THE
INTRODUCTION TO THE ECONOMY OF TUNISIA CONSIDERING EVENTS OF EARLY 2011
KHALED BOUKER, MARCH 2011
Economy of Tunisia:
GDP growth rate (%) Tunisia has a diverse economy, ranging from agriculture, mining, manufacturing, and petroleum products, to tourism. In 2008 it had a GDP of $41 billion (official exchange rates), or $82 billion (purchasing power parity).It also has one of Africa and the Middle East's highest per-capita GDPs (PPP).The agricultural sector stands for 11.6% of the GDP, industry 25.7%, and services 62.8%. The industrial sector is mainly made up of clothing and footwear manufacturing, production of car parts, and electric machinery. Although Tunisia managed an average 5% growth over the last decade it continues to suffer from a high unemployment especially among youth.
Tunisia was in 2009 ranked the most competitive economy in Africa and the 40th in the world by the World Economic Forum. Tunisia has managed to attract many international companies such as Airbus and Hewlett-Packard.
Central Bank of Tunisia Tourism accounted for 7% of GDP and 370,000 jobs in 2009.
The European Union remains Tunisia's first trading partner, currently accounting for 72.5% of Tunisian imports and 75% of Tunisian exports. Tunisia is a one of the European Union’s most established trading partners in the Mediterranean region and ranks as the EU’s 30th largest trading partner. Tunisia was the first Mediterranean country to sign an Association Agreement with the European Union, in July 1995, although even before the date of entry came into force, Tunisia started dismantling tariffs on bilateral EU trade. Tunisia finalized the tariffs dismantling for industrial products in 2008 and therefore was the first Mediterranean country to enter in a free trade area with EU.
Tunisia also attracted large Persian Gulf investments (especially from United Arab Emirates) the largest include:
Mediterranean gate: a US$ 25 billion project to build a new city in the south of Tunis.
Tunis Sport City: an entire sports city currently being constructed in Tunis, Tunisia. The city that will consist of apartment buildings as well as several sports facilities will be built by the Bukhatir Group at a cost of $5 Billion.
Tunis Financial harbor: will deliver North Africa’s first offshore financial centre at Tunis Bay in a project with an end development value of US$ 3 billion.
Tunis Telecom City: A US$ 3 billion project to create an IT hub in Tunis.
What Happened Briefly in December2010/January2011 (Tunisians Revolution of Dignity)
The Tunisian Revolution is an intensive campaign of civil resistance, including a series of street demonstrations taking place in Tunisia. The events began in December 2010 and led to the ousting of longtime President Zine El Abidine Ben Ali in January 2011. Street demonstrations and other unrest have continued to the present day.
The demonstrations were precipitated by high unemployment, food inflation, corruption, a lack of freedom of speech and other political freedoms and poor living conditions. The protests constituted the most dramatic wave of social and political unrest in Tunisia in three decades and have resulted in scores of deaths and injuries, most of which were the result of action by police and security forces against demonstrators. The protests were sparked by the self-immolation of Mohamed Bouazizi on 17 December and led to the ousting of President Zine El Abidine Ben Ali 28 days later on 14 January 2011, when he officially resigned after fleeing to Saudi Arabia, ending 23 years in power. Labour unions were said to be an integral part of the protests. The protests inspired similar actions throughout the Arab world; the Egyptian revolution began after the events in Tunisia and also led to the ousting of Egypt's longtime president Hosni Mubarak; furthermore, protests have also taken place in Algeria, Yemen, Libya, Jordan, Bahrain, Iraq, Mauritania ,Pakistan and elsewhere in the wider Middle East and North Africa.
Following Ben Ali's departure, a state of emergency was declared. A caretaker coalition government was also created, including members of Ben Ali's party, the Constitutional Democratic Rally (RCD), in key ministries, while including other opposition figures in other ministries, with elections to take place within 60 days. However, five newly appointed non-RCD ministers resigned almost immediately, and daily street protests in Tunis and other towns around Tunisia continued, demanding that the new government have no RCD members and that the RCD itself be disbanded. On 27 January Prime Minister Mohamed Ghannouchi reshuffled the government, removing all former RCD members other than himself. On 6 February the new interior minister suspended all party activities of the RCD, citing security reasons.
Following further public protests, Ghannouchi himself resigned on 27 February, and Beji Caid el Sebsi became Prime Minister; two other members of the Interim Government resigned on the following day.
Source : http://en.wikipedia.org/wiki/Tunisian_Revolution
To read the analysis scroll through this site. To learn more about the background policies, click here Introduction and Policy Recommendations
To learn more about MIEPA, click here Return to MIEPA's Home Page
The study is by Khaled Bouker, a Tunisian native who currently [April 2011] lives in San Francisco; this study presents the Tunisian government's economic policies as compared to the MIEPA list of policies as outlined above. The ratings herein are based on the following rating scale:
RATING SCALE
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2005. Used herein with permission]
To read a disclaimer about the analysis in this file, scroll to the bottom of the file.
Tunisia - Khaled Bouker
TUNISIA: ECONOMIC POLICY ANALYSIS BASED ON MIEPA POLICY LIST
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 0.5 1.5 15.0 10 %
2 4.0 13.5 15.0 90
3 4.5 13.5 15.0 90
4 4.0 12.0 15.0 80
5 4.3 12.9 15.0 86
6 3.9 11.7 15.0 78
7 0.8 2.4 15.0 16
8 3.6 10.8 15.0 72
9 1.0 3.0 15.0 20
10 4.0 12.0 15.0 80
11 4.0 12.0 15.0 80
12 1.8 3.6 10.0 36
13 4.0 8.0 10.0 80
14 3.0 6.0 10.0 60
15 4.0 8.0 10.0 80
16 0.5 1.0 10.0 10
17 4.5 9.0 10.0 90
18 3.5 7.0 10.0 70
19 4.5 9.0 10.0 90
20 3.0 6.0 10.0 60
21 1.0 2.0 10.0 20
22 1.0 2.0 10.0 20
23 4.0 8.0 10.0 80
24 1.0 2.0 10.0 20
25 2.5 5.0 10.0 50
26 3.5 7.0 10.0 70
27 4.0 8.0 10.0 80
28 4.0 8.0 10.0 80
29 1.5 1.5 5.0 30
30 3.0 3.0 5.0 60
31 1.0 1.0 5.0 20
32 1.0 1.0 5.0 20
33 1.0 1.0 5.0 20
34 1.5 1.5 5.0 30
TOTAL 93.4 213.9 375.0 57.0%
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TUNISIA:
INDIVIDUAL POLICIES
1.Freedom from internal control: 0.5
Ben Ali’s hold on government institutions remained strong, and he won a fifth five-year term in the October 2009 presidential election, taking nearly 90 percent of the vote amid tight media and candidacy restrictions. In the concurrent elections for the Chamber of Deputies, the lower house of the legislature, the ruling Democratic Constitutional Rally (RCD) captured 161 of 214 seats. Of the six other parties that won representation, none took more than 16 seats. The Progressive Democratic Party (PDP), one of the few critical independent parties, boycotted the 2009 election after it was barred from campaigning, meaning only three candidates qualified to challenge the incumbent.
The government’s efforts to control the 2009 election process were evident in restrictions imposed on the media, retaliation against journalists and bloggers, and a concerted bid by official media to discredit critical coverage. Although this was the first Tunisian election in which all presidential candidates were given airtime to discuss their platforms, the authorities manipulated the scheduling and edited the speeches. The RCD monopolized prime-time advertising and campaigning, while independent journalists and commentators were arrested or assaulted, and their publications, broadcast outlets, and even blogs and web pages were blocked.
Some political prisoners have been freed in recent years, and Ben Ali has stated that the press and opposition should feel free to promote their ideas. However, the president’s critics still face beatings and incarceration, and even political activists who are released from jail often have their movements monitored and restricted.
Political Rights and Civil Liberties
Tunisia is not an electoral democracy. President Zine El Abidine Ben Ali has exercised authoritarian rule since seizing power in a coup in 1987.
