Tunisia
has a 98 per cent Muslim population and Arabic is its
official national language. In recent yeards, the country's
relentless march towards a first world economic status
shows no signs of abating. If anything, the pace is quickening.
GDP growth this year is expected to hit the 6 per cent
mark. Following an average growth rate of around 5 per
cent for the last decade, this is a remarkable performance,
especially for a country with few natural resources.
Like
Mauritius, the other star in Africa's economic firmament,
Tunisia is reaping the rewards of its heavy investment
in human resources. Like Mauritius, it is using the skills
of its people to make things for which there is a high
international
demand. Unlike Mauritius however, Tunisia is situated
right in the heart of its principal market - the European
Union - to which it sends around 80 per cent of its exports.
Goods from Mauritius, on the other hand, which is located
far out in the middle of the Indian Ocean, have to make
the long haul to Europe and then push out even further
to reach the United States. It is this proximity to Europe
which is the key to Tunisia's economic thrust. But proximity
on its own means nothing ? as witness Tunisia's neighbours
in the Maghreb. It is making this proximity count that
has transformed this North African country of nine million
into a regional power house.
Pragmatic,
thoroughly thought out policies, and the energy and determination
to carry them through, lie at the heart of Tunisia's success.
Under the leadership of President Zine El Abidine Ben
Ali, every factor that could have slowed down or impeded
the country's development was thrown into the rubbish
bin; everything that enhanced development was nurtured
and encouraged. The result has been remarkable political
stability in a volatile region, the highest per capita
income and the best literacy rate in Africa, easily the
most qualified workforce on the continent and a superb,
modern infrastructure.
Given
such a fertile soil, it is hardly surprising that some
2,000 international companies have taken root in Tunisia.
This year alone, the country expects to attract another
$600 million worth of foreign direct investment. This
industrial muscle, added to the thousands of world-class
Tunisian enterprises, equals an African Singapore in the
making. Tunisia's immediate goal is to be fully prepared
for the 2008 free trade zone agreement with the EU. This
entails two separate challenges. The first is to upgrade,
modernise and increase physical infrastructure and the
second, perhaps more important, is to raise human performance
levels.
Both
strands of the strategy are well under way. Tunisia today
is a hive of furious activity. At least 45 major construction
projects, with a value of around $4.6 billion, are either
well advanced or nearing completion. Avenue Mohamed V
in Tunis, an elegant avenue with old-world charm, is being
transformed into a modern commercial artery with glittering
high-rise office blocks. A new, ultra-modern all-purpose
stadium is taking shape and will be completed in time
for the 14th Mediterranean Games later this year. A large
new marina is also approaching completion at the tourist
resort of Hammamet. Scores of other projects, including
flats, office buildings, factory shells, shopping malls,
hotels and leisure facilities such as golf courses are
under construction up and down the country. As you travel
around Tunisia, the phrase ‘building the future'
takes on literal meaning.
The
country is preparing itself for the larger volume and
faster pace of economic activity that the EU agreement
will entail. The Tunis-Carthage International airport
has already been expanded and road and rail networks are
increasing steadily. Berthing space and port facilities
are undergoing continuous upgrading. Today, there are
166 weekly flights to Europe and 20 sea-going departures.
Traffic by land, sea and air will increase year by year
until 2008 but the country's transport authorities are
confident they will have the capacity to deal with whatever
volumes come their way. The benchmark for a country's
economic development is the state of its telecommunications.
There is not much point in building massive infrastructure
if people cannot communicate easily, cheaply and effectively.
All business, at the end of the day, is the result of
person-to-person communication.
Tunisians,
who have known the value of effective communication for
thousands of years, need no second bidding.
The government announced that the number of telephone
lines have doubled to two million in 2004 and total investment
in the sector is expected to be around $225 million this
year. The network is fully digitalised. But this is only
the tip of the information technology revolution. The
number of Internet subscribers has leap-frogged from 30,000
on 1999 to over 150,000 this year. Mobile telephony is
also expected to show a sharp rise when a second GSM (global
system for mobile communication) operator is identified
later this year. In 2003, Tunisia allowed foreign telephone
service providers to enter the market. The net result
of these developments is that the cost of making telephone
calls has come down while the number of people with access
to telecommunications facilities is expanding at an astonishing
rate.
Tunisia
is one of the few developing countries to place such a
high priority on the state of the environment and land
development. Clear-sighted policies and a vigorous application
of regulations have resulted in Tunisia enjoying the status
of the cleanest 
country
in the southern Mediterranean. Apart from the positive
impact this has on health and tourism, it could become
a crucial competitive element when international environmental
regulations begin to bite in the near future. The current
international manufacturing giants, China, Taiwan and
Hong Kong are way behind in environmental management.
Unless they can get their environmental act together,
they could easily find themselves losing large chunks
of their present very lucrative markets. Investment will
then be forced to look for environmentally friendly manufacturing
bases. Tunisia has thus neatly placed itself in the front
row of such bases.
