The North Africa Country Series: The Republic of Tunisia

As part of its initiative to introduce non-conventional markets to Pakistani businesses, the Pakistan Business Council (PBC) in 2019, has initiated the North-Africa Country Series. The North Africa Country Series features four countries; Algeria, Egypt, Morocco and Tunisia. This profile of the Republic of Tunisia is the third in this series.

Tunisia is the smallest country in North Africa located between Algeria and Libya along the Mediterranean Sea. In the 8th century, Tunisia was conquered by Arab Muslims, followed by Ottoman Turks. The French took over in 1881 and Tunisia became a French protectorate with the French taking control of economic and foreign affairs. This continued till Tunisia’s independence in 1956.

The tertiary sector of Tunisia accounts for 63% of the GDP, the secondary sector 26% and primary 10%. Following the Arab Spring, unemployment (15.00%) and inflation (5.00%) have remained high. Moreover, Foreign Direct Inflows have also declined and these stood at USD $809.70 Million in 2017. This has resulted in a general slowdown of the economy with annual growth declining to 1.96% in 2017 from 2.88% in 2013.

Tunisia's Trade Balance with the World

As can be seen from the figure above, over the past ten years Tunisia has had a trade deficit with the World and which reached $6.42 Billion in 2017. Between 2008-2017, Tunisia’s imports from the world fell by 16.31% compared to a decline in its exports to the world of 29.98%. this led to overall increase of 20.68% in Tunisia’s Trade deficit.

The European Union (EU) is Tunisia’s most important export destination and accounted for approximately 75% of its exports in 2017. France, Italy and Germany are Tunisia’s top export partners. On the import side Tunisia’s top 3 partners in 2017 were Italy, France and China. Imports were dominated by electrical machinery, mineral fuels, machinery and vehicles.

In 2017, Pakistan had a potential to export $1,343.34 Million worth of goods to Tunisia with Pakistan’s high potential item being denim. Tunisia on the other hand had an export potential of $1,699.89 Million worth of products to Pakistan. High potential items included machines for reception, phosphoric acid and cabinets. Currently, Tunisia’s exports to Pakistan include, chemicals, vehicles and made-up textiles whereas cotton, man-made staple fibers and cereals were major imports from Pakistan.

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