Source: http://www.africa.com/tunisia/report
2 - Freedom of Speech: 0.5
* During Ben Ali Era : (from 11-07/1987 to 01-14/2011)
The Tunisian government does not like the idea of a free press , Tunisia has one of the worst media environments in the Arab world. Despite constitutional guarantees and a press law that promise freedom of expression, the government uses an array of legal, penal, and economic measures to silence dissenting voices. Libel and defamation are criminal offenses, and journalists also risk punishment under laws against disturbing public order. Only a handful of private television and radio stations have received licenses, including one owned by the president’s son-in-law that was launched in 2009. Government-approved media regularly feature praise of Ben Ali and his associates, and criticism of the president is not tolerated.
Tunisian journalists in 2009 were detained, physically assaulted, fired from their jobs, prevented from leaving the country, and subjected to seemingly arbitrary police surveillance. More than 100 Tunisian journalists live in exile, according to Canadian Journalists for Free Expression. The authorities monitor foreign media, denying accreditation to critical journalists, and foreign publications or reporters can be seized or expelled if they offend the government. Ahead of the 2009 elections, the Qatar-based satellite television station Al-Jazeera was the target of a smear campaign, and its Tunisia-based correspondent was denied accreditation.
Stations that operate without approval via satellite or internet broadcasts face severe repression. For example, in January 2009 the authorities shut down the independent radio station Kalima soon after it began broadcasting via satellite, arresting or detaining several of its employees and confiscating materials from its offices. In February, three journalists for the London-based satellite television station Al-Hiwar al-Tounissi were arrested and charged with working for an “illegal station,” according to the Observatories for freedom of Press , the government bans access to an array of internet sites dealing with topics like democracy and human rights, and opposition media websites are often defaced. Social-networking and video-sharing sites like Facebook and YouTube were intermittently blocked during 2009. Online journalists and bloggers are routinely monitored, harassed, and arrested. The Committee to Protect Journalists has ranked Tunisia among the 10 worst places to be a blogger.
Source : http://www.africa.com/tunisia/report
* After the revolution of (01-14/2011): (4.5)
A month after Tunisians toppled their authoritarian president, sending shock waves across the Arab world, many are discovering that may have been the easy part.
With restrictions on the media lifted and freedom of speech flourishing, the cork has popped on years of bottled-up demands over salaries, working conditions and other grievances. Tunisians seem torn between a desire to fully eradicate the remnants of the previous government and a pining for stability.
Source : http://www.nytimes.com/2011/02/14/world/africa/14tunisia.html
3 – Effective Fair Police Force : (4.5)
Tunisia was one of the most effective police states in a region of authoritarian and undemocratic rulers, it also boasts many characteristics that do not apply elsewhere. Tunisia has a strong, educated, and modern middle class – those young men and women who were on the streets and the front lines in Tunis – which nations like Algeria, Egypt, and Yemen don’t have.
Source : http://www.csmonitor.com/World/Middle-East/2011/0118/Tunisian-events-likely-to-spark-wider-Arab-reforms-but-not-revolutions
4 – Currency : (4.0)
* 1 Tunisian Dinar = 1000 Millimes
* 1 Tunisian Dinar = 1.3838 U.S Dollar
The Tunisian currency is in a state of "controlled floating" towards other currencies. There is meanwhile an official interbank exchange rate (not a fixed rate determined by the central bank), but the import and export of the currency is still strictly forbidden. The ownership and ability of exchange of foreign currencies are strictly regulated for the citizens of Tunisia.
Citizens of other countries may exchange an unlimited amount of money into the Dinar, but the reverse is strictly limited and only allowed in small (previously declared and exchanged) amounts. It has been announced that the Tunisian Dinar will become a freely convertible currency by the year 2014.
Source : http://www.tunispro.net/tunisia/currency-in-tunisia.htm
5- Commercial Banks : (4.3)
There is no clear-cut distinction between commercial and merchant banks in Tunisia. By and large, all commercial banks provide commercial and saving services, with merchant banking as an accessory service. The commercial banks in Tunisia are:
Arab Tunisian Bank (ATB)
Banque Franco Tunisienne (BFT)
Banque Nationale Agricole (BNA)
Attijari Bank /Banque de Tunisie (BT) Amen Bank (AB) /Banque Internationale Arabe de Tunisie (BIAT)
Société Tunisienne de Banque (STB)
Union de Bancaire pour le Commerce et l’Industrie (UBCI)
Union Internationale de Banques (UIB)
Banque de l'Habitat (BH)
Citibank
Banque Tunisienne de Solidarite (BTS)
Arab Banking Corporation (ABC)
Tunisian Qatari Bank (TQB)
Banque de Tunisie et des Emirats (BTE)
Banque Tuniso-Koweitienne (BTK)
Banque de Financement des Petites et Moyennes/Enterprises (BFPME)
Banque Tuniso-Libyenne (BTL)
Stusid Bank (STUSID)
Banque Zitouna (ZITOUNA)
Tunisian banks offer a broad range of regular banking services, including depository services and trade and credit services. Several banks now offer electronic banking services for corporate clients and a wide array of consumer banking facilities such as credit cards, ATMs and telephone banking services. Most banks are linked to the SWIFT global payment system, enabling them to quickly execute foreign currency and convertible Tunisian Dinar transactions to non-residents, including transactions involving the repatriation of earnings of foreign companies. Tunisian banks, however, are still not in the position of offering a complete spectrum of modern services in terms of foreign exchange, money and capital markets and corporate finance activities. In order to ameliorate this situation, the Tunisian monetary authorities are working on regulatory changes which would promote additional modernization of the industry.
Source : http://en.wikipedia.org/wiki/List_of_banks_in_Tunisia
6- Communication Systems : (3.9)
Tunisia has a large number of young graduates with skills and qualifications in various branches that meet the needs of businesses. In 2008 there were more than 9,500 graduates holding degrees in computer sciences and communications, compared to 1,769 in 2002. Communication technologies is a priority sector in Tunisia. It is one of the most dynamic sectors, with one of the highest growth rates (15% in 2009). It has undergone notable expansion currently contributing for 10% to the GDP as against only 2.5% in 2002 and by 9% to job creation across the entire country.
It has benefited from the high level of investment, amounting to some billion dinars over the period 2007-2011 vs. just 430 million dinars over the period 1992-1996. Such strong growth is attributable to better infrastructure, especially telecommunications infrastructure, involving active and motivated participation by private companies operating in this field.
Tunisia has a communications technology complex, El Ghazala, located in the nearby suburbs of Tunis. Its very modern infrastructure meets the needs of companies in specialized new information and communication technology sectors. This complex presents an innovative environment based on creative intelligence and high technology. It has also helped in creating synergy between education, research and industry. Extension works are in progress to provide this city of 100,000 m² with additional outfitted areas.
Source : http://www.investintunisia.tn/document/516.pdf
7- Transportation : (0.8)
Tunisia has a number of international airports to service its sizable tourist trade. Tunis is the center of the transport system as the largest city having the largest port and a light transit system .Tunis is the most significant port in Tunisia with other significant ports on the Mediterranean Sea including Bizerte, Gabès, La Goulette, Sfax, Sousse and Zarzis. Tunisia's merchant marine consisted of 14 ships as at 2002
Tunisia inherited much of its rail transport system from the French and the Tunisian Government has developed infrastructure further. The railways are operated by the Société Nationale de Chemins de Fer Tunisiens (SNCFT), the Tunisian national railway. A modernization program is currently underway. It has a total of 2,152 km consisting of 468 km of 1,435 mm (4 ft 8 1?2 in) standard gauge rail ways and 1,674 kilometers of 1,000 mm (3 ft 3 3?8 in) meter gauge. Tunis has a light rail system. In the south of Tunisia, there is a narrow gauge railway called the Sfax-Gafsa Railway which delivers phosphates and iron ore to the harbor at Sfax. Tunisia has rail links with the neighbouring country of Algeria via the Ghardimaou-Souk Ahras line, and another connection to Tébessa, however, the latter link is currently not used. There are no railways yet in neighboring Libya though some are under construction in 2008; some gauge conversion would be required for efficient connections.
Source : http://en.wikipedia.org/wiki/Transport_in_Tunisia
8 - Education : (3.6)
The academic year runs from October to June and examinations are held in late June or early July. The official language of instruction at the school level is Arabic; French and English are introduced as a foreign language in the third year of school studies. Students are tested at the end of each trimester in all subjects through oral, written and practical.
