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Tunisia’s success – Political stability, sustainable development

Global Arab Network - - George Haddad

Sunday, 06 June 2010 11:22

Carthage Investment Forum- The latest report on global competitiveness 2009-2010 issued by the Davos World Economic Forum ranks Tunisia 40th out of a total of 133 developped and emerging countries in terms of global competitiveness being hence ahead of several countries of the EU.

Between 2006 and 2009, the average growth rate was of about 4.9% per year at constant prices resulting in an average annual growth of the GNAI per capita of about 8.3 % over the same period.

The Tunisian Agency for Foreign Investment Promotion (FIPA) held the Carthage Investment Forum, aiming to make better known the Tunisia opportunities among foreign business communities.
Mr._Mohamed_Ghannouchi_Tunisia

In the opining ceremony, Tunisia Prime Minister, Mr. Mohamed Ghannouchi stressed the Tunisian government’s strong commitment, under the impetus of President Ben Ali, to move forward to expand the reform process, deepen integration of the country’s economy in the global economy and further prompt partnership under all its forms with enterprises of sisterly and friendly countries.

He added that the global financial crisis, whose fall-outs have not totally evaporated yet, does not impact in any means on the choice of openness and partnership. On the contrary, it has strengthened that option, he said.

Drawing an exhaustive balance sheet of the performances made by the Tunisian economy, Mr. Ghannouchi said the “drive to rehabilitate initiative, strengthen competitiveness and improve the investment climate has helped us over the past twenty years to launch the Tunisian economy on a steady growth track equal to 5% a year at constant prices and manage to achieve a continuous improvement of the citizen’s buying power.

The per capita income stood in terms of buying power parity at 9,000 dollars in 2009.”

He said, that “this has allowed us to have a viable financial balance with a debt made up essentially of mid- and long-term loans, accounting for less than 40% of the country’s GDP and to earn honorable international ratings in matters of global competitiveness (40 out of 138), business environment (69 out of 183), administrative services (66 out of 192) and external trade facilities (38 out of 125 countries).

Regarding business environment indicators, the prime minister reminded that nowadays a limited liability company can be established in an hour’s time at one-stop shops of the Industry Promotion Agency (API) in Tunis, Sousse and Sfax and in 48 hours at the latest and that customs clearance procedures for many goods have been considerably eased with the coming into force of the new Customs Code and thanks to the computerization of foreign trade procedures as part of the one-stop shop project.

Regarding back-up reforms, Mr. Ghannouchi said that the employment policy has been revisited to optimize its performance, while vocational training programs have been restructured to enhance the training of skills needed by the economy, stressing that an ambitious program of revival of public investment is carried out concurrently.

This program has involved such great works like expansion of the highway network, the railway network, power production, sanitation and telecommunications.

He said that thanks to these measures, Tunisia has managed to preserve the dynamics of growth (3.1% in 2009), to minimize worsening of unemployment and was able, and this might be considered as the most significant result, to preserve basics of the economy with an inflation rate limited to 3.5% of the GDP and a public debt below 50% of the GDP. The Premier also addressed the development of the Tunisian economy.

He added that “over the past years growth of the Tunisian economy has been propelled by the efficiency of production factors, the improvement of production having contributed at no less than 40% to the growth of the country’s GDP”.

This growth, he said, should be henceforth stimulated by innovation. This is possible, he said, owing to several factors: the availability of a growing number of engineers, scientific and technological skills (the number of graduate engineers will increase from 5,000 in 2009 to 7,000 in 2011 and 9,000 in 2014), technological infrastructure with the launch over the recent years of a large program of technological parks, the establishment in Tunisia of a growing number of innovating groups in telecommunications, software, data processing, pharmaceutical products and electronics and finally the government’s policy which backs scientific research and technology with the allocation of 1.25% of the GDP to it in 2009 and 1.3% of the GDP in 2010.

This option has been clearly retained by the electoral program of the President of the Republic which is a roadmap of the government action for the 2009-2014 period.

A better targeting will be put into effect in matters of taxation and financial incentives so as to encourage the investments representing a priority for the country, such as those serving regional development, environment protection and especially adoption of innovating technologies, as well as the creation of new technologies.

“The investment law meant to this end is under revision to take into account these priorities,” he specified.

At the strategic level, the Prime Minister pointed out that the integration process of the Tunisian economy into the world economy, in general, and the Euro-Mediterranean space in particular, will be broadened.

“The priorities at the present stage being the finalization of negotiations on the liberalization of services with the European Union and accession to the status of advanced partner of the European Union”, he noted

Tackling the large-scale projects launched or under preparation as part of the 2010-2014 plan, the Premier cited the 5-million tons oil refinery, the new 400-megawatt power station as part of the concession system, the program of renewable energies providing for the achievement of 1000 megawatts over a 10-year period, extension of the broadband Internet connection, computerization of public hospitals and computerization of the CNAM fund.

The 12th edition of the forum, attended by some 1000 participants from 23 countries, also seeks to favour a better profile of what Tunisia can provide in matters of technology, know-how and available skills.

According to FIPA General Manager, Mrs. Mongia Khemiri, this theme established as a highly strategic niche, fits into the 11th point of the Presidential Program (2009-2014): "Towards an economy with high technological content, environmentally friendly, energy saving and innovative.”

One of the three panels devoted to presenting the role of human resources and enterprises in being in command of technology.

Emphasis placed on the effort deployed by the Tunisian government ''in education, research, training, ownership by the public and private economic agents of technology and improvement of its penetration into productive sectors.''

Particular attention focused on long-term development of a dozen science parks nationwide. Tunisia aims to create privileged areas or "islands of excellence" to promote synergies between education, research and entrepreneurship and agglomeration effects that are highly attractive to foreign investment.

The second panel examined the way Tunisia is perceived in international relations with respect to competitiveness, environment, human development, and assessment of Tunisian economy by the World Bank).

For Mrs. Mongia Khemiri, special attention given to the analysis of the good scores achieved by Tunisia in some sub-headings such as governance and good management of public funds.

The third panel dealt with ''off shoring, towards a more technological evolution.'' The panelists reviewed the international relocation of services in Tunisia, especially ICTs (11 % of the GDP) and services provided by computer engineering firms.

ICTs, which have contributed to the phenomenon of off shoring services, have allowed fixing strategies in Tunisia entirely dedicated to developing new activities: call centers, data entry, tele-solicitation services, basic technical support, transaction processing, research and development, engineering.

In the last few years, foreign investment increased in high added value industries for which Tunisia has significant comparative advantages.

Tunisia continues to be an attractive host country for foreign investment. Foreign direct investment (excluding portfolio investments) increased from 402.9 million TND in 1997 to 2 278.7 MTND in 2009.

Foreign direct investment (FDI) made in 2009 represents 13.7% of GFCF, 4% of GDP, 27% of private investment, 37% of external capital inflows and 26% of newly created jobs.

Tunisia's political, economic and social stability and the business environment improvement contributed to achieve these positive results due to numerous carried-out reforms.

Global Arab Network

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Last Updated on Sunday, 06 June 2010 12:47

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