Tunisia predicts increased economic growth and job creation

Describing this year's economic performance as "good", Tunisia's development minister was in upbeat mood late July, predicting increased economic growth and job creation.
Meanwhile, a major new loan from the African Development Bank and agreements with its Maghrebi neighbours were also good news in Tunis.

Development and international cooperation minister Mohamed Nouri Jouini told July 24 that despite the gloomy international picture during 2003, Tunisia had performed well. Backing this up with some numbers, he said that GDP had shown a 4 % rise in the first quarter of this year, while exports had jumped by as much as 15.9 %. In addition, foreign investment in industry and services was some TND 350 mm in the first three months of 2003, a figure Jouini saw as above expectations given a general slow down in FDI internationally in the months leading up to the Iraq war.
Looking into his crystal ball, the minister then predicted 5.5 % GDP growth for the year overall. The year-end deficit and budget gaps he then predicted at 3.1 % and 2.4-2.5 % respectively.

Jouini then went on to list the government's economic priorities for the remainder of the year. One of the main ones was mobilising foreign funding of small projects in Tunisia -- a goal that remarkably seemed to be highlighted only a few days later with the July 26 announcement of an EUR 8 mm loan from the African Development Bank (ADB).
This loan was extended to Tunisie Leasing (TL) and is aimed at extending credit lines of between TND 20,000 and TND 300,000 to Small and Medium Sized Enterprises (SMEs).The government has a policy objective of creating 2 500 new enterprises a year from 2001-2006, part of its strategy for boosting economic growth and tackling the unemployment problem.

TL will use the money to finance equipment leasing deals with the SMEs. Those companies wishing to buy the equipment at the end of the fixed-term leasing contracts will also have that option. Leasing is considered by many in Tunisia as a good answer to some of the major problems facing SMEs created by a market where credit from banks is very expensive and difficult to obtain.
The ADB has long had a role in Tunisia, having committed some $ 3,739 bn to the country since it began operating here in 1968. With this leasing deal, it joins Amen Bank and la Banque de Tunisie as the third private sector financing project available for Tunisian SMEs.

Boosting foreign investment was also on the agenda when Tunisian Energy Minister Moncef ben Abdellah was in the Moroccan capital mid-July. Meeting with his Moroccan opposite number, Mohammed Boutaleb, looked into ways to boost economic cooperation between the two countries.
The most recent figures show bilateral trade on a steadily increasing curve. In 2000, this stood at $ 146 mm, rising to $ 182 mm in 2001. Areas for collaboration identified by the two energy ministers included rural electrification and oil exploration. On the former, July 9 saw Tunisia and the Arab Fund for Economic and Social Development agree a 30 mm Kuwaiti dinar loan for upgrading a power network in Tunis. This was the latest in a long line of loans from the Fund, which has concentrated on infrastructure development, previously financing educational and communications projects in Tunisia.

As for the latter, this also received something of a boost July 17, with the announcement of a Tunisian/Algerian joint venture between the two national oil companies. They are now to explore for Tunisian offshore oil and gas, after an agreement was signed by Algerian Energy and Mining Minister Chakib Khelil and Tunisian Industry and Energy Minister Moncef Ben Abdallah in Tunis.
It was reported that the company named Numhyd would be exploring the Kaboudia area, some 200 km east of Tunis, and would then have the rights to exploit any discoveries it made. Numhyd was set up by the Algerian state-owned oil and gas firm, Sonatrach, and its Tunisian counterpart, ETAP, with a capital of $ 778,816. The joint venture had earlier won an Algerian permit on July 7 to search and produce oil and gas in blocks 220A and 220B in the south-eastern Illizi province.

While such deals are obviously welcome -- and help the government towards its targets -- clearly there is also a need for plenty more where they came from. No doubt in the months ahead, the government will continue trying to take advantage of the country's unique position -- as an African, Maghrebi and Middle Eastern country.
Each region holds promise and people in Tunis hope that the government will enable all three to be fully addressed.