The World Bank has suspended talks over its future engagement with Tunisia following President Kais Saied's recent criticism of sub-Saharan migrants.
The outgoing head of the bank, David Malpass, says Mr Saied's remarks had triggered racially motivated harassment and even violence in Tunisia.
He described the situation as deeply concerning but added that recent steps by the Tunisian government to support migrants were positive.
President Saied denounced racism, despite making comments last month that African immigrants were part of a plot to change Tunisia's demographic profile.