Tunisian central bank wary of interference

Reuters, Saturday 7 Jul 2012

Governor of Tunisia's central bank publicly comments for first time on president Moncef Marzouki's announcement that Nabli would be sacked due to splits over economic policy

Mustapha Nabli
Nabli who used to be chief Middle East economist for the World Bank, was appointed days after last year's revolution. (Photo: Reuters)

Tunisian central bank governor Kamel al-Nabli warned on Friday that political interference in monetary policy would alarm investors already jittery after last year's revolution as he rejected a presidential push to remove him from office.

President Moncef Marzouki's spokesman said last month that Nabli would be sacked due to splits over economic policy. Such a decision, though, requires approval of the elected constituent assembly, whose members have so far shown little enthusiasm.

In his first public comments since the row broke out, Nabli said efforts to drag the central bank into broader political disputes would undermine its independence and hit confidence.

"The decision is incompatible with the independence of the central bank and the involvement of the bank in political conflicts is dangerous," he told a news conference.

"There is a concern among investors who are watching very carefully what is going on now... What is going on now is having an negative impact on Tunisia's position in the global financial market."

Tunisia, struggling to emerge from recession, has held a steady course on inflation, interest and exchange rates even in the turmoil that followed the ousting of veteran dictator Zine al-Abidine Ben Ali in January last year.

But tensions have emerged in recent months between the government and the central bank over who has the last say in monetary policy.

When the government unveiled an inflation target for the year, Nabli complained that this figure was set by the central bank and that he would not accept political interference.

The dispute has taken on political overtones and the three parties in the coalition government, led by the Islamist Ennahda party, said in May they were discussing Nabli's removal.

But Marzouki's announcement, which came in the midst of his own row with the government over the extradition of Libya's former prime minister, was widely seen as a political manouevre and has been met with silence by senior cabinet members and derision by opposition parliamentarians.

Nabli said that the constituent assembly would hold within days a session to discuss Marzouki's plan to relieve him of his duties at the central bank.

An academic who used to be chief Middle East economist for the World Bank, Nabli was appointed days after last year's revolution sparked upheavals that swept away veteran leaders in Egypt, Libya and Yemen.

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