Reuters International

TUNIS (Reuters) - Tunisia's powerful UGTT union, a joint winner of last year's Nobel Peace Prize, on Friday rejected a call from the country's president to work in a new national unity government to help push through economic reforms.

President Beji Caid Essebsi called on Thursday for political parties, unions and independents to negotiate a new unity government to help advance a reform package and calm social tensions.

The UGTT's refusal will weaken the chances of success of Essebsi's proposal, which aims to include the UGTT and the other trade union, UTICA, as a way to avoid strikes over austerity measures and to push through reforms to revive the economy.

"Our policy in the UGTT is to not participate in any government. We will not join in the unity government but we support this proposal," Hussein Abassi, the head of UGTT, told reporters after a meeting with the parliament speaker.

Essebsi announced the proposed unity government on Thursday, but said such a government would make no sense without the UGTT and the UTICA.

Essebsi's call came as Tunisia's current ruling coalition is struggling to create more growth and jobs after a series of militant attacks battered the North African state's tourism industry and economy.

Any talks to form a new government will need to include the resignation of the cabinet and a parliamentary vote.

It would also take time to work out a consensus among secular, Islamist and left-wing parties and the UGTT, which has played power broker in politics in the past.

Tunisia has emerged as a political model for democratic change in the Arab world since its 2011 uprising against strongman Zine El-Abidine Ben Ali.

But economic reforms demanded by its lenders to tackle high unemployment and frustration among its young have lagged behind the political progress the country has made.

(Reporting by Tarek Amara; editing by Patrick Markey and Tom Heneghan)

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