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Tunisia keeps its economy in the right track

Friday, 16 October 2009 15:10

Tunisia continues to receive encouraging ratings in international reports. Following the latest World Economic Forum Global Competitiveness Report where Tunisia was ranked first in Africa and in the Maghreb, Tunisia is ranked 6th in the world in terms of stock market performance out of a total 82 countries. Tunisia ‘s stock exchange has witnessed a double-digit growth (+12,04) along with 12 other countries, according to a report published early October by the “Bespoke Investment Group”,

According to the “S&P 500”, 28 % of countries are recording a rise, one year after the collapse of the American Bank, Lehman Brothers.

China tops the field with a rise of 30.55 % ahead of Venezuela, Indonesia, Turkey, Vietnam and Tunisia.

Moreover, Tunisia is ranked first in North Africa, in the annual report on good governance recently published by the Harvard Kennedy School of Government. The report credits Tunisia with an overall score of 71.5 points out of 100.

Tunisia is credited with excellent scores on the strength of its performance in terms of “human development,” “transparency and rule of law” and the “climate of security”, with scores of 89, 70.5 and 100 points respectively.

Tunisia comes ahead of Algeria (7th), Morocco (12th), Egypt (18th) and Libya (21st).

The third annual report published by the Kennedy School of Governance which is part of Harvard’s school of political sciences, focuses this year on “Strengthening Governance in Africa”.

The rankings were established on the basis of 57 indexes of good governance centred on such determinants as security, transparency, rule of law, participation and human rights, economic stability and human development.

The report stresses the correlation between good governance, on the one hand, and development and security of each country, on the other.

It also points out, that the “best governed African countries are those which are well led, provide their citizens with the best services, hold free and fair elections and are the least corrupt.”

Regarding The 2010 Doing Business Report, Tunisia is ranked 69 overall by the World Bank Group and International Finance Cooperation IFC, after gaining 4 places in comparison with 2008 (73) .

Tunisia has won 70 places overall moving from 143d place to 73d place in terms of protecting investors , it has also gained 2 place in terms of “Trade across Borders”, moving from 42d to 40.

The report indicates that Tunisia eased trade rules by raising the total tax rate for businesses by 3.7 percentage points, through an increase in social security taxes of 0.6 percentage points and an increase of 3.1 percentage points for abandoning accelerated depreciation.

Thanks to the setting up of an electronic one stop shop, Tunisian traders can quickly file all documents required to clear their cargo online; moreover, the system has reduced processing delays by two days.

Tunisia also strengthened investor protections by requiring greater corporate disclosure.

With this improvement, Tunisia remains ahead of MENA region countries including Turkey, Morocco and Algeria. In the Arab world, it is preceded by the Gulf countries and in Africa by South Africa.

The report is based on 10 major indicators including ease of doing business, starting a business, dealing with licenses, employing workers, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, and closing a business.

17 of the 19 economies in the region passed regulatory reforms to create opportunity for domestic entrepreneurs and 131 countries reformed business regulations between June 2008 and May 2009.

The 2009- 2010 World Economic Forum Global Competitiveness Report ranks Tunisia for the third consecutive year, as the most competitive economy in African and in the Maghreb.

The Report ranks Tunisia 40 th in the world before South Africa (45), Jordan (50), Brazil (56), Turkey (61), and the Russian Federation (63).

In the Euro zone, Tunisia does better than Portugal (43rd), Poland (46th), Slovakia (47th), Italy (48th), Hungary (58th), Romania (64th) and Greece (71st).

The report is based on data and surveys involving 12 ‘pillars’ covering, institutions, infrastructure, macro-economic stability, health and primary education, higher education and training, goods market efficiency, market size, labor market efficiency, technological readiness, financial market sophistication, business sophistication, and innovation.

The report writes that Tunisia’s efficient government institutions (15 th) remain its main strength , along with a high level of security (23 th ) and an educational system which ensures a good quality of education (29 th).

In sub-headings, Tunisia ranks 5th in the world in terms of wastefulness of public spending, 7th in terms of quality of math and science education, 8th in agricultural policy costs, 9th in the availability of scientists and engineers and 11th in the protection of minority shareholders’ interests.

The country is also ranked 16th in terms of public trust of politicians and 18th in the world in matters of impartial government decisions.

Tunisia keeps its economy in the right track, thanks to the country's political stability since the Change on November 7, 1987, the climate of confidence, and the liberation of initiatives, Tunisia has been able to take confident and decisive steps towards the openness of its economy and the achievement of social welfare for its citizens.

In this perspective, Tunisia has initiated an important program of multisectoral reforms aimed at laying the foundations for a solid, diversified and competitive economy capable of adapting to the new international environment.

These basic reforms which aim to eliminate the imbalances impeding the deregulation of initiatives, have affected in turn prices, commerce, the tax system, the investment incentive system, the banking sector, the stock market and the capital market as well as the restructuring of public enterprises and the start of a major program of privatization and administrative reform.

At the same time, special attention has been paid to the promotion of human resources through reforms of the educational and vocational training systems, which is likely to fulfill all the necessary conditions for the success of the program of overall upgrading of the economy, to improve productivity and face foreign competition under the best possible conditions.

Perseverance with reforms has enabled Tunisia to make significant gains on the economic as well as the social fronts.

Since 1987, Tunisia has recorded an average growth rate of 5%. Furthermore, despite the intensification of the world debt problem, Tunisia has managed to reduce its total debt burden. During the last few years, international financial institutions have frequently cited Tunisia as a "success story" in terms of economic structural adjustment.

Global Arab Network

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Last Updated on Friday, 16 October 2009 15:56

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