Weathering An Economy Under Strain

In this oped, international expert and a TAYP member Hedi Larbi, shares its quick overview of the current economic situation in Tunisia. Based on our various foreign consultations with foreign investors and governments, it seems that the international community and investors still believe that Tunisia is the most promising Arab country in developing a democratic political system. Some recent goods news have supported this view, including the moderate rebound in the tourism sector, the positive economic growth posted in the first quarter of 2012, and the sound monetary and financial management of the crisis by the Central Bank.

While recognizing the real progress in the transition process, the international community remains anxious about and concerned by a number of issues. These include among other things the slow pace of preparation of the new constitution, the absence of a firm time-bounded roadmap leading to a stable democratic post-transition era,  the reluctance of the government to implement few priority structural reforms (governance, anticorruption, business environment, judiciary system, etc…), and failure to strictly enforce the rule of law (essence of democracy) leading to perceived impunity of violators of public order by some religious and non-religious groups and individuals. These concerns have overshadowed the transition in Tunisia and cooled off the support many countries and investors vowed to Tunisia.

We believe that the priority for the current interim government is to address the above concerns to restore public confidence, reassure investors, and pave the way for fast economic recovery and massive job creation which could tremendously facilitate the transition to the stable, democratic and prosperous era that all the Tunisians are aspiring to.

In the next issues of the newsletter, we will elaborate on the economic policy issues Tunisia should focus on, if it is to embark on a higher growth path which creates the quality jobs people are awaiting for. Click here to read the entire paper

Hedi Larbi is Country Director Middle East Department at the World Bank and TAYP member