Tunisians uncertain about EU free trade agreement
2008-01-07
Tunisia opened up a promising new market by entering the Free Trade Zone Agreement with the European Union, but some business and political leaders caution that without protection and modernisation measures, the economic gulf between Tunisia and the EU could get worse, not better.
By Jamel Arfaoui for Magharebia in Tunis – 07/01/08
![[Jamel Arfaoui] Tunisian businesses will have to adapt to the new economic conditions.](/cocoon/awi/images/2008/01/07/080108feature1photo.jpg) [Jamel Arfaoui] Tunisian businesses will have to adapt to the new economic conditions. |
The last remaining customs barriers between Tunisia and the EU were lifted when the Free Trade Zone Agreement became effective January 1st, but Tunisian opinion remains mixed over the measure.
Noting that Tunisia is the first south Mediterranean country to establish a free trade zone with the EU, Businessmen's Association Secretary-General Hedi Jilani said the country has entered into a new stage "full of challenges and rich in promises and ambitions".
Other business and political leaders, however, are less optimistic. Private enterprise director Moncef Mouallehi told Magharebia that the "agreement will be detrimental to the labour market in Tunisia, and the number of unemployed people will increase". Mouallehi added, "Tunisian consumers will seek foreign commodities and will forget our local commodities".
The Democratic Union Party concurs with the opinion that the agreement will only serve to widen the economic gulf between Tunisia and the EU. In an editorial, the opposition party newspaper warned, "[This] situation doesn't serve…Tunisian products", adding that "in the absence of protection, Tunisia and similar countries will be just a market to consume all the products of European industrial machine whenever the citizens have the means and purchasing power."
It would have been better were a free trade agreement "on the level of the Arab Maghreb countries or the Arab region" to have preceded the EU partnership, the party argued. The agreement with Europe would have thus "involved the entire region [and provided] much better negotiation conditions."
The free trade zone between Tunisia and the EU is a "double-edged weapon", said Young Leaders' Centre director Monia Jeguirim Essaidi. Tunisian enterprises will now be able to effectively promote their products within Europe, but only if they modernise their processes. If Tunisian businesses "continue with their traditional, out-of-date methods", Essaidi told Magharebia, "they [will] shrink and then wither away; something that would result in more difficulties in the job market and economic life in general".
According to informed sources speaking to Magharebia on condition of anonymity, Tunisian authorities may resort to raising consumption tax. In exchange, Tunisian consumers would have more choices in the local market, especially of industrial materials and domestic electrical appliances. This would force local manufacturers to improve the quality of their products and to offer them at competitive prices.
Economic experts say that to further boost its economic and trade integration into the Euro-Mediterranean sphere, Tunisia will also try to benefit from bilateral free trade agreements concluded with Morocco, Jordan, Turkey, the European Association for Free Exchange (Norway, Switzerland and Iceland) and the Agadir Agreement with Morocco, Egypt and Jordan. This is in addition to its ratification of the Pan-Euro-Mediterranean protocol on rules of origin. Tunisia faces an important deadline set by the Barcelona Declaration, which aims at establishing a Euro-Mediterranean free trade zone by 2010. This would open an area of more than 700 million consumers.
Negotiations are still under way regarding products in the farming sector for the new Freone agreement with the EU.
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Adam Smith Posted 2008-01-07
Why weight the negative aspects of free trade so heavily as is done in the article? With the agreement, Tunisia will benefit from import of products that can be produced cheaper in Europe and can focus its productive capacity on areas where it is more competitive (olive oil would be one). Of course, with the free trade agreement, the Tunisian government would want to start the process of free movement of labor between Tunisia and the EU as a natural next step.
boualiane ahmed Posted 2008-01-08
Hi to the Entire Publishing Team, These agreements are not in the interest of the people of the Maghreb. The Europeans want to channel these potential markets into a terrain that is profitable for their interests, taking into account what has transpired in the developing countries (China, India, Brazil). And, we. the people of these other countries, are not able to admit what is going on, despite having so much in common, e.g. language, location, etc. We need to negotiate an economic union in the United Arab Maghreb.
