RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/TPR/G/152 
7 September 2005 
 
 (05-3818) 
Trade Policy Review Body Original:  French 
  
 
   
 
TRADE POLICY REVIEW 
 
Report by 
 
TUNISIA 
 
   
Pursuant to the Agreement Establishi ng the Trade Policy Review Mechanism 
(Annex 3 of the Marrakesh Agreement Establishing the World Trade 
Organization), the policy statement by Tunisia is attached. 
 
 
Note: This report is subject to restricted circ ulation and press embargo until the end of the first 
session of the meeting of the Trade Policy Review Body on Tunisia. Tunisia WT/TPR/G/152 
 Page 3 
 
 
 CONTENTS 
 
Page 
I. INTRODUCTION 5  
(1) A N ECONOMY OPEN TO THE OUTSIDE WORLD  5  
(2) A  DIVERSIFIED ECONOMY  5  
(3) R APID AND SUSTAINED GROWTH  5  
(4) S OUND ECONOMIC FUNDAMENTALS  6  
(5) H IGHLY QUALIFIED HUMAN RESOURCES  6  
(6) A N ATTRACTIVE ENVIRONMENT FOR PRIVATE INVESTMENT , 
ESPECIALLY IN SERVICES  7  
II. INTEGRATION OF THE TUNISIAN ECONOMY INTO THE WORLD 
ECONOMY 7 
(1) FREE TRADE  7  
(2) TRADE THAT CONFORMS WITH THE RULES AND PRINCIPLES OF THE WTO 8  
(3) SUCCESSFUL REGIONAL INTEGRATION  8  
(4) PROGRESSIVE REDUCTION OF TARIFF PROTECTION  9  
(5) A STEADILY IMPROVING TAX SYSTEM  10  
(6) A TEXTILES AND CLOTHING INDUSTRY ADAPTED TO THE NEW INTERNATIONAL 
MARKET CONDITIONS  10  
(7) SERVICES :  ENGINE OF DEVELOPMENT AND SPRINGBOARD FOR  
THE EMERGENCE OF A KNOWLEDGE ECONOMY  11  
 (i)  Information and communications technology:  a modern, high-
quality, high-speed and multiservice infrastructure 11  
 (ii)  A financial sector in process of reorganization 12  
 (iii)  Transport:  a sector open to private investment 12  
 (iv)  Tunisia, a high-quality tourist des tination with a diversified supply 14  
 (v)  Professional services and business services: activities with a strong 
export potential 15  
(8) AN AGRICULTURE LESS DEPENDENT ON THE WEATHER AND AT THE SERVICE OF 
THE RURAL COMMUNITY  15  
(9) BETTER PROTECTION FOR INTELLECTUAL PROPERTY RIGHTS  15  
(10) WHAT TUNISIA EXPECTS FROM THE WTO  NEGOTIATIONS  15  
 (i)  Access to markets for non-agricultural products 16  
 (ii)  Trade in services 16  
 (iii)  Agriculture 16  
III. TUNISIA’S FUTURE STRATEGIC CHOICES 17  
(1) A PROACTIVE FULL EMPLOYMENT POLICY  17  
(2) PRIVATE INVESTMENT IN INNOVATIVE ACTIVITIES  17  WT/TPR/G/152 Trade Policy Review 
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 Page 
(3) TOWARDS COMPLETE CONVERTIBILITY OF THE TUNISIAN DINAR  18  
 (i)  Continuing reform of the tax system 18  
 (ii)  Pursuit of a prudent monetary policy 18  
 (iii)  Reform of the financial sector 18  
 (iv)  Advancement of the gradual process of achieving complete 
convertibility of the dinar and exte rnal financial liberalization 19  
(4) LAYING THE FOUNDATIONS FOR A KNOWLEDGE ECONOMY  19  
IV. CONCLUSION 19  
 
