Asharq Al-Awsatt)
The Saudi Central Bank. (Aswat Asharq Al-Awsatt)
TT

Saudi SAMA Explores Potential of Digital Currencies to Facilitate Payments Globally

The Saudi Central Bank. (Aswat Asharq Al-Awsatt)
The Saudi Central Bank. (Aswat Asharq Al-Awsatt)

With many consumers abandoning physical cash, and in light of the accelerating development of crypto-currencies, central banks in the world have started working to ensure a legal and safe cover for the use of digital currencies.

According to the Bank for International Settlements (BIS), 135 countries and monetary unions, representing 98 percent of global GDP, are exploring digital currencies for central banks, compared to only 35 countries in 2020.

The International Monetary Fund (IMF) indicates that about two-thirds of the countries in the Middle East and Central Asia are considering adopting digital currencies for their central banks as a means to enhance financial inclusion and improve the efficiency of cross-border payments.

The Central Bank of Saudi Arabia (SAMA) joined as a full participant in a multi-country digital currency initiative, known as the mBridge project, which was positioned as a potential alternative to the SWIFT payment system to enable faster and potentially cheaper international payments.

Head of Development at Binance in Saudi Arabia Bandar Altunisi told Aswat Asharq Al-Awsatt that the mBridge project was a cooperative initiative led by the BIS to explore the potential of digital currencies issued by central banks to facilitate trade and instant cross-border payments.

The project includes the central banks of China, Thailand, Hong Kong, the United Arab Emirates and Saudi Arabia.

In addition to the five participating central banks, the project includes 27 other official entities with observer status, such as the IMF, the World Bank, and central banks in many countries, including Norway, South Korea, and Türkiye, according to Altunisi.

“The mBridge project, which was launched in 2021, represents an innovative solution to address the gaps and challenges of inequality in the current procedures used for cross-border payments,” he explained.

Altunisi believes that the success of this project will contribute to accelerating cross-border payments and reducing their cost.

As for the importance of this project for Saudi Arabia, he noted that it will provide new settlement solutions for oil and gas exports. On a broader scale, trade will become more efficient, ultimately benefiting all parties involved, including the final consumer, he remarked.

He added that additional expertise in the field of Blockchain and distributed ledger technologies (DLT) provided by the mBridge project will give regulatory authorities in Saudi Arabia more comfort and ease in allowing broader regulation and application of crypto-currencies and other solutions based on Blockchain technology.

Altunisi spoke about the difference between digital currencies that central banks are considering adopting and encrypted ones, such as Bitcoin and Ethereum. He noted that the latter are decentralized currencies that use encryption techniques to boost the security of transactions and rely on Blockchain technology to ensure transparency and immutability of transaction records.

Digital currencies are digital copies of paper currencies issued and regulated by central banks, Altunisi stated, adding: “Unlike crypto-currencies, these digital currencies are centralized and usually aim to improve the efficiency of payment systems, bolster financial inclusion, and provide governments with better monetary policy tools.”