World Bank Board of Directors: Loans to Support Tunisia in Facing Food Security Challenges

A $300 million loan will be added to the emergency project for food security, which aims to address the consequences of four consecutive years of drought in Tunisia, including a challenging grain season in 2023. This project aims to streamline wheat imports and support small farmers by providing barley for dairy production and weather-resistant seeds for wheat producers.

The World Bank’s Board of Directors approved two new loans for Tunisia on Thursday, totaling $520 million (1,613.8 million dinars). These additional funds will help the country meet food security challenges and reduce regional disparities through better road connections.

“These two projects are part of the World Bank’s partnership framework with Tunisia for the period 2023-2027, which aims to strengthen human capital and economic opportunities across the country,” said Alexandre Arrobbio, World Bank’s Operations Manager for Tunisia. In close collaboration with the Tunisian government, we have also worked to align these operations with key national strategies, including the 2023-2025 development plan, according to a statement released Thursday by the World Bank.

A $300 million loan will be added to the food security emergency project, which aims to address the consequences of four consecutive years of drought in Tunisia, including a challenging grain season in 2023. This project aims to streamline wheat imports and support small farmers by providing barley for dairy production and weather-resistant seeds for wheat producers. The financing is part of a comprehensive aid package coordinated with other development partners aimed at strengthening the country’s resilience to potential food crises.

Since the approval of the initial project in June 2022, Tunisia has been working to improve its cereal sector. Government measures aim to increase national production, reduce food waste, increase the added value of cereal value chains, and manage production risks related to drought. The project has provided barley to 126,000 dairy producers and “climate-smart” certified wheat seeds to 16,362 small-scale farmers, while ensuring the supply of bread through the importation of 160,099 tons of wheat.

The second loan, totaling $220 million, under the Economic Development Corridor project, aims to reduce regional economic disparities along the Kasserine-Sidi Bouzid-Sfax axis. To achieve this, infrastructure will be strengthened through road works covering 65 km and the modernization of 117 km of service roads. The project also includes the capitalization of the Impact Fund managed by the Caisse des depots et consignations (CDC) to improve access to financing for small and medium-sized enterprises (SMEs) in the region.

The project will benefit households whose movements are facilitated by improved road infrastructure and businesses through the road connections provided by the corridor, SMEs that will have smoother access to financing, and women who will have better access to agricultural land and financing.