Tunisia’s Fledging Democracy in Danger: Europe to Pay for Stable Neighborhood

Written by | Thursday, February 22nd, 2018

Tunisia’s position as the only fledging democracy in the Arab world is at risk due to the inability of its leaders to articulate and introduce bold economic reforms that would help the country tackle mass unemployment and deal with the poor education of young people.

What followed the Arab Spring has brought mixed results. The freedom of speech that ensued the fall of the dictatorship of Ben Ali and his ruling family has unfortunately turned into freedom of insult and blackmail. While the new democratically elected government added 140,000 employees to an already bloated civil service and state firms, it appointed mostly its own supporters who were moreover not competent to do the jobs. At the same time though, the new leadership advanced some of the human rights such as granting women equal rights except where inheritance is concerned.

But, on the other hand, the new government also turned a blind eye to some of their hard line supporters who became jihadi terrorists, being trained in camps set up in neighboring Libya. The result is demoralization of the civil service. The terrorist attacks on the National Bardo Museum in Tunis and the tourist resort of Sousse three years ago devastated tourism, which is a key sector of the Tunisian economy. As a result, potential foreign investors were put off from investing in Tunisia’s thriving industrial offshore sector.

Economic growth has been lukewarm and Tunisia’s external accounts have worsened significantly. Despite the agreement with the IMF, which lent the country $2.9 billion almost two years ago, the foreign debt has gone up from less than 40% of GDP in 2010 to almost 80% in 2017 and the current account deficit doubled. Public debt amounts to 70% of the country’s GDP as against was 40% in 2010 and the Tunisian Dinar has lost a fifth of its value against the Euro in 2017 while inflation is running at 6.3% annually.

To make things worse, the informal sector has developed rapidly and now accounts for about half of the GDP with all the implications that it entails. The government is losing income tax and foreign goods brought in illegally across the porous border from Libya are forcing the closing of Tunisian factories. Despite these issues, there is very little political will to reform the system to improve the economy.

While the local authorities are by and large inactive, the West should not be indifferent to the fate of the tiny North African country. While it was the French that led the NATO-supported intervention in Libya in 2011, which toppled Muammar Gaddafi, no one in the West gave a thought to what would happen if Libya disintegrated despite warnings from Algeria. Tunisia is losing 2 percentage points of growth every year because of the dire security situation in Libya, the World Bank research has found. If the country were to collapse, the immigrant crisis the EU faces would become very hard to manage.

Tunisia deserves Europe’s attention and support. A few billion dollars that Tunisia would need to help it deal with all these challenges is not a big price to pay if Brussels seriously wishes to ensure the survival of the only North African democracy.

‘Seven Years After the Arab Spring, Tunisia Faces an Uncertain Future’ – Opinion by Francis Ghilès – Barcelona Centre for International Affairs / CIDOB.
(The Opinion can be downloaded here)

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