PM says Tunisia is keen to fulfil foreign debt obligations

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SOUSSE, Tunisia, Dec 10 (Reuters) - Tunisia will continue to fulfil its foreign debt obligations and has started preparatory work for an IMF deal, Prime Minister Najla Bouden said on Friday, as talk of a possible default swirls among local and foreign analysts.

Her comments echo those of Finance Minister Sihem Boughdiri who said at an economic conference on Thursday that Tunisia was far from rescheduling its debts within the Paris Club, despite its financial difficulties.

"The Tunisian state is keen and will continue to fulfil its foreign debt obligations due to Tunisia's foreign currency reserves level," Bouden told an economic conference in Sousse.

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Tunisia facing its worst economic crisis after its economy contracted 8.8% last year and the fiscal deficit reached a record 11.4%.

Economists have warned that Tunisia’s foreign currency reserves will decline significantly with the debt repayments, hurting the value of the local dinar currency.

Central bank figures showed on Friday that foreign currency reserves had reached 7.02 billion, the equivalent of 119 days of imports.

The North Africa country resumed talks last month with the International Monetary Fund on a loan package predicated on Tunis imposing painful and unpopular reforms.

Bouden told the conference the government had started preparing an advanced draft in order to reach a deal with IMF that will send positive signals to partners and allow for an improvement in its credit rating.

Central bank Governor Maroaune Abassi said on Thursday the government hoped to reach an agreement with IMF in the first quarter of next year on a rescue programme.

($1 = 2.8778 Tunisian dinars)

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Reporting by Tarek Amara; Editing by Andrew Cawthorne and Alison Williams

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