  Tunisia WT/TPR/G/152 
 Page 5 
 
 
 I. INTRODUCTION 
1. At the end of the 1980s, Tunisia, with few natu ral resources, adopted a development strategy 
based on integration into the world economy with a view to stimulating gr owth and improving well-
being.  A wide range of reforms, steadily and pr ogressively introduced and accompanied by sound 
macroeconomic management, has enabled Tunisia to  position itself more advantageously, to adapt 
harmoniously to the requirements of globalizati on and to benefit from an open and competitive 
economy. 
(1) AN ECONOMY OPEN TO THE OUTSIDE WORLD  
2. The application of the rules and provisions  of the multilateral trading system and the 
implementation, since 1996, of the free-trade area with the European Union (EU) and, since 1998, of 
the Greater Arab Free Trade Area (GAFTA) have enabled Tunisia to progress rapidly with the 
liberalization of its trade and to achieve an openness ratio (imports + exports of goods and 
services/GDP) of 96 per cent in 2004. 
3. The liberalization of investment since 1994 and the adoption of a proactive policy of 
attracting foreign direct investment have enabled Tu nisia to record a 9 per cent annual average rate of 
increase in FDI, with more than one third being earmarked for manufacturing industry. 
(2) A DIVERSIFIED ECONOMY  
4. GDP is relatively diversified.  Manufacturi ng accounts for 20 per cent and services for over 
54 per cent. 
Structure of GDP and rate of increase 
Sector Agriculture 
and fishing Manufacturing 
industry Non-
manufacturing 
industry Tourism Transport Communications Other 
services 
Percentage of 
GDP in 2004 14.3 20.2 11.4 6.4 6.3 4.1 37.3 
Rate of increase 
of value added in 2004 9.0 4.3 3.6 7.5 6.2 20.5 6.7 
Source:   Economic budget 2005. 
5. Between 1998 and 2004, exports grew strongly at an average rate of 12 per cent a year.  
During the period 2000-2004, they reached an averag e of 45.5 per cent of GDP as compared with an 
average of 42 per cent in 1990-91.  Alongside tourism, the manufacturing sector, which accounts for more than 50 per cent of total exports, and more pa rticularly the textiles and clothing sector, is the 
spearhead of this export drive.  Moreover, 24 per cent of exports consist of products requiring a high 
input of skilled labour and modern technology,  as compared with 21.2 per cent in 1997. 
(3) R
APID AND SUSTAINED GROWTH  
6. An improved business climate and a more competitive economy, together with 
macroeconomic stability, have made it possibl e to record rapid and sustained growth. WT/TPR/G/152 Trade Policy Review 
Page 6 
 
