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Textile in Tunisia -Environment for growth

Global Arab Network - - Maha Karim

Friday, 06 November 2009 00:55

Tunisia’s textile and clothing industries have evolved steadily over the past 40 years. A major change in strategy was adopted early in the 2000s.

This new orientation seeks to promote vertical integration, shift to up-market ready-to-wear clothing, and produce small and medium-size series.
Its ability to adapt has helped the textile/clothing sector position itself as one of the pillars of Tunisian industry.

The largest number of European companies on the southern rim of the Mediterranean
A liberal legal framework has helped foreign companies establish sound partnerships that have helped them develop their activity in Tunisia.
Some 1000 Tunisian companies work in partnership with EU companies. Over the period 2005-2008, investment in the textile/clothing sector grew by 27%. Of these 1000 companies, the majority are in partnership with French firms (365), Italian (206), Belgian (121) and German (106). Over the past five years, one fifth of all foreign direct investment to manufacturing industries went to the textile/clothing sector.

Export sector
Tunisia is one of the leading suppliers of clothing in the world. It is the 5th largest supplier to Europe and the 2nd largest supplier to France.
The European Union is by far the major destination for Tunisia’s goods, absorbing 96% of the sector’s exports. France, Germany, Italy and Great Britain alone take in 82% of Tunisian exports.

Proven know-how
Tunisia has a large pool of young, experienced people who are quick learners. In order to maintain competitiveness and know-how, companies in the sector can take advantage of:
a university and professional training network of more than 30 schools, institutes and training centres covering virtually all branches of the textile/clothing sector, legislation governing labour and environmental protection that is comparable to that found in developed countries, in line with the growing demands of consumers in the area of ethical conduct, respect of quality norms and international standards, Tunisian companies meet the expectations of a large spectrum of international clients by offering a wide range of products and product lines.

Incentives
The legislative and regulatory framework provides real advantages for foreign investors: total freedom to invest and the possibility of holding 100% of capital, repatriation of dividends and of proceeds from the sale of capital, the right to foreign exchange for current transactions and the possibility of using bank accounts held abroad. To encourage export of goods and services, incentives are available in the form of total exemption from duty and levies on imported equipment, raw materials and semi-nished goods, as well as total exemption from tax on prots for the first 10 years of activity.

Geo-strategic location and supportive infrastructure
Tunisia is at the heart of the Euro-Mediterranean logistic chain, near the main European cities and on the doorstep of a market of 500 million consumers. Less than an hour’s flight from Europe, Tunisia has seven international airports throughout the country catering to some 100 foreign airlines and servicing more than 1300 flights a week to and from Europe. Seven commercial ports and a modern maritime ﷓fleet that meet the required standards of security and rapidity service ships to the main European ports. There are modern roads and telecommunication services and the cost of electricity and water is competitive, thanks to reliable, high performing networks. In its 2008-2009 annual report, Davos ranks Tunisia first in Africa in ICT.

Proven profitability
Tunisia is ranked the most competitive country on the southern rim of the Mediterranean (Davos World Economic Forum, World Competitiveness Report, 2008-2009). Many studies carried out by internationally renowned consulting firms place Tunisia well ahead of a number of countries in the Euro-Mediterranean region in terms of return on investment in the clothing sector. Along with comparable qualifications, skills and quality, Tunisia offers competitive production costs, up to five times lower than in the European countries with which it is in competition.

Getting things done quickly
Tunisia’s textile/clothing sector is highly reactive, able to work on a tight schedule. This means it is particularly well suited to deal with small and medium volume series, restocking and fast fashion. Procedures for setting up a business have been greatly simplified, facilitated by the establishment of one-stop shops at which a company can be set up and administrative formalities carried out. Practical but critical arrangements are in place to ensure smooth operations: ports are open 24 hours a day, there is a single bundle of documentation for import and export formalities, bonded warehouses are now easily available … These many measures ensure that time frames meet the wants and needs of industrial operators.

Global Arab Network

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