Tunisia invests heavily in education, which accounted for 21% of public expenditure and 6.4% of GDP in 2005. This policy has had a direct positive impact on the illiteracy rate among the Tunisian population, which decreased from 68% during the 1960s to 21% in 2005 . In recent years, with the support of EU funds, the government has engaged in technical and vocational education reforms. However, the VET sector still faces many challenges. Despite impressive achievements in education and training, equal access is still an issue. In 2003, Tunisian secondary enrolments in rural areas were as low as 19%, compared to 78% in Tunis. The repetition rate is about 16% in primary school and 16% in secondary school. With large-scale donor funded programs (such as Mise à Niveau de la Formation Professionelle et de l’Emploi : MANFORME) to strengthen the links between vocational training and employment, progress has been made but the results need to be mainstreamed into the entire system. The main reforms in general education relate to raising the quality of education (the training of trainers, decentralization and program reforms based on competency approaches), generalizing the use of ICT, diversifying the training offer by introducing new technological fields, and reducing school drop-out rates, especially in rural areas. However, higher education remains the most important priority. The main objectives are to: raise the capacity to respond to rapidly increasing demand for higher education; raise the volume of post-secondary technical education; enhance quality and respond to industry’s skills needs.
Source : http://www.etf.europa.eu/pubmgmt.nsf/(getAttachment)/5CD26BB43A026CD8C12573DB004D8AD2/$File/NOTE7B7KG6.pdf
Source : http://en.wikipedia.org/wiki/Education_in_Tunisia
9 - Social Mobility : (1.0)
Population
10,629,186 (July 2011 est.)
Age structure
0-14 years: 23.2% (male 1,274,348/female 1,193,131)
15-64 years: 69.3% (male 3,638,014/female 3,728,294)
65 years and over: 7.5% (male 390,055/female 405,344) (2011 est.)
Median age
total: 30 years
male: 29.6 years
female: 30.4 years (2011 est.)
Population growth rate 0.978% (2011 est.)
Source : http://www.indexmundi.com/tunisia/demographics_profile.html
10 – Freedom from outside control : (4.0)
Tunisia citizen are subject to obey the national law, but could never be arrested by a foreign task force unless the approval of the Tunisian government.(since Tunisia belongs to many organization like Interpol)
Source : Personal
11 – Foreign Currency Transactions : (4.0)
Foreign exchange controls in Tunisia are regulated by the Foreign Trade and Foreign Exchange Code of 1976. The government has undertaken a review of the Code and is in the process of instituting liberalization changes. The Tunisian Dinar is not fully convertible to foreign currencies, however, in recent years, Tunisia has relaxed foreign exchange control provisions regarding current account transactions. A currency account transaction law was enacted in 1993 which incorporates liberalizing provisions in this regard. Today the Tunisian Dinar is commercially convertible for all bona fide trade and investment operations. Foreign investors in Tunisian companies are entitled to repatriation capital and may receive dividends in foreign currency.
In the area of importation of goods, all import documents which involve payments must be handled through authorized banks. Foreign currency may be purchased from the Central Bank of Tunisia (CBT) or from banks which have been designated by the CBT for the payment of imports, subject to licensing restrictions and provided that the license has been obtained prior to importation. Payments for exports received in foreign currency ordinarily must be repatriated within ten days of payment. Capital transfers are subject to the approval of the CBT. Non-residents are allowed to repatriate invested capital and net proceeds of such investment in foreign currency.
Source : http://www.infoprod.co.il/country/tunis2c.htm
12 – Border Control : (1.8)
Tunisia gives the country two distinctive Mediterranean coasts, west-east in the north, and north-south in the east. Tunisia is about the size of the American state of Wisconsin. Despite its relatively small size, Tunisia has great environmental diversity due to its north-south extent. Its east-west extent is limited. Differences in Tunisia, like the rest of the Maghreb, are largely north-south environmental differences defined by sharply decreasing rainfall southward from any point. The Dorsal, the eastern extension of the Atlas Mountains, runs across Tunisia in a northeasterly direction from the Algerian border in the west to the Cape Bon peninsula in the east
Tunisia is situated on the Mediterranean coast of North Africa, midway between the Atlantic Ocean and the Nile Delta. It is bordered by Algeria on the west and Libya on the south east .
Source : http://en.wikipedia.org/wiki/Geography_of_Tunisia
13 - Cultural , Language homogeneity : (4.0)
Perhaps because Tunisia is a relatively small and homogeneous country, the sense of national identity is strong. It is constantly maintained by reference to recent national history, particularly the struggle against French colonialism (1881–1956) and the subsequent efforts to create a modern society. The struggle was more political and tactical than violent, though there were some violent outbursts. This narrative is constantly rehearsed, in the sequence of public holidays, in the names of streets, and in the subject matter of films and television shows. The sense of difference is also reinforced by the achievements of the national football (soccer) team in international competitions. The Tunisian flag did not change during or after the colonial period. The flag has a red star and crescent, symbolizing Islam, in a white circle in a red field. It derives from the Ottoman flag, reflecting Ottoman suzerainty over Tunisia from the sixteenth through the nineteenth centuries
The language of Tunisia is Arabic. As elsewhere, the spoken language differs considerably from the written language. The regional dialects are tending to disappear under pressure from mass media centered in Tunis. The main second language is French. The educational system is geared to produce bilingualism in French and Arabic, with a few elite schools now focusing on English. Only a minority of Tunisians, however, are comfortable in French. Fluency in French is a status marker, and so social considerations, as well as the practical ones of an opening to the world, have impeded full Arabization. Knowledge of other European languages is largely a function of television exposure and tourism.
Source: http://www.everyculture.com/To-Z/Tunisia.html
14 – Political Effectiveness : (3.0)
Tunisia is considered safe from an Islamic fundamentalist take-over. The thirty-one year rule of Tunisian President Habib Bourguiba (1956-87) left the country relatively free of bureaucratic corruption and steered it clear of the same command economy structure that decimated Algeria.
At the same time, the Bourguiba regime also created the underpinnings of a basically secularist society; on one occasion he went so far as to defiantly drink a glass of water during the Muslim fasting month of Ramadan on state-run television.
Today Tunisia is firmly in the hands of another committed secularist, the beneficent authoritarian Ziad Ben Ali, whose rigorously skeptical attitude towards democracy is probably best expressed in the 99 percent of the vote he captured during March 1994 presidential elections. Moderately concerned about the potentially destabilizing effects of home-grown Islamic fundamentalism, he has taken few chances with local activists of the officially banned Islamic Ennadha (Renewal) Party, arresting, converting or exiling them with scant regard to legal niceties. At the same time, he has also expanded on a flourishing social service net (Tunisian medical care and education are arguably the best in the Arab world), and kept the bureaucracy clean. Tunisia’s relations with neighboring Libya appear to be stable. In fact, Libyan leader Muammar Gaddafi began urging Tunisian businessmen to invest in his country in October, 1996. His calls for investments included the agriculture, fisheries, petrochemicals, iron and steel industries.
Source : http://www.infoprod.co.il/country/tunis1a.htm
15 – Institutional Stability : (4.0)
Tunisia ranks from the 2nd to the 4th quintile for the global indices that benchmark its political, economic, business, and human capital climates, as shown below. Tunisia scores relatively well in institutional capacity, education and macroeconomic stability when compared to other countries in the Middle East and North Africa region. The Bertelsmann Transformation Index, however, notes that the democratic transition has largely stalled and Freedom House describes the country as “Not Free.” As measured by the UNDP, Tunisia ranks in the 3rd quintile of the Human Development Report, and is solidly in the category of "medium human development.” Although in the 2nd quintile in the Corruptions Perception Index, Freedom House states that corruption is rampant among some leading political figures. There are also still inefficiencies in the labor market and there is a low level of confidence in the stability of the banking system.
Source : http://www.estandardsforum.org/tunisia/standards
16 – Honest Government : (0.5)
The government of Tunisia has been methodically reducing its role in the economy. By 1994, forty-six of the 189 public enterprises were completely or partially privatized either through sale of shares or assets; most of these forty-six firms, however, were small-scale. Although the privatization program is supported by the National Labor Federation (UGTT), the government is moving carefully to avoid mass firings in unprofitable public companies.
The government is focusing on the stock market as the principal vehicle for the privatization program. Specific targets are companies operating in competitive sectors. TunisAir and other major state-owned companies will be partially or wholly privatized by selling shares through the stock market.