 
 7. During the decade which followed the structural  adjustment of the mid-80s, GDP increased 
on average by 4.3 per cent and growth rose from 5.2 per cent during the period 1997-2001 to 6 per cent in 2004.  In real terms, per capita  GDP rose by one third during the 90s. 
8. This growth helped to bring about a sharp reduction in poverty during the second half of the 
90s.  By 2000, only 4 per cent of the population was still living below the poverty line.  Poverty was 
reduced in rural as well as urban areas.  Consider able progress has been made in improving living 
standards:  life expectancy has increased, illite racy has been eradicated among the young, and 
electricity and drinking water have been brought to 98 per cent and 96 per cent of the population, 
respectively. 
(4) S
OUND ECONOMIC FUNDAMENTALS  
9. Maintenance of the principal balances is a c onstant feature of Tunisian economic policy.  
Prudent demand management made it possible to re duce the inflation rate from more than 6 per cent 
at the beginning of the 90s to an average of 2.4 pe r cent during the period 2000-2003.  For most of the 
90s, the structural current account deficit remained  at around 3 per cent of GDP.  It was brought down 
to 2 per cent only at the end of 2004. 
10. During the period 2002-2004, the budget deficit was reduced to average levels of 
approximately 2.4 per cent of GDP thanks to the efforts made to raise own resources and control 
budget expenditure and despite the pres sures characteristic of this period,  in particular, the decline in 
tax revenue due to tariff reductions. 
11. The implementation of a flexible exchange ra te policy towards the end of the transitional 
period of the FTA with the EU is helping to liber alize trade and preserve the competitiveness of the 
Tunisian economy. 
12. Tunisia has also adopted a prudent policy in re lation to debt management and controlling the 
burden of public debt.  In 2004, Tunisia's total exte rnal debt amounted to 50.4 per cent of GDP as 
compared with 52 per cent in 1999.  In recent year s, the debt service ratio has been brought down to 
less than 15 per cent of exports. 
13. In the last few years, it has been possible to bu ild up foreign currency reserves, thanks to the 
improvement in exports of goods and services and tight er control over the debt servicing level.  Net 
foreign exchange assets rose from 2 810 million di nars, or 74 days of imports, in 2001 to 
4733 million dinars and 107 days in 2004. 
14. Thanks to this performance, Tuni sia is one of the emerging countries to have earned the rating 
of investment grade.  Moreover, thanks to its prudent macroeconomic policies and greater 
creditworthiness, it has also gained easier access to international financial markets, enabling it to raise 
long-term loans on relatively favourable terms. 
(5) HIGHLY QUALIFIED HUMAN RESOURCES  
15. Tunisia has a skilled and productive labour force a nd internationally comp etitive wage levels.  
Thanks to the programme of educa tional reform, among those entering the labour market for the first 
time graduates represent more than half the a dditional demand for the period 2002-2006.  By 2016 
workers who have received a higher education will account for 23 per cent of the working population, 
as compared with 10 per cent in 2001, whereas the pe rcentage of less edu cated workers (primary 
education) should fall from 61 to 40 per cent. Tunisia WT/TPR/G/152 
 Page 7 
 
 
 (6) AN ATTRACTIVE ENVIRONMENT FOR PRIVATE INVESTMENT , ESPECIALLY IN SERVICES  
16. Emphasis has been placed on promoting private investment in the traditional sectors and on 
opening up new areas, such as transport, telecommun ications and higher education, to private sector 
participation, as well as on increasing the share of services, in particular, those with a high 
technological content and high value added. 
17. Accordingly, special attention has been paid to the various components of the investment 
promotion system both at business environment level and in relation to the business creating 
mechanisms.  The action taken has included su pport for competitiveness and business financing 
mechanisms and for improved relations betw een business and government.  The measures to 
encourage business creation have been mainly concer ned with financing investment by strengthening 
the venture capital investment companies (SICAR ), facilitating financial market transactions, 
improving the ability of businesses and banks to resort directly to the international financial market, 
encouraging production-related resear ch, and making the conditions a nd procedures for establishing 
new businesses more flexible. 
18. This combination of policies enabled the Tunisian economy to withstand the shocks 
experienced during the years 2002 and 2003, which we re marked by an overlapping set of adverse 
circumstances: the continuation of the four-year  drought, the prolonged impact of the events of 
11 September, the outbreak of war in Iraq, and th e slowdown in the economy and world trade.  During 
the years in question, these factors had a negative effect on the development of certain sectors, in 
particular, tourism and international transport.  Nevertheless, despite a slowdown, GDP (excluding 
agriculture) recorded an increase of  3.5 per cent in 2002, in particular thanks to services and more 
especially telecommunications.  Investment’s share of GDP amounted to about 25 per cent during the period 2002-2004. 
II. INTEGRATION OF THE TUNISIAN ECONOMY INTO THE WORLD ECONOMY 
(1) F
REE TRADE  
19. The consolidation of the principle of freedom of  trade and current transfers formed the basis 
for the reform of external trade.  It was firm ly established by Law No.  94-41 of 7 March 1994 and 
organized by means of a series of implementing texts published in August of the same year.  This reform was accompanied by a restructuring of th e trade-monitoring agencies and mechanisms which 
strengthened the role of the bodies and institutions responsible for conformity assessment and market 
safety.  Legislation on unfair import practices (d umping and subsidies) and on safeguard measures 
was adopted in 1998 and 1999, but has been used only to a limited extent. 
20. This process of liberalization has proceeded  at a pace sustainable both for businesses, 
simultaneously confronted with the loss of tariff pr otection as a result of the establishment of the free-
trade area with the EU, and for Tunisia's external balances. 
21. At the beginning of 2000, a new reform proc ess was launched with a view to facilitating 
external trade by reducing the time taken to complete foreign trade operations, rationalizing 
procedures and documents and reducing transaction co sts.  The first programme to be implemented 
(2000-2004) resulted in the establishment of an in tegrated system of electronic management of 
external trade procedures involving all the main stak eholders, in particular, customs, the banks, the 
Ministry responsible for trade and the Ministry of Transport.  A second facilitation programme was 
introduced at the beginning of 2005 as part of a huge export development project.  It involves the 
establishment of a customs risk management syst em, more transparent and effective standards, WT/TPR/G/152 Trade Policy Review 
Page 8 
 
