Key Takeaways
- Germany has reaffirmed its strong support for the US-led peace plan for Gaza, with Chancellor Friedrich Merz emphasizing the critical need for the successful transition to the second phase, which includes the disarmament of Hamas and the deployment of an international peacekeeping force.
- Tunisia's powerful General Federation of Labor (UGTT) has declared a nationwide general strike for January 21, 2026, in protest against the government's perceived "sabotage of social dialogue" and its unilateral imposition of an "unacceptable" wage increase in the 2026 draft budget.
- The impending Tunisian strike underscores a deepening political and economic crisis in the country, characterized by a "stalemate," "economic deterioration," and accusations of establishing a "system of despotism" under President Kais Saied.
- Tunisia faces significant fiscal challenges, including stalled negotiations with the International Monetary Fund (IMF) and increasing reliance on domestic borrowing, with the IMF projecting modest economic growth of 2.5% in 2025 and an inflation rate of 5.9% for the same year.
German Diplomacy Focuses on Gaza Peace Plan's Second Phase
German Chancellor Friedrich Merz has underscored the crucial importance of advancing the US-led peace plan for Gaza, particularly the transition to its second phase. In a recent phone call with Palestinian President Mahmoud Abbas, Merz reiterated Germany's support for the initiative, which was unveiled by US President Donald Trump on September 29, 2025, and subsequently signed on October 9, 2025. The peace plan outlines an immediate ceasefire, the return of all hostages, the demilitarization of the Gaza Strip, and the establishment of an international stabilization force.
Discussions between Chancellor Merz and President Abbas focused on stabilizing the existing ceasefire, which has been in place for nearly two months, and pushing forward with the subsequent stages of the peace process. The second phase specifically calls for the disarmament of Hamas and the deployment of an international peacekeeping force in the region. Merz urged the Palestinian Authority to implement necessary reforms to ensure it can play a constructive role in a post-war order, consistently advocating for a negotiated two-state solution to ensure long-term security for both Israelis and Palestinians. President Abbas affirmed the Palestinian Authority's commitment to a comprehensive reform program and the holding of elections.
Financial aid to the Palestinian Authority remains a contentious issue, with Germany and the European Union linking future assistance to the implementation of these critical reforms. Earlier in February 2025, German Foreign Minister Annalena Baerbock had also emphasized the urgency of progressing to the second phase of the ceasefire agreement, highlighting the ongoing risks to captive lives, including German citizens.
Tunisia Faces Imminent General Strike Amid Deepening Crisis
In a significant escalation of tensions, Tunisia's powerful General Federation of Labor (UGTT) has announced a nationwide general strike scheduled for January 21, 2026. The union, representing a million members, declared the strike in response to what it describes as the authorities' "sabotage of social dialogue" and the government's unilateral actions regarding workers' rights and wages.
The UGTT's Assistant Secretary-General, Sami Tahri, highlighted the union's frustration, stating that over 17 letters sent to successive governments since the Najla Bouden administration have gone unanswered, signaling the government's "absolute rejection of dialogue" and a tendency towards escalation. Key grievances include restrictions on union rights, the government's refusal to engage in collective bargaining, and an "unacceptable and unprecedented" wage increase proposed in the 2026 draft budget law for both public and private sectors.
The union's leadership has painted a bleak picture of the country's current state, asserting that Tunisia is experiencing a "political and social stalemate, economic deterioration, and the establishment of a system of despotism." This sentiment reflects broader public discontent and growing frustration with President Kais Saied's government, which has been accused of consolidating power and adopting an increasingly authoritarian approach since July 2021.
The planned strike is expected to severely disrupt vital sectors across the country, intensifying pressure on President Saied's administration, which is already grappling with significant economic difficulties and stalled negotiations with the International Monetary Fund (IMF). The IMF's latest projections indicate that Tunisia's economic growth is expected to be 2.5% in 2025 and 2.1% in 2026, with inflation rates estimated at 5.9% in 2025 and 6.1% in 2026. The nation's financial stability is further jeopardized by increasing reliance on domestic borrowing and difficulties in mobilizing external resources.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.