The most dramatic re-orientation has occurred in the financial and banking sectors. The Central Bank is gradually shifting to a supervisory and regulatory role. Interest rates were officially deregulated and commercial banks allowed to move into the long term credit market. The government made the Tunisian Dinar convertible for current account transactions, and currency trading was privatized. In the financial markets, the former state controlled stock exchange, the Bourse, was privatized. The new structure is composed of brokerage houses. Similarly, a privately held central stock clearing house company was established. The state will continue to exercise its supervisory and regulatory role through the Financial Market Council. In 1995, the government restructured its economic ministries. The former Ministry of National Economy was split into the Ministries of Industry and Commerce. The Ministry of Industry is responsible for improving the international competitiveness of Tunisian industry. It also retains control of the majority of state owned industries. The Ministry of Commerce manages consumer subsidy and price control policies. Finally, the Ministry of Economic Development, formerly the Ministry of Planning, is responsible for long-term budget and policy development.
Source : http://www.infoprod.co.il/country/tunis1c.htm
17– Common Law : Before the revolution (1.0) / After the revolution (4.5)
The constitution provides for an independent judiciary. The judiciary is susceptible to being influenced by the executive branch in practice. Magistrates are appointed by the president upon recommendation of the Supreme Council of the Magistracy; its members are drawn from the Department of Justice and the courts of appeal and cassation. In 2003, there were 51 cantonal courts, 23 courts of first instance, and 3 courts of appeal, located in Tunis, Sousse, and Sfax . A Court of Cassation in Tunis has three civil sections and one criminal section; it acts as the ultimate court of appeal. In addition, a High Court is constituted for the sole purpose of prosecuting a member of the government accused of high treason. The Council of State is an administrative tribunal empowered to resolve conflicts between citizens and the state and public authorities; as an accounting department, it is empowered to audit and examine government records.
Civil and criminal law generally follows French-influenced practices that evolved during the period of the protectorate. Since 1956 there has been a steady reform of existing Islamic legislation, including the abolition of polygamy. Shari'ah courts were abolished in 1956.
A military tribunal consisting of a presiding civilian judge from the Court of Cassation and four military judges hears cases involving military personnel as well as cases concerning civilians when national security is deemed to be at stake. Decisions of the military tribunal may be appealed to the Court of Cassation.
Source : http://www.nationsencyclopedia.com/Africa/Tunisia-JUDICIAL-SYSTEM.html#ixzz1HlULsOcv
18– Central Bank : (3.5)
The Central Bank of Tunisia's general assignment is to preserve price stability. In this respect the bank is notably in charge of : Watching over the monetary policy ; Controlling money in circulation and being watchful with respect to sound functioning of systems of payments as well as guaranteeing their soundness, efficiency and security.
Supervising the lending institutions ; Preserving both the stability and security of the financial system.
Source: http://www.bct.gov.tn/bct/siteprod/english/presentation/missions.jsp
19- Domestic Budget Management : (4.5)
The decision of R&I to maintain Tunisia’s rating comes after the assessment mission conducted by a delegation of this agency to Tunisia from June 28 to 30, 2010 and whose supervision was provided by the Central Bank through the organization for this delegation of a series of talks with officials of the ministries of industry and technology, development and international co-operation, employment and vocational integration, finance and tourism as well as officials of banks or public and private companies, in addition to representatives of the diplomatic corps accredited in Tunisia.
The agency particularly stressed Tunisia’s achievement in 2009, though a year of crisis, of a growth rate of 3.1% sustained by domestic demand, the actions taken by monetary authorities to reduce the level of NPL ratio to 13.2% compared with 20% five years ago, adequate growth of economy credits and the “disciplined budget management” adopted by the Tunisian government which helped maintain the budget deficit to an acceptable level of 3% in 2009.
Source : http://www.tunisiaonlinenews.com/ri-confirms-tunisias-sovereign-rating-a-with-stable-outlook/
1 - Value-added tax:
The value-added tax, VAT, is applied to all industrial, handicraft and services businesses except foragriculture.VAT paid on purchases is deductible from the VAT collected on sales turnover.
- 6% Sensitive products of social, medical and educational nature
- 10% Capital goods having no locally-made counterparts and some services industries such as transport and tourism, low voltage power for domestic use and, medium and low voltage power for operating water pumping designed for agriculture irrigation, training services and Internet subscriptions
- 18% Capital goods with locally-made counterparts, raw materials, semi-finished goods and non-food consumer goods
- 29% Luxury products
2 - Taxable earnings
Real estate earnings;
Capital gains and transferable securities; Life annuities; Earnings derived from any paid work; Earnings derived from business operations in Tunisia; Any other earnings made in Tunisia.
-Fiscal Year:
From January 1st every year, income tax is charged on the previous year earnings. Any resident or non resident natural person is charged on earnings made in Tunisia.
- Tax scale:
Applied to net annual earnings:
TND %
Up to 1,500 (0%)
1,501-5,000 (15%)
5,001-10,000 (20%)
10,001-20,000 (25%)
20,001-50,000 (30%)
More than 50,000 (35%)
Source : http://www.tunisia.com/tunisia/business/taxation-system
20 – Government Debt : (3.0)
With its temperate climate, proximity to Europe, socio-political stability, and a fairly skilled labor force, Tunisia enjoys significant comparative advantages. Having opted early on for a market economy and progressive integration in the world economy, the country’s economic policy has succeeded in boosting private sector involvement, diversifying its industrial base, and containing the social cost of structural adjustment, a pre-condition for political and social stability.
-External Debt Per Person In Tunisia : In 2005 $2,000,000
-GDP Annual Growth : In 2005 $30,000.00
In 2007 $35,000.00
-External Debt Total in US $:Between 2002 and 2007 Progression from $15,000.00 in 2002 to $20,000.00 in 2005.Notice a recession after 2005.
-Inflation, GDP Deflator (annual%) :
2006 : 4
2007: 2.4
Source : Personal
- Gross Domestic Product – GDP = US$ 43.863 billion (2010 estimate)
- Real GDP growth :
2008 = 4.5%
2009 = 3.1%
2010 = 3.8%
2011 = 4.8%
GDP per capita – PPP = $9,489 International Dollars (2010 estimate)
Public debt (General government gross debt as a % of GDP) =
2007 = 45.9%
2008 = 43.3%
2009 = 42.8%
2010 = 43%
2011 = 42.8%
Tunisia was the first country (in 1995) to sign the free trade agreement with the European Union in the framework of the Euromed initiative. Between 1992 and 2004, Tunisia’s GDP rose by an average 4.1 percent, reaching a record 5.8 percent in 2004. The 2005 performance was for the most part positive (4.2 percent of GDP), despite tougher international competition and rising oil prices, sustained by favorable growth in service activities such as tourism (6.4 million tourists, TND2.563 million, some 12.5 percent of current revenues), air transport, telecommunications, and new technologies. For 2006, the latest estimates forecast GDP growth of 4.6 percent.
The manufacturing sector, in particular textile/clothing industries, has been the spearhead of Tunisia’s economic development since 1972, stimulated by a policy of foreign investment promotion and exports. 42 percent of overall manufacturing output is exported, thanks in particular to subcontracting activities. Manufacturing industries account for 20 percent of GDP and employ 20.5 percent of the labor force, whereas agriculture and fishing contribute for 14.3 percent of GDP and provide 22 percent of jobs and tourism generates 15.6 percent of GDP. The country counts more than 10,000 industrial companies. A structural adjustment or "upgrading" program has been introduced to improve the competitiveness of the manufacturing sector and related service companies in order to prepare companies for implementation of the free trade zone with the EU. In parallel, a strategy of export promotion was launched to strengthen export capacity at the company level. One component of this strategy is the institution of a documentation called the “single bundle” (liasse unique) for imports and exports. As early as 1989 the Government also set up a legislative framework for privatization. There have been several reforms of the financial system, targeting sounder finances at banks and insurance companies and diversifying the range of financial products available to economic operators.
Thanks to a prudent monetary policy at the Central Bank of Tunisia (BCT), the inflation rate has fallen from 6.3 percent in 1995 to about 2 percent today. The Tunisian Dinar (TD) is convertible for current operations and a foreign exchange market was created recently, the objective being to reach total convertibility of the Dinar over the long term. Tunisia’s total national debt is projected at approximately US$ 16.3 billion for 2005 (57.6 percent of GDP) and its foreign debt is estimated at US$ 15.7 billion (54.9 percent).