 
 technical regulations and conformity assessment procedures, and a system for measuring trade 
efficiency indicators. 
22. Moreover, action has already been taken to fu rther simplify import and export procedures, 
harmonize the activities of the various department s concerned, rationalize the documentation and 
reduce the number of documents required.  The ongoing review of the Customs Code will make 
procedures more transparent, strengthen the right s of economic operators and make customs more 
efficient. 
(2) TRADE THAT CONFORMS WITH THE RULES AND PRINCIPLES OF THE WTO 
23. All the reforms implemented in the course of th e last ten years have been aimed, among other 
things, at fulfilling Tunisia's commitments to the WTO. 
24. Thanks to the transitional derogations for wh ich the multilateral trade agreements provide, 
Tunisia has been able to intr oduce these reforms at a pace adap ted to its economic and social 
development objectives. 
25. As an original member of the WTO, Tunisia is committed to the multilateral trading system 
and the establishment of a balanced and inclusive world economic order designed to promote growth 
and sustainable development. 
26. It considers the 2001 Doha Work Programme an opportunity to incorporate the development 
dimension effectively and operationally in the over all results of the multilateral trade negotiations.  
This dimension should form part of a global and coherent vision that enables developing and least 
developed countries to achieve integration in a gl obalized economy and take maximum advantage of 
the opportunities offered by the multilateral trading system. 
27. Convinced of the constructive commitment of all the Members of the WTO, Tunisia will 
spare no effort to ensure that this r ound is brought to a successful conclusion. 
(3) SUCCESSFUL REGIONAL INTEGRATION  
28. Tunisia considers that the processes of  multilateral and regional integration are two 
complementary and mutually reinforcing movements, inasmuch as the common objective is to 
facilitate trade liberalization by reducing and indeed progressively eliminating barriers to trade.  In 
conformity with the WTO Agreements, Tunisia is endeavouring to ensure appropriate interaction 
between the multilateral and regional systems, with  both development needs and the requirements of 
progressive liberalization and inte gration being taken into account. 
29. Tunisian trade has always been rooted in th e Mediterranean region with a heavy European 
component amounting to approximately 80 per cent of its total external trade. 
30. The Association Agreement between Tunisia and the European Union is a reflection of their 
close links, sustained and reinforced, among other thi ngs, by intensive and fruitful trade.  This is a 
bilateral global agreement which anticipated the Euro-Mediterranean partnership process inaugurated 
by the Barcelona Conference in 1995.  The free-trad e area forming part of this agreement is an 
extension of the special trading and economic rela tionship but, above all, an expression of Tunisia’s 
strategic decision to integrate more closely into the world economy and the Euro-Mediterranean area 
in particular, with a view to narrowing the deve lopment gap and improving the lot of the peoples of 
the Southern and Eastern Mediterranean. Tunisia WT/TPR/G/152 
 Page 9 
 
