Blueprint for wealth creation

Tunisia today is virtually unrecognisable from the country it was ten years ago. The economy has been growing at an average of 5.8%, inflation has been pegged down to 3.1% (1998), the budget deficit has been whittled down to 3% and is expected to hit a low of 2% by 2001, balance of payments deficit has stabilised at around 4.2% and external debt is no more than 17% of exports.

The change goes beyond statistics and is visible. Tunis and other major towns, Sfax, Bizerte and Sousse are spotless and function as efficiently as any Mediterranean European metropolis. Telecommunications and the postal system have been rationalised and are the most efficient in Africa.

The biggest change however is in the demeanour of people. The last 10 years have brought more and more people into the mainstream economy and Tunisia is now a true stakeholder society. The work culture has undergone a revolution and gains in productivity over the last five years have added a very impressive 30% to GNP The target is to increase this figure to 40% by the end of the current development plan in 2001.

However, unemployment at 15% is still worrying the country's planners. "If we can achieve growth of around 7% per annum, we should reach full employment over the next decade," says Taoufik Baccar, the Minister for Economic Development. Realistically though, the country has set itself a target of 6% per annum which will bring unemployment figures down to single digit numbers.

Meanwhile, several measures have been instituted to alleviate poverty and create jobs. The National Solidarity Fund has raised over $300m to provide decent amenities for marginalised groups and equip them with income generating capacity. The newly created National Solidarity Bank gives promising entrepreneurs very soft start up loans.

Several infrastructure projects, hitherto the sole province of the state, are now being offered to local and international firms. Labour intensive enterprises can obtain plots for a nominal sum of a little as TD 10.

All this adds up to a very robust economy, ideally positioned, both in terms of capacity and geographical situation, to confidently enter the euro zone in the first decade of the new millennium.

Tunisia's almost miraculous economic and social achievements since the change in 1987 are the result of "carefully walking the tightrope between ambition on the one hand and caution on the other," says Mohamed Ghannouchi, the Minister for International Cooperation and Investment.

"Right from the word go, when President Ben Ali assumed office, we set ourselves two main objectives: one, to improve the living conditions of the people and create jobs, and second to catch up with the developed countries. Both these objectives have been working in tandem over the last decade and I think we can claim a measure of success."

Linked to this was the need to liberalise what had been a very closed economy. "We set out to maintain high growth and gradually integrate our economy into the global economy. This called for substantial reforms and a period of adjustment, says Ghannouchi. "So far, we have been able to carry out reforms without either slowing down growth or causing social unrest." Tunisia is currently ranked second to Mauritius as the most liberal economy in Africa.

Lacking substantial natural resources such as oil or minerals, Tunisia set about making the most of whatever advantage it had and also converting minuses into pluses. "Part of our strength lies in the fact that we do not depend exclusively on the export of primary raw materials and do not suffer from excessive foreign debt. We tend to depend on ourselves," says Taoufik Baccar, Minister for Economic Development.

This desire for self-sufficiency translates into the ingenious use and careful husbanding of whatever resources are available. Take agriculture. Tunisia has only Sm hectares of arable land distributed over a wide area in the north and central regions. Agriculture is very rain dependent and production can vary considerably year to year. Nevertheless, Tunisia is virtually selfsufficient in cereals, edible oils, market vegetables and, last year, attained self-sufficiency in milk and dairy products.

A series of cleverly contrived systems allows 340,000 hectares to be irrigated. "This is only 7% of the total arable land but it produces 22% of our cereal output and as much as 85% of market fruit and vegetables," says Baccar. By 2006, an additional 60,000 hectares will be under irrigation. "Give me the Nile or the Mississipi and I'll feed the world," says Badr Ben Ammar, Director of Planning in the Ministry of Agriculture.

Although Tunisia does not have the Nile, it has the desert. More than half the country is, in fact, desert. This minus has been turned into a plus by aggressively developing tourism in the south. Several international films, including Star Wars and The English Patient have been shot in the south. The revenue has been used to extend road and air networks and support the construction of hotels and other tourist facilities. The desert is rapidly becoming a `must visit' destination for European and American tourists looking for something off the beaten track.