Tunisia: economy improving, political tensions

Summary: Tunisia cooperating with the IMF, rewarded with a World Bank loan. Political infighting, drawn into the Qatar vs. four dispute.

According to the IMF the Tunisian economy has done well this year with the highest growth since 2014, at 2.5% year-on-year supported by agriculture and exports; but risks to stability, especially inflation at 7.7%, have increased and “require a decisive response, complemented with measures to protect the poor.” The Tunisian authorities told the IMF in May that they would act swiftly on the urgent economic reforms which the IMF had called for. The priorities are reducing subsidies on fuel prices (which favour the better-off), containing the public sector wage bill, and a pension reform bill to pay for social security.

Last month fuel prices were increased by 4%, the third increase this year. On 28 June the World Bank approved a new $500 million loan to support economic reform, reportedly in recognition of Tunisia’s implementation of reforms. The loan is to be used to promote private investment and small business, while protecting vulnerable households. There are projects in energy, water, technology, environmental improvement including drainage, and youth employment projects in marginalised areas.

The British government is hiring an advertising agency M&C Saatchi to win support from voters for reforms which sparked large protests in the recent past (our posting of 23 January). The FCO has also somewhat relaxed its travel advice – big British tour operators had already relaunched holiday offers earlier this year.

Tunisia is one of the countries through which migrants pass on their way to attempt the Mediterranean crossing into Europe. On 2 June a migrant boat sank off the Tunisian coast with the loss of at least 68 lives. On 6 June Prime Minister Youssef Chahed dismissed the Interior Minister Lotfi Brahem; no official reason was given but a government official said it was “for failing to stop the boat and illegal boat migration in general.” In further signs of strain within the Nidaa Tunis (Tunisia call) party the senior partner in the coalition, the party leader Hafedh Caid Essebsi, son of the president, called for Chahed’s dismissal because of the government’s failure to revive the economy, and Chahed responded by accusing him of destroying the party.

Former Tunisian Interior Minister Lotfi Brahem

The conclusions of the European Council meeting on migration on 28 June did not mention Tunisia but according to Reuters EU leaders want to curb arrivals by working through Tunisia and other third countries, although the process is complicated and costly.

Tunisia has important relations with the wealthy Arab states, but as elsewhere these are bedevilled by the Qatar vs. four dispute. According to the Saudi Arab News Tunisia is taking steps to attract Saudi investment and tourism; the Tunisian minister of development is reportedly ready to establish partnerships especially with Saudi Arabia, Egypt and the UAE (all members of the group of four).

But according to a report in Le Monde Afrique the dismissal of the interior minister had nothing to do with the sinking of the migrants ship but was because he had planned a coup d’état in coordination with the UAE intelligence services; Brahem had also visited Saudi Arabia in February, returning in a private Saudi jet. The implied purpose would be to get rid of the coalition government in which the junior partner is al-Nahda, the Tunisian branch of the Muslim Brotherhood (anathema to the UAE and the four). We have commented in other postings on the difficulty of identifying fake news in these propaganda exchanges. In another twist the Union of Tunisian Imams has reportedly asked the grand mufti to discourage pilgrims from making the Hajj this year because of the high cost and the fact that the money is used by Saudi Arabia to pay for wars in other Muslim countries. al-Nahda has described this initiative as “isolated and ideological calls that only serve personal purposes.”

Finally, at link is a report of a rare example of religious tolerance, the joint celebration by some 5,000 Jews and Muslims of an annual festival in Jerba, as the author Francis Ghilès points out an extraordinary scene in the Mediterranean of 2018, but not extraordinary when set against the history of Tunisia.

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