 
 31. Tunisia-EU relations will enter a new phase of development and in tegration with the 
implementation of the action plan agreed and adopt ed by the two partners in 2005.  Among other 
things, this action plan, an extension of the A ssociation Agreement, defines the main areas of 
cooperation at global economic policy and sectoral leve ls.  Several of its com ponents, in particular 
those relating to trade, incorporate a Euro-Mediterranean regional dimension. 
32. Tunisia, in conformity with WTO provisions , has concluded bilateral and regional trade 
agreements with a view to achieving a higher level of  integration into the world environment.  Thus, 
Tunisia is a member of: 
 - The Maghreb Arab Union (Tunisia-Algeria-Libya-Morocco-Mauritania), created on 
17 February 1989, which envisages the establishment of a free-trade area, as decided 
by the Council of the Presidency of the MAU in 1994; 
  - the League of Arab States (1947), wh ich has 22 member countries and under whose 
auspices the Greater Arab Free Trade Area entered into force in January 2005; 
 
 - the Barcelona (Euromed) Process, inaugurated on 15 November 1995 for the purpose 
of establishing a FTA by 2010 and characterized by progressive integration at the vertical (North-South) and hor izontal (South-South) levels. 
 33. To give concrete expression to this Sout h-South dimension, Tunisia has concluded: 
 - The Arab-Mediterranean Free Trade Agreement, signed on 25 February 2004 and 
providing for the establishment of a free- trade area initially comprising Tunisia, 
Morocco, Egypt and Jordan, while remaining open for accession to all the other Arab Mediterranean countries which have signed  association agreements with the EU; 
  - a free trade agreement with Turkey, signed on 25 November 2004. 
 
34. Tunisia has also concluded bilateral free trade agreements with its Maghreb and Arab 
partners.  A free trade agreement complementi ng the regional agreements already signed was 
concluded with the European Free Trade Asso ciation (EFTA) on 17 December 2004 and ratified in 
2005. 
35. Tunisia’s aims in concluding these agreements, w ithin the context of its open-market policy, 
are, in particular, to strengthen and diversify its  economic and trade coopera tion relations, to benefit 
from technology transfer and to further consolid ate its position in order to attract more FDI. 
(4) P
ROGRESSIVE REDUCTION OF TARIFF PROTECTION  
36. There have been far-reaching changes in tariff protection. In addition to the implementation 
of the WTO Agreement on Customs Valuation in 2 001, preceded in 1998 by the total abolition of 
provisional supplementary duty (DCP), whose rate s for certain sensitive products varied between 
10 and 30 per cent, protection for domestic production has been carefully targeted by adopting an HS nomenclature with 11-digit national subheadings , the maximum protection rate has been set at 
43 per cent for non-agricultural products and at 150  per cent for agricultural products, and the number 
of rates applied has been sharply reduced from 53 in 2003 to 14 in 2005. WT/TPR/G/152 Trade Policy Review 
Page 10 
 