As a result of its trade liberalization policy, Tunisia has enjoyed dynamic exports, a narrowing of the trade deficit, and diversification of its export base. In 2005, the volume of trade reached TD 31 billion (EUR19 billion), despite difficult international economic conditions: an end to the multifibre agreement, soaring oil prices, and an economic downturn in Europe. The coverage rate of imports by exports increased from 69.6 percent in 2001 to 79.6 percent in 2005.
Source : http://www.tunisia.com/tunisia/business/taxation-system
21 – Private Property : (1.0)
We at Tunisia.com consider ourselves to be independent and above all to act in the interests of our visitors and the expat community in Tunisia. This ethos is most important when it comes to the property market in Tunisia, in Tunisia the vast majority of information provided by agents/ developers or in articles written by the former so one could be forgiven for feeling that a) you cannot lose buying Tunisian property and b) its as easy as falling off a log....neither scenario is true
Source : personal
22 – Economic Statistics : (1.0)
GDP $95.6 billion PPP (2009 est.)
GDP growth 3% (2009 est.)
GDP per capita $9,100 PPP (2009 est.)
GDP by sector agriculture: 11%; industry: 35.3%; services: 53.7% (2009 est.)
Inflation (CPI) 3.5% (2009 est.)
Population
below poverty line 3.8% (2005 est.)
Gini index 40 (2005 est.)
Labor force 3.74 million (2009 est.)
Labor force by occupation agriculture: 18.3%; industry: 31.9%; services: 49.8% (2009 est.)
Unemployment 13.3% (2009 est.)
Main industries petroleum, mining (particularly phosphate and iron ore), tourism, textiles, footwear, agribusiness, beverages
Source : http://en.wikipedia.org/wiki/Economy_of_Tunisia
23 – Protection of Public Health and Safety : (4.0)
Tunisia Has a developed healthcare system. All public and private healthcare institutions are very strictly monitored by the Ministry of Health and the medical standards are equivalent to anywhere in Europe. In the last few years, Tunisia became a very popular destination for medical holidayers from Europe, who are looking for affordable medical treatment and cheap cosmetic surgery combined with relaxing holidays by Tunisia stunning beaches.
Source : http://www.theflyingpatient.com/tunisia.php
24 – High wages Policies : (1.0)
Employment relations in Tunisia are governed by the Labor Code of 1956. Labor contracts may be for a definite or an indefinite period of time. A definite period contract may specify that it is valid for either a limited period of time or for a specific task. If the parties continue such a contract after the agreed expiration date, then it becomes a contract for an indefinite period.
A labor contract may be terminated by agreement of the contracting parties or as a result of resignation or dismissal of the employee. In the latter case, the employee is entitled to severance pay. The Labor Code sets standards regarding other employment conditions, such as the maximum number of work hours per week, the minimum wage level, overtime work rate and annual leave. Regional labor inspectors are responsible for the enforcement of such regulations. Worker health and safety standards are regulated and enforced by the Social Affairs Ministry Trade unions have played a key role in Tunisia's history since the struggle for independence, when the 1952 assassination of labor leader Farhat Hached was a catalyst for the final push against French domination.
The General Union of Tunisian Workers (UGTT), the country's sole labor confederation, has generally focused on bread-and-butter issues, but at some critical moments in Tunisia's history has played a decisive role in the nation's political life. Despite a drop in union membership from 400,000 to about 250,000 as the structure of the Tunisian economy changed, the UGTT continues to hold a prominent place in Tunisia's political and social life, and negotiates with government and the umbrella employer group on wages and benefits.
Source : http://www.infoprod.co.il/country/tunis.htm
The average yearly income for a typical Tunisian family varies on many things. Do both husband and wife work? Do any of the children work and contribute to income? What part of the country do they live in? Which class system do they fall into? etc.
For an average normal middle class family where both husband and wife work, the yearly income would be between 4,800-12,000TND a year. The variant is that most people make between 200-500TND a month. A friend of my father-in-law makes only 200TND a month, one of my friends makes 350TND a month, and I made 500TND a month when I worked for a short period.
Of course there are a lot of people who make over the average as well.
It depends on what type of job a person has. According to this website: http://siakhenn.tripod.com/capita.html Tunisias Per Capita Income (based on 2004 figures) is US$7,100
Source : http://jamiehassen.multiply.com and http://siakhenn.tripod.com/capita.html
25 – Environmental Protection : (2.5)
Tunisia is a North African country undergoing rapid development. It has a range of environmental problems including soil erosion, desertification, sedimentation and reduction in biological diversity that are partly caused by the climate and compounded by development processes such as industrialization, urbanization and population growth. Consequently, Tunisia is suffering from the inevitable conflicts between environmental protection on the one hand and sustainable development on the other. The background to the development of environmental protection in Tunisia has been reviewed. The potential impact of new environmental legislation and awareness on the environment has been appraised based on observations gathered during field visits in 1996 and 1998. The majority of the field sites have provided positive examples for the Tunisian environmental program.
Source : http://ideas.repec.org/a/wly/sustdv/v7y1999i4p191-203.html
26 – Strong Army : (3.5)
This book [cited below in sources] attempts to offer a panoramic view of the military history of Tunisia, by introducing through its pages some great episodes of the resistance to foreign invasion, when its inhabitants tried to defend themselves and defend their freedom and their aspiration for a national unity. This history takes place within a context of continuous changes inside a geopolitical, economical and cultural environment which gave birth to a modern Tunisian state.
This piece of work does not pretend to present all the events that have scored the Tunisian military history, but would only limit itself to the broad lines.
However, the biggest ambition of this essay is doubtless to enlighten some pages of the history of the Tunisian people who, despite the vicissitudes of time, stayed more than ever attached to his country, ready to sacrifice his life for its defense.
The role of the Tunisian army, shield of the fatherland and defender of the country honor, relies on the noble principles whose roots go back far in history. As present drains from past and supplies the foundations for the future, it seems necessary to recall for memory some great pages of this country history to contemplate some of its glorious moments. We will also see some of its several achievements accomplished to the nation service by the national army since its creation.
This book is published on the occasion of the fortieth anniversary of the Tunisian army creation. This army is legatee of three centuries of heroic feats, and the Tunisian nation will continue to produce capable people to defend in the future, protecting its dignity and reinforcing its invulnerability forever.
Source : http://www.defense.tn/en/index.php? option=com_content&task=view&id=119
27 – Foreign Trade Impact : (4.0)
Over 130 companies have submitted requests to invest in Tunisia's two free trade zones. Sixty companies, of which fifty are foreign, made requests to operate in the Bizerte Harbor Free Trade Zone, located sixty kilometers north of Tunis. Most of these companies are French, but requests have also come from American, German, British, Danish, Belgian, Japanese, Indonesian and Egyptian companies. These foreign companies are seeking to invest in the electronics, metals, pharmaceuticals and food industries.
The second free trade zone, in Zarzis Harbor, is 450 kilometers south of Tunis, near the Libyan border. Over seventy foreign companies have already submitted requests to invest in this zone, most of them French. The Zarzis zone spans over 380,000 square meters. Twenty million dollars have been invested to establish this zone, part of which will be utilized to expand the harbor facilities at Zarzis. The harbor is currently used to import oil from Libya, among other activities.
A foreign company may establish and register a branch in Tunisia by obtaining a Merchant Card from the Ministry of Trade. The process for obtaining a Merchant Card and registering in
Tunisia is significantly easier for foreign companies which have engaged in a contractual relationship with a Tunisian company. A copy of the contract with the Tunisian company, the incorporation documents of the foreign company and all records and board decisions of the foreign company relating to the creation of the foreign branch must be submitted along with the application for registration to the Ministry of Trade.
In 1996, legislation authorizing the creation of International Trade Companies (ITC) was adopted. An ITC is a non-resident company in which the share capital is held by Tunisian or non-Tunisian residents where at least 66 percent of such share capital is paid through convertible foreign currency, An ITC may engage wholly in export, and 80 percent of its turnover must originate from exportation.
