On the day of the Paris terror attacks US Secretary of State John Kerry visited Tunisia, five years after the Arab Spring erupted and months after Tunisia’s own Isis assaults on prominent tourist sites. Kerry pledged additional security and economic support as the US Congress considers a package doubling it to $135bn next year, and hailed the country’s political transition that earned those in charge the Nobel Peace Prize.
However, one in three members of the Nidaa Tounes party in Tunisia’s ruling coalition resigned before Kerry’s arrival to protest continued corruption and economic stagnation, and development initiatives were largely confined to another sovereign bond guarantee and backing for IMF, World Bank and other assistance programmes in place for several years with mixed results. Although Washington is willing to underwrite commercial debt, it could go much further in promoting local financial market development, in particular in partnership with private sector banks and fund managers who have been absent, as a wholesale rethink of post-Arab Spring aid for Tunisia and its neighbours is long overdue. Read more
One of the most interesting solar projects around, TuNur, hopes to generate two nuclear power plants’ worth of renewable electricity in the Tunisian desert, export it to Italy via a 1,000km high-voltage DC cable and connect it to European grids as far afield as the UK, where it could power over 2m homes.
Three developments are helping and could set a precedent for further projects: strides in the cost-effectiveness both of undersea transmission cables and solar power, the EU’s Energy Union and climate packages, and the new Tunisian government’s liberalisation of its energy laws. Read more
Hopes are high for Tunisia’s economy after Nida Tunis, the country’s main secular party, won power in the second free election since an uprising that cast out autocrat Zein al-Abidine Ben Ali in 2011.
That was the Arab spring’s first revolution and since then Tunisia has fared better than its neighbours. It has avoided the turmoil of Egypt, the chaos of post-Qaddafi Libya and the civil war of Syria. Read more
It is not news that under its ousted dictator, Zein al-Abidine Ben Ali (left), Tunisia was a kleptocracy, its heavily-regulated economy milked by the disgraced ruler, his extended family and others with political connections.
But now three years after the revolution which toppled Ben Ali, the World Bank says that restrictions on economic participation which blocked competitors and allowed his cronies to feather their nests are still in place. These continue to stifle the private-sector, ensuring that only a small number of people benefit at the expense of the majority of Tunisians. The result is poor economic growth and high youth unemployment –the very reasons which drove much of the discontent that led to the 2011 revolt against Ben Ali. Read more
Young Arabs are increasingly turning their backs on cushy public sector jobs in favour of working for private companies and starting their own businesses, a survey in 16 countries has found.
There has also been an erosion in optimism that the “Arab spring” uprisings in recent years against authoritarian governments across the region will translate into better lives for ordinary people, the survey found. Read more
Political turmoil in Tunisia has struck a heavy blow to the country’s economy. The assassination of opposition leader Mohamed Brahmi last Thursday and the killing of eight soldiers by militants near the Algerian border on Monday have shaken investors’ nerves once again. Read more
Smiles all round on the faces of those officials of the European Bank for Reconstruction and Development who successfully lobbied for their role to be broadened from their traditional stamping grounds in eastern Europe to Turkey, North Africa and beyond.
As any visitor to the organisation’s annual meeting in Istanbul on Friday would have seen, top officials from the likes of Poland, Ukraine and Russia were notable for their absence. But there to fill the gap were the prime ministers of Tunisia, Egypt and Jordan, not to mention the host, Turkey’s premier Recep Tayyip Erdogan. In the ex-Communist bloc, the EBRD is now old hat. In and around the Mediterranean, it still makes news. Read more
For Tunisia, the deal is done. But as far as the bigger, trickier north African question goes, there are merely encouraging words.
On Saturday, the IMF concluded terms with the Tunisian government on a crucial loan. Meanwhile for Egypt, while talks continue in Washington on the sidelines of the IMF spring meeting, no news is a worry. Read more
A mixed bag for the IMF in north Africa in April, if early reports are anything to go by.
Egypt’s talks with the Fund over a $4.8bn (plus) deal have floundered – again. But there is better news 2,000km to the west, where Tunisia looks to have sealed a $1.78bn loan. Read more
Tunisia is hoping that the country’s first government sukuk, or Islamic bond, scheduled for later this year could spur companies in the North African country to raise Islamic debt and boost its sharia-compliant finance industry, writes Camilla Hall.
The government is working alongside the Islamic Development Bank – the multilateral lender – to pave the way for a 1bn dinar ($700m) sukuk sale that would set a benchmark for companies seeking to tap the Islamic debt markets, Elyes Fakhfakh, finance minister, told the Financial Times. Read more
April looks set to be a busy time for the IMF. Two crucial meetings have been put in the diary – one with Tunisia, and one with Egypt (again).
The two potential deals have a lot at stake, and not just in monetary terms. Tunisia’s possible $1.7bn loan will help shield the country from the European downturn. Egypt’s on-off $4.8bn loan is even more important, as it should unlock other sources of funding, and avert what could become a complete collapse of the economy. Read more
Inflation is on the rise in the Middle East and north Africa, bringing risks to consumption-driven growth and adding to political strains in the transitional countries least able to cope with them. Read more
Escalating disputes between labour unions and employers in north Africa are threatening to derail economic recovery after the uprisings that ousted long-ruling dictators in the region, writes Farah Halime.
Emboldened by the spirit of political change, thousands of workers in Egypt and Tunisia have staged a series of protests and are now in deadlocked talks with companies over demands for a minimum wage. Read more
Economies in north Africa have suffered a sharp drop in direct foreign investment since last year’s Arab uprisings, and they have been hit hard by the eurozone crisis. What can they do to rekindle investors’ interest?
Libya barely has a functioning government. Armed militias that overthrew Muammer Gaddafi last year still roam the land. And some eastern Libyans want to bolt from the union. But people still have to eat…
Despite political and security worries, Tunisia’s largest food retailer has announced plans to expand operations into Libya. Monoprix Tunisia, an affiliate of the French supermarket giant, will begin opening 10 new stores this year in Libya, the company announced last week, according to the official Tunisian news agency. Read more
Construction of Tunisia’s first-ever privately owned oil refinery will begin later this year with an investment by Qatar, which has been busy buying up properties in north African states emerging from a year of political tumult.
The state-owned Qatar Petroleum Company agreed years ago to build the refinery, just outside of Tunisia’s industrial port city of Sfax. But the deal was only set to be finalised on Sunday, according to Kuwait’s official news agency. Read more
More evidence, as if it were necessary, of the damage done to tourism by the unrest in North Africa and the Middle East. Tui Travel, the UK-based operator, on Tuesday reported a £23m increase in its operating losses for the three months to December.
The blame was put squarely on North Africa, with French travellers, in particular, staying away in droves from their traditional winter sunshine haunts. But Tui is taking this in its stride: as expected, it is doing much better than rival Thomas Cook, where the impact of North Africa has been compounded by financing challenges. Read more
By Lina Saigol
After coming top among emerging market equity fund managers in 2011, executives at Tunisian financial services company MAC be forgiven a little boast. Their shariah-complaint MAC al Houda beat the world’s best in 2011 – and they expect another good result in 2012.
“The fund is expected to perform well next year also, given the expected recovery of the Tunisian economy,” says Salma Zammit, one of MAC’s senior investment analysts. With the new government aiming to modernise Tunisia and create in Tunis a hub for Islamic finance, it could be a matter of being in the right place at the right time for MAC. Read more