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Business Wire
4 days ago
- Business
- Business Wire
AM Best Revises Outlooks to Stable for Société Tunisienne de Réassurance
LONDON--(BUSINESS WIRE)-- AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of B (Fair) and the Long-Term Issuer Credit Rating of 'bb' (Fair) of Société Tunisienne de Réassurance (Tunis Re) (Tunisia). The Credit Ratings (ratings) reflect Tunis Re's balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management (ERM). The revision of the outlooks to stable from negative reflects AM Best's expectation that Tunis Re's rating fundamentals will remain resilient against the backdrop of the elevated economic, political and financial system risks prevailing in Tunisia. Tunis Re's balance sheet strength is underpinned by its risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio (BCAR), which was at the strongest level at year-end 2024. AM Best expects the company's risk-adjusted capitalisation to remain at the strongest level, supported by good organic capital generation, despite a relatively onerous dividend policy. The assessment factors in Tunis Re's conservative investment portfolio by asset class, and its concentration in Tunisia, where the company holds over 95% of its invested assets in line with regulatory requirements, which weighs on asset quality. Tunis Re has a track record of adequate operating performance, illustrated by a five-year (2020-2024) weighted average return-on-equity ratio of 8.2%. The company's earnings are derived largely from solid investment income, with a five-year weighted average net investment return (including gains/losses) of 7.8%. Tunis Re's underwriting performance is sound, underpinned by technical profits from its non-life portfolio, which translated into a five-year weighted average combined ratio of 96.0% (as calculated by AM Best). A partially offsetting rating factor is the potential volatility that foreign exchange gains and losses can introduce to Tunis Re's operating performance, as reported in recent years. Tunis Re's business profile assessment reflects its leading position in Tunisia and its good diversification into regional markets, with approximately 60% of gross written premium (GWP) generated outside Tunisia. Nonetheless, with GWP of TND 241 million (USD 76 million) in 2024, Tunis Re's scale remains limited in the global reinsurance market, which could hamper its ability to grow in a profitable manner due to competitive pressures. AM Best assesses Tunis Re's ERM as marginal, reflective of the high-risk operating environment in Tunisia, and the adverse impact it has on the company's risk profile. This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.
African Manager
11-06-2025
- Business
- African Manager
Tunisia: Expat remittances exceed one billion dollars by end of May
Remittances from Tunisians living abroad totaled TND 3,243 million, compared to TND 2,993 millionduring the same period in 2023. Expressed in dollars, these funds equalled 1 billion dollars (based on the average monthly exchange rate of 1 dollar = 3.050 dinars at the end of May). It should be noted that remittances from the Tunisian diaspora showed remarkable resilience in 2024, reaching 8.128 million dinars (equivalent to 2.6 billion dollars).
African Manager
09-06-2025
- Business
- African Manager
Check reform: major changes for slow-rolling benefits
Tunisia's check system reform has significantly altered payment behaviors, impacting consumption and inflation. The changes came after repeated complaints from SMEs about unpaid checks, as highlighted by Yassine Gouiaa, then-head of the National Organization of Entrepreneurs, in October 2021. By November 2021, Sofiane Gabsi, Secretary-General of the National Association of Small and Medium Enterprises (ANPME), even called for abolishing prison sentences for SME owners in cases of 'bounced checks.' In February 2025, a new law overhauling Tunisia's check system took effect, disrupting financial and economic norms long accustomed to checks as a primary payment and business tool. Spearheaded by the presidency, the reform introduced new rules, some still unenforceable and practices that clashed with both entrepreneurial culture and existing infrastructure. Overall, the reform was not implemented smoothly, as it is still being discussed and there is no consensus on its consequences. Firstly, the amount of circulating banknotes and cash reached nearly 25 billion Tunisian dinars in June, while the check law aimed to boost the digitization of local commercial transactions. By 28 May 2025, the value of circulating banknotes and coins had risen by 3 billion Tunisian dinars compared to the same period in 2024. This was officially attributed to the Eid al-Adha festivities, despite the fact that purchases, particularly of sheep, had not yet begun, given that prices had already skyrocketed to unprecedented heights. 72% of checks were used as collateral before reform and 74% of people reported difficulties afterwards Before the reform, 72% of checks were used for deferred payment or as collateral. One-third of consumers consider checks to be a means of deferred payment. Even among those with incomes above TND 5,000, 66% use them for installment payments. The IACE study, based on a survey, asserts that 47% of respondents encountered payment difficulties after the reform. 29% of respondents either gave up or postponed a purchase, often exceeding TND 1,500 D. The reform has had a particularly significant impact on the middle classes (earning TND 1,000–TND 3,000). According to INS data, the survey results indicate a decline in consumer purchasing intentions, particularly for goods sensitive to the use of checks. This could partly explain the 0.87% decline in the added value of the trade sector between Q4 2024 (2,857 MD) and Q1 2025 (2,832 MD). 