Source : http://www.infoprod.co.il/country/tunis2f.htm
28 – Protection of foreign currency earning enterprises : (4.0)
Foreign exchange controls in Tunisia are regulated by the Foreign Trade and Foreign Exchange Code of 1976. The government has undertaken a review of the Code and is in the process of instituting liberalization changes. The Tunisian Dinar is not fully convertible to foreign currencies, however, in recent years, Tunisia has relaxed foreign exchange control provisions regarding current account transactions. A currency account transaction law was enacted in 1993 which incorporates liberalizing provisions in this regard. Today the Tunisian Dinar is commercially convertible for all bona fide trade and investment operations. Foreign investors in Tunisian companies are entitled to repatriation capital and may receive dividends in foreign currency.
In the area of importation of goods, all import documents which involve payments must be handled through authorized banks. Foreign currency may be purchased from the Central Bank of Tunisia (CBT) or from banks which have been designated by the CBT for the payment of imports, subject to licensing restrictions and provided that the license has been obtained prior to importation. Payments for exports received in foreign currency ordinarily must be repatriated within ten days of payment. Capital transfers are subject to the approval of the CBT. Non-residents are allowed to repatriate invested capital and net proceeds of such investment in foreign currency.
Source : http://www.infoprod.co.il/country/tunis2c.htm
Tunisia's economy has emerged from rigid state control and is now partially liberalized. Beginning in the mid-1980s, Tunisia's prudent economic policies, coupled with World Bank and International Monetary Fund (IMF) support, have resulted in stable growth with healthy exports, a strong tourism sector, and favorable climatic conditions for agricultural production.
Economically and commercially, Tunisia is very closely linked to Europe. Tunisia signed an Association Agreement with the European Union (EU), which went into effect on January 1, 2008. The agreement eliminates customs tariffs and other trade barriers on manufactured goods, and provides for the establishment of an EU-Tunisia free trade area in goods, but not in agriculture or services; trade negotiations in these areas are ongoing.
Manufacturing industries, producing largely for export, are a major source of foreign currency revenue. Industrial production represents about 31.5% of GDP. It primarily consists of petroleum, mining (particularly phosphates), textiles, footwear, food processing, and electrical and mechanical manufactures. Textiles are a major source of foreign currency revenue, with more than 90% of production being exported. The Government of Tunisia, working with the European Commission and other partners, has implemented several programs to upgrade the capacity of key industrial sectors to remain competitive while the country gradually opens to trade with Europe and other regions.
Tourism is a major source of foreign exchange, representing about 11.57% of hard currency receipts ($2.572 billion), as well as an important sector for employment. In 2009, 6.9 million tourists visited Tunisia, hailing largely from Europe and North Africa. While the influx of tourists represents a boon to the economy, Tunisia's large diaspora (about 1 million) also makes a positive and significant contribution. In 2009, remittances from abroad reached 2.652 billion dinars (approximately $1.965 billion), or roughly 4.51% of Tunisia’s GDP and 7.25 % of the country’s foreign currency earnings (TND 11.687 billion, or U.S. $9.583 billion).
The country is a net importer of hydrocarbon products. Domestic crude production is 91,380 barrels per day, but refining capacity is only 34,000 barrels a day. Proven reserves are in the region of 400 million barrels. Tunisia has one oil refinery on the north coast in Bizerte and in May 2006 awarded a tender to Qatar Petroleum for a second at La Skhira, near Gabes. Natural gas production is currently about 3 million tons oil equivalent. Proven reserves are about 65.13 billion cubic feet, two-thirds of which are located offshore.
The United States and Tunisia signed a Trade and Investment Framework Agreement (TIFA) in October 2002 and follow-up TIFA Council meetings were held in October 2003, June 2005, and March 2008. Although TIFAs could serve as precursor agreements leading to bilateral Free Trade Agreements (FTAs), little progress has been made toward generating the necessary reforms required to engender an FTA. In 2004, Tunisia signed the framework agreement for a multilateral trade agreement with Egypt, Jordan, and Morocco, known as the Agadir Agreement. The Agadir Agreement creates a potential market of over 100 million people across North Africa and into the Middle East.
The government still retains control over certain "strategic" sectors of the economy (finance, hydrocarbons, aviation, electricity and gas distribution, and water resources) but the private sector is playing an increasingly important role. Tunisia is a founding member of the World Trade Organization (WTO) and is publicly committed to a free trade regime and export-led growth. In August 2010, the Government of Tunisia passed a law opening the Tunisian economy to foreign franchises in the sectors of retail/distribution, tourism, automotives, and training. Tunisia must approve franchising in other sectors, such as food service and real estate, on a case-by-case basis.
The Government of Tunisia is beginning to take a more proactive stance on intellectual property rights (IPR) enforcement and education. Tunisia's recent intellectual property rights law is designed to meet WTO TRIPS (Trade-Related Aspects of Intellectual Property) minimum standards and there is ongoing collaboration between the United States and Tunisian governments to promote public awareness of these rights.
The Central Bank is moving from direct management of the financial sector toward a more traditional supervisory and regulatory role. Commercial banks are permitted to participate in the forward foreign exchange market. The dinar is convertible for current account transactions but some convertible dinar/foreign exchange account transactions still require Central Bank authorization. Total convertibility of the Tunisian dinar is probably still some years away, though the Government of Tunisia has publicly pledged full liberalization by 2014.
Tunisia has a relatively well-developed infrastructure that includes six commercial seaports and seven international airports. Eight Arab and foreign groups were shortlisted for the construction, financing, and exploitation of a deep water port project at Enfidha (approximately 100 miles south of Tunis).
Average annual income per capita in Tunisia is over $3,851. On July 1, 2010, the minimum monthly legal wage for a 48-hour week was raised to TND 272.480 ($179.56) and for 40 hours to TND 235.040 ($154.89).
While Tunisia’s growth rate has averaged 5% over the past decade, its development goals require an average 6%-7% growth rate. In 2009, real GDP growth was 3.1% and inflation was 3.7%, down from 5.1% the previous year. According to official figures, Tunisia has 13.3% unemployment, but it is generally believed to be much higher in some regions. Despite the present low rate of population growth, a demographic peak is now hitting higher education and the job market. Tunisia has invested heavily in education, and the number of students enrolled at university has soared from 41,000 in 1986 to over 357,472 in 2009. Providing jobs for these highly educated people represents a major challenge for the Government of Tunisia.
FOREIGN RELATIONS
President Ben Ali has maintained Tunisia's long-time policy of seeking good relations with the West, including the United States, while playing an active role in Arab and African regional bodies. President Bourguiba took a nonaligned stance but emphasized close relations with Europe and the United States.
Tunisia has long been a voice for moderation and realism in the Middle East. President Bourguiba was the first Arab leader to call for the recognition of Israel, in a speech in Jericho in 1965. Tunisia served as the headquarters of the Arab League from 1979 to 1990 and hosted the Palestine Liberation Organization's (PLO) headquarters from 1982 to 1993. (The PLO Political Department remains in Tunis.) Tunisia consistently has played a moderating role in the negotiations for a comprehensive Middle East peace. In 1993, Tunisia was the first Arab country to host an official Israeli delegation as part of the Middle East peace process. The Government of Tunisia operated an Interests Section in Israel from April 1996 until the outbreak of the second Intifada in 2000. Israeli citizens may travel to Tunisia on their Israeli passports.
Wedged between Algeria and Libya, Tunisia has sought to maintain good relations with its neighbors despite occasionally strained relations. Tunisia and Algeria resolved a longstanding border dispute in 1993 and have cooperated in the construction of a natural gas pipeline through Tunisia that connects Algeria to Italy. In 2002, Tunisia signed an agreement with Algeria to demarcate the maritime frontier between the two countries.
Tunisia's relations with Libya have been erratic since Tunisia annulled a brief agreement to form a union in 1974. Diplomatic relations were broken in 1976, restored in 1977, and deteriorated again in 1980, when Libyan-trained rebels attempted to seize the town of Gafsa. In 1982, the International Court of Justice ruled in Libya's favor in the partition of the oil-rich continental shelf it shares with Tunisia. Libya's 1985 expulsion of Tunisian workers and military threats led Tunisia to sever relations. Relations were normalized again in 1987. While supporting the UN sanctions imposed following airline bombings, Tunisia has been careful to maintain positive relations with her neighbor. Tunisia supported the lifting of UN sanctions against Libya in 2003, and Libya is again becoming a major trading partner, with 2009 exports to Libya valued at $830.8 million and imports at $559 million.
