Outlook for 2011-15

• It is uncertain whether the third interim government will be able to maintain its position, even though it has been stripped of all members of the former ruling party, the Rassemblement constitutionnel démocratique (RCD).
• Plans to hold the election for the National Constituent Assembly on July 24th have been postponed to October 16th. The assembly will be responsible for rewriting the constitution and organising parliamentary elections.
• At the very least, the delay in the assembly elections will prolong the state of uncertainty and may spark renewed protests. The political situation in Tunisia is likely to remain volatile until the assembly elections are held.
• Islamist parties will try to secure a position in Tunisian politics and government but will be competing against a plethora of new political parties, which have recently been licensed, as well as existing parties.
• The Economist Intelligence Unit expects government expenditure to rise substantially as the interim government implements measures to boost economic growth. The budget deficit will widen to 9.2% of GDP in 2011.
• We expect economic growth in 2011 to slow to 0.8%, slightly lower than government projections. Growth in 2011-15 is forecast to average 3.1% a year.
• The protests will have a negative impact on tourism revenue and trade, causing the current-account deficit to balloon to 10.3% of GDP in 2011, before falling in 2012. The current account will record surpluses from 2014.

Monthly review

• The National Constituent Assembly election has been postponed to October from July. The electoral commission has said it needs more time to prepare for the election.
• The composition of the Assembly has become clearer. It will have 218 seats, including 19 seats for Tunisians living abroad.
• Anti-government protests in Tunis in May have cast greater doubt on the intentions of the interim government.
• There have been inconsistent reports of a gun battle between al-Qaida militants and Tunisian police in May in northern Tunisia.
• Tunisia has managed to secure a large portion of the TD4.2bn (US$3.1bn) in external financing it needs for 2011, in part to roll out its emergency plan.
• The G8 nations have promised Tunisia US$25bn in aid over the next five years.
• Exports have grown strongly year on year in the first four months of 2011.