 
 37. Tariff protection has been significantly reduced with a view to relieving the fiscal pressure 
between imports from the EU and imports from othe r countries, beginning in 1998 with the total 
exemption of a list of capital goods.  Subsequently , a 50 per cent tariff reduction was implemented for 
another list of products in tw o phases in 2000 and 2002, the like products having begun to benefit 
from total exemption in 2001.  Further targeted reductions are planned for the period between now 
and 2008 within the context of the approximati on of the MFN tariff and the tariff applied to 
preferential imports.  The impact of tariff protecti on (total customs revenue/total imports cleared for 
home use) is very slight, only 4.4 per cent in 2004. 
(5) A STEADILY IMPROVING TAX SYSTEM  
38. Through a series of reforms of its tax system Tunisia has succeeded in meeting both the need 
for sound and balanced budget financing and the n eed to stimulate economic activity in a rapidly 
changing national and intern ational environment.  These reforms have been aimed at simplifying the 
tax system, reducing rates, expa nding the tax base, reviving economi c activity and modernizing tax 
administration. 
39. In parallel with the successive legislative reform s of the Tunisian tax system, steps have been 
taken to modernize tax administration with a view to making it easier for the taxpayer to discharge his 
obligations.  These measures have made it possi ble to implement a process of comprehensive 
computerization of the tax services and progressive ly install a paperless system for making tax 
returns. 
40. Moreover, with a view to introducing further re forms of the tax system designed to improve 
its cost efficiency and performance, a study of the system that takes the new data and new challenges 
into account has been initiated in order to deal mo re effectively with the changes resulting from the 
accelerated pace at which the economy is being liberalized and opened up. 
(6) A TEXTILES AND CLOTHING INDUSTRY ADAPTED TO THE NEW INTERNATIONAL MARKET 
CONDITIONS  
41. In the course of the last thirty years, Tunisi a has developed an efficient made-up clothing 
industry thanks to a favourable environment, compet itive production costs, proximity to an attractive 
consumer market and the preferential treatment of imports by the EU.  The MFA has contributed indirectly to the expansion of this industry.  In 2001, the sector accounted for more than 40 per cent of 
total merchandise exports, generati ng 4 028 million dinars in income as compared with 2 340 million 
dinars from tourism.  It accounts for more than half of direct employment in the manufacturing 
industry.  Tunisia was the EU’s fifth-ra nking supplier of made-up goods in 2004. 
42. The restructuring plan for the sector is based on improving the industry’s integration and 
competitiveness and adapting it to current interna tional market conditions by making the transition 
from subcontracting to co-contracting and then to fini shed products.  The steps taken to achieve this 
objective mainly involve strengthening the financial capacity of the enterprise, improving the sources 
of supply of raw materials, deve loping fabric finishing activities (an industrial estate is being 
developed precisely for investors in this subsecto r), developing research and innovation by creating a 
special technology centre (being built at Mon astir) and a Fashion Institute, improving training 
facilities and promoting trade in the principal target markets (a three-year pl an has been drawn up and 
began to be implemented at the start of 2005). 
43. Future projections of Tunisian exports are base d on the consolidation of the sector’s share of 
the European market and a more diversified Tunisi an export structure.  In this connection, the Tunisia WT/TPR/G/152 
 Page 11 
 
 
 electrical and electronic industries are performing str ongly and the services sector is destined to play a 
more significant role in development policy.  Th is policy would also make it possible to counteract 
the anticipated erosion of preferences for non-ag ricultural products at the end of the current 
negotiations. 
(7) SERVICES :  ENGINE OF DEVELOPMENT AND SPRINGBOARD FOR THE EMERGENCE OF A 
KNOWLEDGE ECONOMY  
44. Tunisia has already laid down guidelines fo r the development and consolidation of a 
knowledge economy, basing its approach on four complementary and interdependent “pillars”, 
namely: 
 - Education and training; 
  - research and development;   - information and communications technology;  and  
 - systems of innovation and organization. 
 45. Substantial progress has been made in these areas,  particularly in upgrading human resources, 
creating technology centres, intensifying scientific research, diversifying specialization at higher 
education level and, finally, in strengthening the infrastructure, especially in the information and 
telecommunications technology sector. 
(i) Information and communications technology:  a modern, high-quality, high-speed and 
multiservice infrastructure 
46. In recent years, this sector has experienced ra pid growth of about 21 per cent and there has 
been a sustained effort to build on these achievements.  Thus, in the information technology sector a 
series of measures has been adopt ed.  These include the introduction of electronic administration, 
support for private sector investment in IT, promo tion of the national software industry and the mass 
dissemination of a digital culture. 
47. In the communications technology sector, the pr incipal measures have involved modernizing 
and developing the infrastructure, improving telep hone network coverage a nd quality, expanding the 
capacity of the National Internet Network, im proving the networks for the exchange and 
dissemination of information for various purposes (e ducational, commercial) and improving Tunisia’s 
position in the international ICT league. 
48. At the same time, Tunisia has begun opening the sector up to competition, in fulfilment of its 
commitments under the GATS and in preparation for the current round of WTO negotiations.  Several 
important steps have been taken to update the re gulatory framework and adapt it to the reference 
document annexed to Protocol IV on basic tel ecommunications.  These measures have involved:  
(a) the adoption a new communications code, (b) the issuing of regulations concerning implementation, management and interconnection, numbering and the spectrum, (c) the establishment 
of the national telecommunications body as an autonomous regulatory agency responsible for overseeing everything relating to interconnecti on, numbering and other disputes between 
telecommunications operators, (d) the cr eation of a national frequency agency. WT/TPR/G/152 Trade Policy Review 
Page 12 
 
