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Tunisia works to halt a downward economic spiral

A year after the fall of the previous regime, Tunisia is undergoing an unprecedented political transformation. A transition government has led the country to the successful election of a constituent assembly. A new government has already been appointed, marking the second phase of the transition process, which is focused on drafting a new Constitution and reforming the country’s economy.

However, the only way this momentum will continue is if those in power are willing to include all national stakeholders in tackling the nation’s challenges. While these major political developments are taking place, the reality of growing economic problems and social instability is of increasing concern. Recent news about the economy is worrying not only politicians but also the Tunisian public in general.

Recently, the Central Bank announced a growth rate of zero for 2011 (down from an average of about 4 percent in recent years), more than 80 international companies have left the country and investment has declined significantly. These big-picture economic realities have translated into unprecedented unemployment figures, affecting 1 million individuals – around 20 percent of those eligible to work. This has resulted in greater numbers of Tunisians living in poverty.

As a consequence of these developments, several demonstrations have been organized by the unemployed, especially university graduates. These protests have sometimes resulted in the closing of factories, which has led to shortages in certain products. Employment was thus placed at the forefront of the debate during the Tunisian election campaign, with every candidate putting forth proposals to tackle the country’s economic downturn.

It falls on the shoulders of the newly elected government to fulfill the promises they made and pull the country out of this downward spiral. The new government is led by Al-Nahda, an Islamic party which won 40 percent of the vote in the fall elections and which has formed a coalition with two secular parties. Under Tunisia’s pluralist system, other parties that won a percentage of the vote are also represented in the country’s Constituent Assembly.

During the election campaign, many parties promised quick fixes and somewhat unrealistic solutions to economic problems. However, the problems of the Tunisian economy are mainly structural and need to be addressed at this fundamental level in order to be resolved. This means strengthening the country’s industries so that they can employ more qualified people, improving infrastructure in underdeveloped regions to attract foreign direct investment, reforming the tourism sector to shift the image of Tunisia away from a “low budget destination” and developing a national strategy for the agricultural sector.

Improving Tunisia’s economy should not be a partisan issue. All national stakeholders, as well as international or regional organizations, such as the African Development Bank, the World Bank and the European Union, should be consulted and encouraged to participate in this tremendous revival effort.

It is necessary for the governing coalition to invite key stakeholders to actively engage in the reform process. No successful effort can be undertaken without the participation of the large and influential Tunisian General Labor Union, the Tunisian Union of Industry, Commerce and Handicrafts and the various associations for tourism, agriculture, engineering and banking – to name a few.

Many of these national groups, however, are in disagreement with Al-Nahda’s approach of politicizing economic reform. Al-Nahda should therefore initiate a dialogue with them so that they can collaboratively solve economic problems and allow Tunisia’s leaders to develop solutions. Similarly, these stakeholders must be willing to engage with Al-Nahda.

Because the current government will be in charge for only 12-18 months – which is roughly the time it will take to develop a new Constitution – its best chance for success in improving the economy is through inclusion. That means bringing together the key players in Tunisia – state economic structures, political parties, trade associations, unions, civil society, universities and those in academia – with traditional international partners for a participatory approach to solving this crucial challenge.

Engaging all of these partners will be possible only if the new decision-makers in government decide to take an inclusive approach and build on the massive democratic momentum that Tunisia now enjoys.

Amine Ghali is the program director of the Al-Kawakibi Democracy Transition Center. THE DAILY STAR publishes this commentary in collaboration with the Common Ground News Service (www.commongroundnews.org).

A version of this article appeared in the print edition of The Daily Star on February 15, 2012, on page 7.
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Tunisia economy / tunisia growth / Tunisia
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