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More than half a million Tunisians hold public sector strike over wages

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More than half a million Tunisians hold public sector strike over wages

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By Tarek Amara

(Reuters) - About 650,000 Tunisians went on strike on Thursday to protest the government's refusal to raise wages amid threats from international lenders to stop financing Tunisia's tattered economy.

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Schools, universities, municipalities and ministries were shut and hospitals were on emergency staffing only in the nationwide walkout organised by the UGTT union, the biggest strike action in Tunisia in five years.

Tunisia's economy has been in turmoil since autocrat Zine al-Abidine Ben Ali was toppled in a 2011 uprising sparked by anger at unemployment and poverty.

Earlier this month the International Monetary Fund (IMF) warned Tunisia to keep its public sector wage bill - one of the world's highest in proportion to GDP, according to the IMF - under control to avoid severe debt problems.

"The situation is very dangerous in light of growing inflation and low standard of living.. the government will see soon a revolution of hungry and empty bellies," said Nourredine Taboubi, the head of the UGTT.

He said negotiations had failed because "the sovereign decision is not in the hands of the government, but of the IMF."

Tunisia struck a deal struck with the IMF in December 2016 for a loan programme worth around $2.8 billion to overhaul its ailing economy with steps to cut chronic deficits and trim bloated public services, but progress has been slow.

The IMF stepped up pressure on the government after it agreed to raise wages of about 150,000 employees of state companies last month in a deal with the UGTT which agreed to call off a threatened strike in return.

The government aims to cut the public sector wage bill to 12.5 percent of GDP in 2020 from the current 15.5 percent.

Prime Minister Youssef Chahed also faces a political crisis over his government's failure to solve Tunisia's economic woes.

"If Chahed was looking for populism or electoral interests, he would have signed the wage increase, but we want to know who will finance salaries increases" said the government spokesman Iyad Dahmani.

He added that the international lenders including the IMF had threatened to stop financing Tunisia in the absence of the reforms.

Public sector wages have doubled to about 16 billion dinars ($5.48 billion) in 2018 from 7.6 billion dinars in 2010, officials say.

($1 = 2.9195 Tunisian dinars)

(Reporting By Tarek Amara; Editing by Raissa Kasolowsky)

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