 
 (ii) A financial sector in process of reorganization 
49. Considerable progress has been made with st rengthening the banking sect or and diversifying 
the sources of financing for the benefit of private investment.  The process of privatizing the banking 
sector through strategic partnerships has been speed ed up and the legal and regulatory framework has 
been modernized by introducing the concept of the universal bank and realigning on international 
prudential standards.  The programme of action a dopted stresses the improvement of banking services 
through the consolidation of their financial base a nd the optimization of risk monitoring.  Moreover, 
an intensified effort will be made to modernize the management methods of  the banks and financial 
institutions and thereby improve the standard of service. 
50. Moreover, the financial market has undergone an important legislative and institutional 
transformation with a view to increasing the contribution of direct financing to the economy by stepping up the pace of stock issues and trading vo lume.  In this connection, it is anticipated, in 
particular, that the confidence of savers and fi nancial market investors will be boosted by the 
publication of a new law to improve financial secur ity and that a financial market culture will be 
established, in particular, through improvements in  transparency and the publication of financial 
statements.  Likewise, further action will be ta ken to stimulate the government and corporate bond 
markets and promote the activities of unit trusts. 
51. The insurance sector has also benefited from th e tide of reform which has swept through most 
of the country’s economic and social sectors.  The most important developments  relate mainly to the 
reform of the legal framework a nd to a series of measures designe d to consolidate the financial 
position of the insurance companies and develop cert ain branches of insurance, in particular, motor 
vehicle, life, agricultural, and export insurance. 
(iii) Transport:  a sector open to private investment 
52. This is a sector that has been widely opene d up to private investment.  The reforms have 
involved, in particular, the liberalization of passe nger transport activities, company restructuring and 
improvements to the infrastructure. 
53. The next round of reforms and the sector al development strategy are based on: 
 - The improvement of transport services by encouraging private investment, the 
development of multimodal transport, the promotion of public transport services and 
the coordination of the activities of all those involved in the sector; 
 
 - the upgrading of the infrastructure by incentivizing investors and transport 
professionals to carry out concession-based infrastructure projects, the improvement of road and rail services for seaports and airports, the establishment of logistical platforms outside seaports and the implemen tation of urban rail transport projects; 
 
 - the development of human resources thr ough improved training within the framework 
of vocational programmes adapted to the needs of business; 
  - the sustainable development of the sector  through reconciliation of the requirements 
of development and planning, environmenta l protection, the anti-pollution campaign, 
and energy economy and efficiency; 
 Tunisia WT/TPR/G/152 
 Page 13 
 
 
  - the development and updating of the regulatory framework to adapt it to the 
requirements of sector organization and liberalization; 
  - meeting the challenge of employment by  intensifying efforts to encourage private 
investment. 
 54. For the rail sector , the strategy involves efforts to improve the competitiveness of the 
National Railway Company (SNCFT) to enable it to  face competition.  Emphasis will be placed on 
improving its services, controlling production costs,  developing partnerships for rolling stock 
maintenance, promoting multimodal transport, and connecting up the ports by means of rail links. 
55. Road transport  strategy is based on the following: 
 - Strengthening regional development through the participation of the regional services 
in transport management and the definiti on of local transport operating procedures; 
  - continued opening up of the urban and intercity bus transport sector to private 
initiative by awarding concessions and subcontracts and by authorizing private bus 
station operators; 
  - encouraging people to use public transport instead of private cars in order to reduce 
transport costs, save energy, protect the environment and make traffic flow more 
easily, to be achieved by improving tr ansport services and establishing multimodal 
transshipment terminals and transport hubs, and park and ride facilities; 
  - developing third-party freight transport in order to reduce costs through the 
establishment of freight terminals and th e use of modern communications systems 
and improve the international road transport supply; 
 
