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Smuggled Libyan oil fuels Tunisian economy – and instability

File - Inhabitants of the village of the southeastern Tunisian town of Ben Guerdane march during a general strike on March 31, 2014 after the closure of the Tunisia-Libya border. (AFP PHOTO / JAWED NASRI)

BEN GUERDANE, Tunisia: Anger has been brewing in Tunisia’s smuggling hub of Ben Guerdane since the closure of its main border crossing stemmed the contraband Libyan petrol trade that fuels the local economy.

Faced with an increased number of vehicles loaded with cheap fuel exiting its western borders, the Libyan government decided to close the Ras Jedir crossing in early March, Tunisian officials say.

Officially, Tripoli said the border post was closed by “mutual agreement” pending “security guarantees” for Libyans living in Tunisia.

Protests have since multiplied in nearby Ben Guerdane, resulting in a general strike Monday that brought the coastal town in southeast Tunisia to a standstill.

Trafficking has flourished in Tunisia in the aftermath of its 2011 revolution, while lawlessness has been rife in oil-rich Libya following its own revolt the same year.

In a report published in December, the World Bank estimated that informal trade with both Libya and Algeria cost Tunisia at least 600 million euros ($828 million) annually in lost revenues.

According to the report, 20 percent of the active population in the Ben Guerdane region works in informal trade, making it “one of the largest employers (if not the largest) in the region.”

In Ben Guerdane, discontent has been aggravated, according to protesters, by the Tunisian army’s destruction last week of dozens of vehicles used to smuggle goods through the desert south of Ras Jedir.

“These people no longer have enough to live on since the border post was closed,” Ridha Mahdhi, who heads a Tunisian-Libyan friendship association, told AFP.

He said the smugglers had been bringing Libyan fuel through the crossing largely unhindered, but were forced to find alternative routes when it was shut.

“And because the desert tracks they’ve been following lead through a military zone, the army ransacked 67 vehicles,” Mahdhi added, a claim that could not be verified.

One smuggler, giving his name as Ali, said the Tunisian military would allow them into Libya but then “attack and sometimes loot” their cars on the way back.

A Tunisian security source said the smuggling operations benefited the border authorities, who received a cut from every passing vehicle.

“They go through Ras Jedir and pay a bribe, or even ‘hire’ the cars of customs officers so that they can do two or three trips a day,” the source told AFP, requesting anonymity.

Merchandise smuggled into Tunisia from Libya includes food and manufactured goods, which all earn tidy profits for the traffickers and still undercut Tunisian market prices.

But petrol reaps the biggest reward, with a liter bought in Libya at around 8 cents going for around 50 cents ($0.69) in Tunisia, still 30 percent less than at the pump.

The business has turned into an economic lifeline for Ben Guerdane, which like many other parts of Tunisia suffers from persistent unemployment and lack of investment.

With so many people depending on smuggled Libyan goods to support their families, riots broke out in Ben Guerdane when the border was closed in January.

“This type of trade has an important economic and social impact in border regions. In many of these regions, informal trade is one of the most important economic activities,” the World Bank said.

Khalifa, a public sector worker, said the fact that trafficking supported the majority of people in the region was unlikely to change.

“It’s not a secret, and the practice won’t stop as there are no factories or projects to create jobs,” he said.

But Tunisian Prime Minister Mehdi Jomaa, whose technocrat administration was appointed two months ago, pledged to eliminate trafficking and parallel trade during a visit to the southeast region in early March.

He said they caused “huge losses” to the Tunisian economy, according to an official statement, which gave no details of planned alternative measures.

 
A version of this article appeared in the print edition of The Daily Star on April 03, 2014, on page 5.

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Summary

Anger has been brewing in Tunisia's smuggling hub of Ben Guerdane since the closure of its main border crossing stemmed the contraband Libyan petrol trade that fuels the local economy.

Trafficking has flourished in Tunisia in the aftermath of its 2011 revolution, while lawlessness has been rife in oil-rich Libya following its own revolt the same year.

In a report published in December, the World Bank estimated that informal trade with both Libya and Algeria cost Tunisia at least 600 million euros ($828 million) annually in lost revenues.

Petrol reaps the biggest reward, with a liter bought in Libya at around 8 cents going for around 50 cents ($0.69) in Tunisia, still 30 percent less than at the pump.

Tunisian Prime Minister Mehdi Jomaa, whose technocrat administration was appointed two months ago, pledged to eliminate trafficking and parallel trade during a visit to the southeast region in early March.


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