Tuesday, April 28, 2015

Tunisia's new government committed to welcoming foreign investment

Photo by Beau Finley
Tunisia is “a bright spot in the region,” declared World Bank President Jim Yong Kim in his opening remarks at the World Bank/International Monetary Fund annual spring meetings in April.

Despite the many economic hurdles and security challenges that continue to face Tunisia, hope for the country that inspired the regional Arab Spring remains strong. The legacy of Tunisia's Jasmine Revolution shows far more promise than similar uprisings in Libya, Yemen and Syria, where visions of better governance have largely faded and been replaced by violent conflict.

Beji Caid Essebsi was inaugurated in January as Tunisia's first freely elected president. He and Prime Minister Habib Essid have pledged to protect the freedoms gained since the 2011 revolution and to move a united Tunisia forward. 

In order for Tunisia to remain "one of the bright spots," the World Bank head earlier this month advised the new government to continue to implement necessary reforms initiated a year ago by the interim government.

“That’s our plan,” Yassine Brahim, Tunisia’s Minister for Development, Investment and International Cooperation, said in response to the bank’s recommendation, telling me “that’s the right path for the country.”

Brahim believes that he and other government officials have the chance to effect real change. While the caretaker government succeeded in ensuring a smooth political transition, it lacked the legitimacy and the time in office necessary to implement needed reforms. The new government, Brahim observed, is well situated to make those changes.

In May, the prime minister will present a 100-day status update, demonstrating a commitment to government accountability that was lacking under the regime of President Zine al-Abidine Ben Ali.

Each government ministry has been tasked with identifying its five top priorities. Economic revitalization, unsurprisingly, underlies many.

For Brahim, the top priority was reforming the Investment Code. He believes the new Code will have the biggest impact on Tunisia's economy in the long term. "The idea is that, as always, to create jobs, to create opportunities, we need to have investments."

The new Investment Code is expected to ease the process of foreign investment and reduce regional economic disparity by driving investment in the disadvantaged areas.

In addition to reforming the Investment Code, Brahim said he is also focused on accelerating existing projects, creating a transparent information system that tracks the status of the country's large projects, converting debt and investment in some public companies, and submitting the final figures from a recent country-wide census.  

Brahim underscored the necessity of government transparency in all of these endeavors. He lamented that corruption has worsened since the Ben Ali era. The establishment of the government was the first step, he said, but noted that controls must be put in place and alternative incentives offered.

It is important, he emphasized, "that citizens can see that things are changing." 

The civilian role in Tunisia's economy cannot be overlooked, cautions Houssem Aoudi, a young Tunisian entrepreneur and co-founder of Cogite coworking space. 

"Since the revolution there is a new spirit that work needs to be done to improve the country and to salvage the economy," Aoudi wrote in an email from Tunisia. 

Cogite, he explained, was founded in response to a lack of government-led solutions to address unemployment and a broken economy. The three Cogite sites bring changemakers together in a collaborative environment. 

"Entrepreneurs have a big role to play by using their motivation and their creativity to create solutions... and not wait for government or other actions to intervene," says Aoudi whose message to the government is: "set up the field and let the private sector play its role."

Brahim akcnowledges that Tunisia is not sufficiently welcoming of domestic and international entrepreneurs. "We are working on it," he said, adding that he hopes government reforms will demonstrate to entrepreneurs the seriousness of government efforts to change Tunisia's economic future. 

Amir Ben Ameur, a Tunisian youth activist and president of WeYouth, echoes the call for greater civilian engagement. "Civil society is the corner stone of any new-born democracy and that is the only way to ensure sustainability and accountability."

Young Tunisians drove the 2011 revolution but, Ben Ameur points out, "unfortunately, the state is still unable to create sufficient job opportunities for the unemployed, especially university graduates." 

According to Tunisia's National Institute of Statistics, unemployment in 2014 was 15.2  percent, an estimated 40 percent of whom were young people. 

Ben Ameur says his organization, WeYouth, seeks to put youth in touch with the government so that they can have a voice. 

"We organize roundtables and panels with governmental representatives, parliament officials and local authorities' representatives so that they respond to the people's concern." 

Ben Ameur believes that such engagement can also help deter radicalization, noting that "the lack of jobs and the fragile education system which does not involve the student in civic engagement has, in a way, fueled the radical polarization."

A large number of Tunisians have joined the Islamic State and in March the terror group claimed responsibility for a deadly attack on the National Bardo Museum in Tunis. 

The minister for development, investment and international cooperation downplayed the impact of such terrorist elements on the country's overall economy. Alluding to the terror attack on the offices of satirical magazine Charlie Hebdo in Paris in January, Brahim said that "everyone is concerned [about terrorism]."

Tunisia must also confront insecurity at its borders with war-torn Libya and Algeria. But even here, Brahim sees possibility. Tunisia and Algeria are exploring "how we can complement each other" in terms of trade. "Libya," he acknowledges, "is a bit more complex now. But we wish that they will find an agreement, a national dialogue and if they find an agreement with dialogue, there is a lot to do in Libya."

When asked how the Tunisian delegation's visit went during the World Bank and International Monetary Fund's annual meeting, Brahim expressed appreciation for the continuing support but said "we need a breath." 

The political and economic reforms, while necessary, take time to reap benefits and, Brahim conceded, come with a cost. "They have political cost, they have social cost, they have financial cost, and they don't pay on day one... In the meantime, we need support."