'If you have cash, everything is free!' According to the IACE survey, the preferred payment methods of Tunisians after the new regulations came into force are cash (47%), followed by bank transfers and bills of exchange (16% each). Only 7% of respondents use the new check. Direct debit is almost non-existent (0.4%), despite being available at Tunisian banks, particularly for housing loans and loans for civil servants. According to the IACE survey results, 29% of consumers have given up on purchases, affecting essential goods. 78% of postponed purchases exceed TND 1,500, indicating a significant economic impact. This decline in purchase intent could explain the 0.87% decrease in the added value of the commerce sector. Looking ahead, 58% of respondents prefer mobile payments. 34% want deferred debit cards. Only 2% want to return to the old check system. Meriem Ben Nasser offers another perspective on the future, asserting that there are a few quick and effective alternatives to checks. In a LinkedIn post, she mentions BNPL (Buy Now, Pay Later), a digital solution integrated into the point of sale which enables customers to purchase items on credit with just a few clicks, without any paperwork. Other alternatives include instant digital microcredit backed by simplified scoring via mobile or payment history, pre-authorized payment cards with integrated payment facilities and mobile split payments via QR code. According to the expert, it is urgent that retailers and consumers are trained, the user experience is simplified, and local, inclusive and interoperable solutions are created. IACE conclusion: The law on checks needs to be reviewed. A survey conducted by the IACE one month after the new check regulations came into force reveals a rapid but mixed transition in payment habits. While the majority of consumers seem to be adapting by using alternative solutions, some members of the population are struggling to adapt, showing signs of temporary economic disengagement and indicating a risk of financial exclusion. In this context, it is essential to review the regulations governing alternative means of payment, taking into account technological developments and international standards. For instance, the European Union has enacted legislation that makes immediate transfers mandatory at the same cost as standard transfers. This system offers a reliable and modern alternative to cash or check payments. It is crucial to emphasize that any reform must be accompanied by digital inclusion measures, targeted educational campaigns, and appropriate transitional arrangements, in order to ensure equitable adoption and prevent vulnerable groups from being excluded. Furthermore, changes in usage must be continuously monitored in order to assess the medium- and long-term effects of this regulatory transformation on the economy and society. *Analysis note from the Arab Institute of Business Managers (IACE).
African Manager
23-05-2025
- Business
- African Manager
Tunisia: Olive Oil exports rise while revenue falls by 28.9%
The Tunisian olive oil export receipts during the first six months of the 2024/25 campaign (November 2024 – April 2025) dropped by 28.9% to 2,442.4 million dinars (MD) compared to the same period of the previous campaign, according to data published on Wednesday by ONAGRI. Only 17.7% of revenue comes from exports of packaged olive oil. The average price of olive oil in April 2025 fell by 48.9% compared to the same month in the previous campaign, ranging from 7.1 to TND 18/kg depending on the category. The European market (EU) accounts for the largest share of exports, at 59.5%, followed by North America (24.9%) and Africa (9.6%). Quantities exported from the start of the campaign to the end of April 2025 reached 180.2 thousand tons, marking a 40.1% increase compared to the same period of the previous campaign. Packaged olive oil represented only 11.9% of the exported quantities, with the rest being exported in bulk (88.1%). The extra virgin category alone accounted for 82.5% of the total volume exported. Italy is the leading importer of Tunisian olive oil, accounting for 29% of exports during the first six months of the 2024/25 campaign. Spain and the United States follow with 26% and 19.6% respectively. Regarding organic olive oil, exports reached 34.3 thousand tons, valued at around 469.1 MD, by the end of April 2025. However, the proportion of packaged organic olive oil did not exceed 5% of the total exported organic olive oil. The average price of organic olive oil is TND 13.68/kg, ranging from TND 13.47/kg for bulk oil to TND 17.65/kg for packaged oil. Tunisian organic olive oil is mainly exported to Italy, accounting for 58% of exports, followed by Spain (21%) and the United States (11%).
African Manager
10-05-2025
- Business
- African Manager
Tunisia: Energy trade deficit narrows by 3% in Q1 2025
Tunisia's energy trade deficit, including Algerian gas export royalties, decreased by 3% year-on-year to 2,937 million dinars (MD by the end of March 2025, according to a report by the National Energy and Mines Observatory. Energy exports fell by 28% in value and energy imports dropped by 88% in value. The Observatory highlighted that energy trade fluctuations are highly sensitive to three factors, namely trade volumes, USD/TND exchange rates and Brent crude prices (the benchmark for imported/exported crude and petroleum products) Brent crude averaged $13/barrel lower in March 2025 compared to March 2024. The Tunisian dinar appreciated by 2% against the US dollar (the primary currency for energy trade) year-on-year.