So
much for preparing the ground for the great economic leap
forward. What about the human factor? Is the average Tunisian
willing and able to live in the fast lane? The answer,
according to the World Bank, is a qualified yes. Tunisia's
investment in education is one of the highest in the world.
Some 92 per cent of six to 12 year-olds attend school.
Women now form a vital segment of the skilled workforce.
The universities produce 1,000 engineers every year. There
are 30 vocational training centres and seven institutions
of higher vocational training. Over the next few years,
virtually every school leaver will be computer literate.
There are already 5,000 computer experts in the country
and each year, an additional 700 engineers and business
computerisation managers join their ranks.
The
combination of these factors has produced easily the most
skilled and best qualified workforce in Africa (even including
Mauritius) - and one of the best in the southern Mediterranean.
More significantly in terms of international competitiveness,
the cost of labour is lower than in countries which are
Tunisia's main economic rivals. For example, the total
cost per minute for a textile manufacturer in France is
28 US cents; in Tunisia, the same manufacturer making
exactly the same product will pay only 10 cents. In Portugal,
one of Tunisia's main rivals, the manufacturer will pay
13 cents. A difference of three cents per hour on a turnover
of several million dollars per month can amount to a king's
ransom. No wonder virtually every household brand name,
from Adidas to Volkswagen, has a presence in Tunisia.
Interestingly,
lower labour costs do not translate into lower standards
of living. On the contrary, Tunisia has a higher proportion
of middle classes compared to other low-cost producers
such as Turkey, the Czech Republic, Poland, Hungary and
Portugal. A home-ownership rate of 78.2 per cent of the
population is higher, by far, than all the others.
Tunisia's spectacular economic growth is a classic case
of how to turn disadvantages into opportunities. The lack
of natural resources meant that unlike other Maghreb countries
such as Libya and Algeria, there were no ready-made sources
of income. Since there were no windfall revenues from
unexpectedly high commodity prices, there was no incentive
to squander money on prestige projects or indulge in grandiose
international gestures.
The
result is that Tunisia's foreign debt is negligible and
it has been able to pay all its commitments promptly.
Thus, unlike the majority of African countries, it has
not needed heavy-handed IMF or World Bank interventions
and has been able to chart its own development course
rather than have to swallow prescriptions imposed from
outside.
The
fact that virtually half of the country is desert has
made Tunisians highly appreciative of their green areas.
They have husbanded the fertile soil with extreme care
to ensure sustainability. The result is that the country
today is virtually self-sufficient in food. Plans to increase
agricultural output without putting additional strains
on the soil are already in process. The Ministry of Agriculture
is confident that over the next five to six years, food
output will not only meet total demand, but there will
also be a surplus for export.
Given
these natural constraints on economic growth, Tunisia
put all its chips on developing human resources. It was
a gamble that has paid off handsomely. But it has not
been simply a case of throwing money at education, creating
a friendly climate for investors and hoping for the best.
It took clear, cool planning and the establishment of
a state machiney to ensure that policy would be translated
into reality on the ground.
The
roots of Tunisia's achievements lie in accurately forecasting
future international trends. The country realised the
implications of globalisation well before many others.
It could see not only that markets were becoming more
international but that the entire production process itself
was being internationalised. The era of nationally based
production and consumption was coming to an end. Tunisia
realised that tariffs and other artificial barriers would,
sooner or later, have to go. Products would compete only
on quality and price, not where they were made.
Here
the Tunisians saw their opportunity. If they could position
themselves to become low-cost, high-quality producers,
they had the chance to rub shoulders with the big boys
in the industrial world. Their geographic position, at
the hub of the European, Arab and African worlds, was
their one great advantage over competitors. But to gear
up the country to become a major industrial player required
a wholesale transformation of society. It had to be a
'quiet revolution' and it had to be planned with meticulous
care. Several unconnected strands, such as the empowerment
of women, the increase of disposable incomes, the building
up of domestic capital, the creation of new infrastructure,
the training and retraining of the workforce, the projection
of a positive media image abroad and, above all, the psychological
change from conservatism to competitiveness had to be
developed separately and then brought together like pieces
of a jigsaw puzzle to form the complete picture. Preparation
has been the key.
Today,
the picture is almost complete, but some pieces still
have to be slotted in. Tunisia has indeed become a substantial
industrial player - industrial exports last year accounted
for around 80 per cent of exports. Textiles alone contributed
around 50 per cent of exports. Now Tunisia has embarked
on enlarging its international market share. It recently
organised a very well-attended exhibition and trade fair
for its textiles in Britain. These forays into hitherto
non-traditional markets are predicted to continue over
the coming years and, as the markets increase, so will
the productive capacity. This in turn will create more
jobs, more disposable income, more domestic consumption
and the cycle of prosperity will continue to corkscrew
upwards. The flurry of construction activity is yet another
piece of the jigsaw about to slot into the picture. Tunisia
is preparing for an even better tomorrow.