Tunisia has supported the development of the Arab Maghreb Union (UMA), which includes Algeria, Morocco, Mauritania, and Libya. Progress on Maghreb integration remains stymied, however, as a result of bilateral tensions between some member countries. Tunisia has played a positive role in trying to resolve these tensions.
U.S.-TUNISIAN RELATIONS
The United States has very good relations with Tunisia, which date back more than 200 years. The United States has maintained official representation in Tunis almost continuously since 1795, and the American Friendship Treaty with Tunisia was signed in 1799. The two governments are not linked by security treaties, but relations have been close since Tunisia's independence. U.S.-Tunisian relations suffered briefly after the 1985 Israeli raid on PLO headquarters in Tunis, after the 1988 Tunis assassination of PLO terrorist Abu Jihad, and in 1990 during the Gulf War. In each case, however, relations warmed again quickly, reflecting strong bilateral ties. The United States and Tunisia have an active schedule of joint military exercises. U.S. security assistance historically has played an important role in cementing relations. The U.S.-Tunisian Joint Military Commission meets annually to discuss military cooperation, Tunisia's defense modernization program, and other security matters.
The United States first provided economic and technical assistance to Tunisia under a bilateral agreement signed March 26, 1957. The U.S. Agency for International Development (USAID) managed a successful program until its departure in 1994, when Tunisia's economic advances led to the country's "graduation" from USAID funding. Tunisia enthusiastically supported the U.S.-North African Economic Partnership (USNAEP), designed to promote U.S. investment in, and economic integration of, the Maghreb region. The program provided over $4 million in assistance to Tunisia between 2001 and 2003. The Middle East Partnership Initiative (MEPI) was launched in 2002 and incorporated the former USNAEP economic reform projects while adding bilateral and regional projects for education reform, civil society development, and women's empowerment. In 2004, the MEPI Regional Office opened in Embassy Tunis. The Regional Office is staffed by American diplomats and regional specialists. It is responsible for coordinating MEPI activities in Algeria, Egypt, Lebanon, Morocco, and Tunisia in close coordination with the American Embassies in those countries. The United States also supports Tunisia's civil society and economic development through bilateral Economic Support Funds programs.
American private assistance has been provided liberally since independence by foundations, religious groups, universities, and philanthropic organizations. The U.S. Government has supported Tunisia's efforts to attract foreign investment. The United States and Tunisia concluded a bilateral investment treaty in 1990 and an agreement to avoid double taxation in 1989.
American firms seeking to invest in Tunisia and export to Tunisia can receive insurance and financing for their business through U.S. Government agencies, including the Overseas Private Investment Corporation and the Export-Import Bank. The best prospects for foreigners interested in the Tunisian market are in high technology, energy, agribusiness, food processing, medical care and equipment, and the environmental and tourism sectors.
Source : http://www.state.gov/r/pa/ei/bgn/5439.htm
Source : http://www.infoprod.co.il/country/tunis2c.htm
29 – Management of foreign currency budget : (1.5)
According to the World Trade Organization, trade represented 116.7% of Tunisia’s GDP from 2006-2008. In 2008, merchandise exports totaled over $19.3 billion while merchandise imports totaled over $24.6 billion. In 2008, commercial services exports totaled over $5.5 billion while commercial services imports totaled over $3 billion. Major Imports and Exports According to the International Trade Centre, the top five export categories for Tunisia in 2008, along with percentage of total exports, were:
1. Mineral fuels, oils, distillation products, etc. (17.3%) 2. Electrical and electronic equipment (15.7%) 3. Articles of apparel and accessories not made of knit nor crochet (14.4%) 4. Fertilizers (7.9%) 5. Inorganic chemicals, precious metal compound, and isotopes (5.7%) According to the International Trade Centre, the top five import categories for Tunisia in 2008, along with percentage of total imports, were: 1. Mineral fuels, oils, distillation products, etc. (16.9%) 2. Boilers, machinery, nuclear reactors, etc. (11.1%) 3. Electrical and electronic equipment (9.5%) 4. Vehicles other than railway (6.1%) 5. Cereals (4.9%) Major Trading Partners The top three countries to which Tunisia exports merchandise, along with percentage of exports, are: 1. France (28.3%) 2. Italy (17.9%) 3. Germany (9.6%) The top three countries which import merchandise to Tunisia, along with percentage of imports, are: 1. France (21.5%) 2. Italy (19.3%) 3. Germany (9%)
Sources: World Trade Organization, International Trade Centre, and World Fact book
Source : http://www.afribiz.info/content/import-and-export-snapshot-for-tunisia
30 – Layers of collective action :
The Government puts into effect the general policy of the nation, in conformity with the orientations and options defined by the President of the Republic. The Government is responsible to the President of the Republic for its conduct.
The people exercise the legislative power through a representative organ called National Parliament. The members of the National Parliament are elected by universal, free, direct, and secret suffrage, according to the modalities and conditions determined by the Electoral Law.
An elector is every citizen possessing Tunisian nationality for at least five years and having attained at least twenty years of age. Any voter, born of a Tunisian father, who is at least twenty-five years of age on the day of submission of his candidacy, is eligible for election to the National Parliament.
The National Parliament is elected for a period of five years in the course of the last thirty days of its mandate. In case of impossibility of proceeding with the elections during the designated time, because of war or imminent peril, the mandate of the National Parliament is extended by a law until the time it is possible to proceed with the elections.
The National Parliament meets each year in ordinary session which begins during the month of October and ends during the month of July. However, the first session of every legislature begins during the first fifteen days of November.
During the vacation, the National Parliament may meet in extraordinary sessions on the request of the President or the majority of deputies. No deputy can be arrested or prosecuted for the duration of his mandate for a crime or misdemeanor as long as the National Parliament has not lifted the immunity which covers him. However, in the event of flagrant offence, arrest procedure is permitted, in such a case, the National Parliament is to be informed without delay. The detention of a deputy is suspended if the National Parliament so requests.
Source : http://www.llrx.com/features/tunisia.htm
31. Business Climate and religion : 1.0
The Constitution provides for freedom of religion and the freedom to practice the rites of one's religion unless they disturb the public order; however, the Government imposes some restrictions on this right. The Constitution stipulates the country's determination to adhere to the teachings of Islam, that Islam is the official state religion, and that the President is required to be a Muslim.
There was no change in the status of respect for religious freedom by the Government during the reporting period. The Government prohibits efforts to proselytize Muslims; it also restricts the wearing of "sectarian dress," including the hijab (Islamic headscarf). Domestic and international human rights organizations reported instances of police harassment of women wearing the hijab and men with traditional Islamic dress and beards. The Government sponsored a number of conferences to promote religious tolerance during the reporting period. Muslims who converted faced social ostracism. Middle and upper class secularists discouraged women from wearing the hijab. The press published some cartoons depicting derogatory caricatures of Jews to criticize Israel.
The U.S. Government discusses religious freedom with the Government as part of its overall policy to promote human rights.
Source : http://tunisia.usembassy.gov/dos_reports2/international-religious-freedom-report-20011.html
Status of Business owner: (0.5) very low :
Tunisia presents an unprecedented opportunity to support a democratic transition in a post-authoritarian Arab state. But, as a recent report cautioned, that prospect is threatened by economic fragility resulting from lost tourist revenue and substantial capital flight.
“While the thirst for political reform is unquenchable, little has emerged about their attitude towards the economic reforms their countries desperately need,” an analyst notes. “That debate, when it comes, could be as wrenching as the political upheaval” – in Egypt as much as Tunisia:
That is because the Mubarak and Ben Ali regimes, which ran their economies as rackets for a tight circle of kleptocrats and concessionaires, may have discredited the very idea of reform. That discredit is the greater insofar as Egypt and Tunisia were held up by bodies such as the International Monetary Fund and World Bank as pioneers of economic reform in the region, while what Egyptians and Tunisians saw was cronyism and regime maintenance.
Similar concerns were expressed today at a Washington conference on Tunisia’s path to democratic and economic reform organized by the Center for International Private Enterprise
Business cannot be separated from a country’s political culture, but the private sector has been off the pace when its contribution is vital to ensuring a democratic transition in Tunisia and, therefore, across the region.