azza Posted 2008-01-13
It is too late to worry now: the agreement was signed back in 1995. At that time you had the right to be concerned, but now what is done is done. Several companies have been able to protect themselves through designed to improve Tunisian companies’ ‘competitiveness’ when faced with giant European multinational companies. Indeed, the problem is also in the Tunisian mentality; it always searches out foreign products for their reputation (e.g. quality and price). Tunisians presently do not have confidence in their national products. Resultantly, companies that have not yet prepared for this increased competition, are clearly going to have some difficult problems to overcome. In the context of the EU, if it is not already so, their fate is but to be ‘a business in a difficult economy’ or to close their doors. In any case, the result is the a same: this will close the doors of hundreds of licensed businesses and exacerbate the problem of unemployment.
haikel Posted 2008-02-19
What benefits are you talking about!? Tell me what benefits this agreement to export our industrial products brings us!!! Excuse me, but how does Tunisian industry weigh in next to that of Germany, Italy or France, not to mention the European Union as a whole? And, what of the exportation of agricultural foodstuffs? Are we going to benefit from export quotas that are never achieved (with the exception of dates and olive oil, both of which have been encouraged since the 1950s)!? How is this agreement going to change this fact!!!??? Of course, businesses are going to come here and work and it is true that our workers will find jobs. But, it is also true that our higher-trained people are unemployed. Faced with competition from European products, I assure that it will become more and more difficult to create new Tunisian businesses!!! In the final analysis, the Tunisians are going to remain workers for the Europeans and these workers are going to use the salary the European pay them to buy European products. I guarantee you this. Let us hope I am mistaken!
Abdul'azeez Saliau nAbubakar Posted 2008-04-09
Hi please i need to now the best develop between tunisia and egypt and the comparism of their economic.
zied Posted 2008-05-19
To get a pretty clear idea about this, I invite you to consult either the World Competitiveness Center’s report from the 2006-2007 World Economic Forum held in Davos or to read the different articles about Tunisia that comment on this report. Sincerely,
nour Posted 2008-06-05
Why are we so afraid of this agreement? Is it because we do not have faith in Tunisian companies? And, why do Tunisian citizens prefer foreign products? Is it because they are not satisfied with local products? Does the problem concern the quality of the product, its design or its price? Who can answer these questions? Whatever the response may be, will the problem remain tied to Tunisian companies? What are the real problems with Tunisian companies? What are the real solutions? In my opinion, if we presented a Tunisian citizen with a Tunisian product of good quality and price, he would be happy to buy it.
daniel s Posted 2010-01-23
It seems strange to me that so many of you are against the free trade deal? Two or three of the above posters question what does tunisia stand to gain from it? I would have thought that it was self explanetory? More jobs, more gainfully employed means more revenue coming into the country, I.e. The country becomes richer, yes there may be a subsequent brain drain as more experienced and skilled people leave, But this has also proven in the region to increase national revenue as these people send money back home. (Zmegry). How can tunisia compete with germany, italy or france? Easy considerably cheaper labour whilst maintaining relative proximity. Or maybe you all just want a magic wand to be waved and tunisia leap frogs all these neccasary steps of its evolution? Finding huge national resources only makes the rich richer and takes many, many many years to filter down and create a Middle class in society, never mind reach the working classes. Encouraging local manufacturing, I mean seriously protecting and boosting manufacturing is not only the best way to start The required changes in tunisia but it is the most effective method of ensuring that those who need help get it first. Finding jobs for the highly skilled not only takes time but is also less likely to be fulfilled by not having the FTA Than by having it, when we are talking jobs of this level free labour movement is proven to help further training, research and development. This is without taking into consideration the extra training and experience that will be made available by allowing them access to training and work placements in europe. Jobs at certain levels are required and not all at the top, we cannot rely on taxes alone to redistribute wealth or else all of society would be deficient
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