Wary of corruption and entrapment, entrepreneurs had largely shunned politics under Ben Ali’s authoritarian regime, said Nazeh Ben Ammar, president of the Tunisian American Chamber of Commerce. But business owners did belatedly support the revolution and now accept the need to become better organized in articulating private sector demands while pressing for market-friendly reforms.
Source : http://www.demdigest.net/blog/2011/03/crony-capitalism-and- populist-politics-threaten-tunisias-transition/
32.Government Enterprises : (1.0)
Historic Growth Trend of Tunisia’s Economy, 1962 – 2007 Since the 60s Tunisia economic performance has been following a relatively growing trend. The strong human capital base, as well as the adaptability of the Tunisian people to transforms, and that’s due to many historical and environmental aspects, are the main factors behind the sustainable Tunisian economy.
The Government role to emphasize the economy is crucial, no question about it, although not in the case of Tunisia, where the government has always been an obstacle to a healthier economic expansion, considering all the potential that Tunisia has to pursue the path of countries like Greece, Cyprus, Malta, or south Korea. But the kleptocratic nature of the regime, as well as bureaucracy, and atrocious regulations have been drastically decelerating Tunisia’s economics prospective.
Not to mention all the efforts made by the regime’s propaganda machine to capitalize on the little progress made by the Tunisian people to draw a falsely successful picture, take the credit for it, build on it the whole strategic theme of Ben Ali’s electoral campaign, and make it the main argument for “Tunisians” to beg him and persuade him to run yet again for a fifth consecutive term!
I would further state, and according to unconfirmed sources, that Ben Ali’s personal fortune is estimated by Forbes magazine to exceed 5 Billion dollars, while the external debt per Tunisian is rising greater than ever since Ben Ali’s coup d’état, increasing from 887 USD in 1987 to nearly 2000 USD per citizen in 2008! (see External debt per Tunisian figure below)
It should be noted also, that by the end of 2005, and as stated by the Tunisian Chamber of Commerce and Industry, 194 companies had been privatized at a total value of 2.4 billion TND ($1.8 billion). In 2006 the country had seen its biggest-ever privatization operation in terms of value, when Ben Ali’s regime sold 35% of the national telecommunications company Tunisie Telecom, which represents, according to the same source, almost twice as much as all other privatizations since 1987 combined.
33 - International Security Agreements: (1.0)
Nato : On 10 May, the Minister of Foreign Affairs of the Republic of Tunisia, H.E. Mr. Kamel Morjane, visited NATO Headquarters for a bilateral meeting with the Secretary General, H.E. Mr. Anders Fogh Rasmussen.
During the meeting, they discussed the way forward in NATO-Tunisia cooperation within the framework of NATO’s Mediterranean Dialogue. They also exchanged views on new and emerging security challenges.
Source : http://www.nato.int/cps/en/SID-627D9B30-9347CA2E/natolive/news_63625.htm
1- Property Rights :
The executive branch is the supreme arbiter of events in the cabinet, government, judiciary, and military. Commercial cases take a long time to resolve, and legal procedures are complex. Tunisia’s intellectual property rights law is designed to meet the World Trade Organization’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) minimum standards. Customs agents do not investigate copyright violations without a complaint by the copyright holder. Pirated print, audio, and video media products are sold openly. Illegal copying of software, CDs, and DVDs is widespread.
2- Investment Freedom : 0.5 (Pro-Business)
Before the Revolution :
Tunisia restricts foreign investment in some sectors to minimize the impact on domestic competitors. Foreign investment is screened, and majority ownership of companies by foreign investors is not allowed without government approval. In general, domestic trading can be carried out only by a company in which the majority of the share capital is held by Tunisians and management is Tunisian. Bureaucratic procedures are cumbersome and inconsistent, the ability to retain foreign labor is restricted, and the courts are susceptible to political pressure. Residents and non-residents may hold foreign exchange accounts, subject to restrictions and approval. There are some restrictions on capital transactions, payments, and transfers. Foreigners may not own agricultural land.
Source : http://www.heritage.org/index/country/Tunisia
After the revolution : (4.0)
According to the economist Adbeljelil Bedoui for stability to return "the State has to take control or nationalize business of the Ben Ali clan." He said they would also have to tackle the black economy, which he estimates at between 10 and 15 percent of the GDP and as much as 40% of the non-farm employment.
The government has already nationalized two banks, the Zitouna and Central Bank of Tunisia, that were facing collapse and linked to the Ben Ali clan.
The European Union agreed to freeze the assets of the former Tunisian president, his wife and their associates on Monday France24 reported. On Tuesday French authorities seized a small aircraft belonging to the Ben Ali family. Ben Ali is estimate to have amassed a $50 billion USD fortune that includes banks, tuna export, hotels, construction, newspapers and pharmaceuticals during his two decade dictatorship. Tunisia is a former French colony and France is still it's major trading partner and the seven billion USD in trade a year is crucial to the Tunisian economy. Habib Gaida, president of the Franco-Tunisia chamber of commerce, said nearly all French businesses operating in the country had gotten back to business within two days of Ben Ali's fall. Finally free of the corruption and control of the Ben Ali mob, the mood in the business community is determinedly upbeat. Zied Lahbib, who is number two at the agency promoting foreign investment said "The Ben Ali regime was a lead jacket for the business environment." Another thing propelling the post-Ben Ali business environment is the return of expats. "Businessmen from the Diaspora are already contacting us to return, because they are Tunisians but also because they want to be the first into the markets, most of all in new technology and computer engineering," Lahbib added.
There has been a new freedom of the press since the government restrictions have been lifted. Those rules required running a picture of the ruling family on the front-page everyday for example. Interim PM Ghannouchi has lifted all restrictions on the press and abolished the hated Information Ministry. “Finally the Deliverance” ran the front page headline in the French-language daily Le Quotidien a week ago. This North African nation is now celebrating three weeks of freedom from the iron fist of a dictator that rule them for more than two decades. They still have many challenges ahead and the forces of counter revolution are by no means spent, but the Tunisian people are now well on the way to consolidating their revolution.
Source : http://wlcentral.org/node/1231
3- Safety and Security - Political Situation : (1.0)
Following the departure of the President, a State of Emergency was declared on 14 January, Foued Mbazaa took over as interim president. A National Unity Government was formed and accepted by all key political groupings. Since its formation there have been several changes in key figures within the Government, including the Prime Minister. There are still some who oppose key figures within the government and the potential for further anti-government demonstrations remains.
Demonstrations could occur at any time and in any location across Tunisia. You should avoid any such gatherings. Although foreigners are unlikely to be targeted in any unrest there is a risk of incidental violence if the demonstration does not pass peacefully.
If you see a gathering, rally or demonstration move quickly away from the area if it is safe to do so. Monitor developments closely using all available resources, (local and international news, hotel staff and tour operators). If you are aware of demonstrations nearby, or are in any doubt about the safety of your location, stay in your accommodation.
Some groups are also using industrial action as a form of protest. We have witnessed a number of unannounced strikes of public sector employees, including the police, and expect that there will be more. This may cause disruption to services and itself lead to public protest.
You may encounter increased security near strategic sites.Approach any members of the security authorities slowly, follow their instructions and present ID on request.
Source : http://www.fco.gov.uk/en/travel-and-living-abroad/travel-advice-by-country/middle-east-north-africa/tunisia
34. Protection of Domestic Enterprises from Government Mandated Costs : (1.5)
1- Business Freedom :
Along with privatization of more than 200 state-owned enterprises over the past two decades, Tunisia has adopted structural reforms and enhanced its entrepreneurial climate. Procedures for launching and conducting a business are not time-consuming, and bankruptcy proceedings are straightforward.
2- Corruption :
Corruption is perceived as significant. Tunisia ranks 65th out of 180 countries in Transparency International’s Corruption Perceptions Index for 2009. Corruption is less pervasive than in neighboring countries. Unfair practices and corruption among prospective local partners reportedly can delay or block specific investment proposals, and cronyism and influence peddling can affect investment decisions
3-Government Spending:
In the most recent year, total government expenditures, including consumption and transfer payments, held steady at 27.3 percent of GDP. The state-owned mobile and fixed-line telephone enterprise is slated for sale to a French telecommunications company.
Source : http://www.heritage.org/index/country/Tunisia
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