 - continuing the restructuring of state- owned enterprises and the modernization of 
public transport network management thr ough the use of operational support systems 
and network integration, both physical and in terms of tariffs; 
 
 - adopting transport plans as an integral part of town and country planning schemes. 
56. Where maritime transport  services are concerned, the policy will be: 
 - To improve the safety and quality of services in conformity with international 
standards by protecting the seaport envir onment, fighting pollution and improving 
port controls and facilities; 
 
 - to strengthen the partnership between Tuni sian and foreign shipowners in order to 
improve operating conditions and performance; 
  - to continue the port upgrading programme by:  
• abolishing the monopoly of the Tunisian Lighterage and Handling Company 
(STAM) in the Tunis Goulette-Radès basin and restructuring the company; 
 
• turning over the operation of the docks  to the private sector on concession; WT/TPR/G/152 Trade Policy Review 
Page 14 
 
 
  
• facilitating procedures in order to reduce the length of time that cargo takes to 
pass through the ports; 
 
• improving the port infrastructure by building a deep-water port; 
 
• connecting up the ports through road and rail links; 
  - to develop multimodal transport and the establishment of logistical platforms for 
cargo consolidation, storage and redistribution; 
  - to implement a programme for upgrading state-owned companies to enable them to 
face competition. 
 57. The air transport  sector is passing through a phase of radical transformation on an 
international scale.  The development strategy for th is sector is based on the progressive liberalization 
of air transport within the framework of re gional and international free trade agreements, 
improvements in safety and security and air transport control systems, the expansion of airport 
capacity and its adaptation to increased traffic, toge ther with improved services for passengers and air 
transport companies, the development of domestic pa ssenger and freight transport and greater private 
investment in the sector. 
(iv) Tunisia, a high-quality tourist destination with a diversified supply 
58. Tourism is one of the pillars of the Tunisian economy.  Today, Tunisia is establishing itself as 
one of the foremost tourist destinations in the S outhern Mediterranean.  The sector contributes 5.7 per 
cent of GDP and accounted for 13.9 per cent of export s of goods and services in 2004.  It is also one 
of the economic sectors most open to foreign inve stment.  Reducing its vulnerability to external 
shocks and improving its competitiveness are at the co re of the development strategy for the tourism 
sector adopted in 2002. 
59. This strategy is based on the implementa tion of institutional reforms and on the 
modernization of the regulatory framework, the fi nancial restructuring and upgrading of tourism 
enterprises (a special programme for upgrading hote l units was set up in 2004), and the development 
and implementation of a new quality, promotion and marketing policy, as well as on improvements in 
the efficiency of the training system a nd the quality of Tunisia’s tourism facilities. 
60. Beach tourism is still the main attraction, but T unisia is the only country to have developed a 
unique form of tourism, namely, Saharan tourism.  It is also one of the first countries to have 
developed thalassotherapy.  In addition to spor ts tourism (golf, regional and international 
competitions), boating holidays and international f estivals, a national cultural tourism programme has 
been adopted.  This will enable Tunisia to make be tter use of its rich cultural heritage and its place in 
the history of civilization.  The diversification and enrichment of the tourism supply will also include 
the consolidation of spa tourism, on the basis of a st udy intended to lead to the development of a spa 
tourism strategy and a ten-year  plan for its implementation. Tunisia WT/TPR/G/152 
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 (v) Professional services and business services: ac tivities with a strong export potential 
61. Since independence, Tunisia has given high priori ty to education and training.  The education 
(including higher education) budget accounts for ar ound 7 per cent of GDP.  The educational system 
is one of the proudest achievements of Tunisia’s social and economic policy. 
62. Thanks to the technical and linguistic skills of  its human resources, Tunisia has developed a 
wide range of efficient and competitive export ser vices consisting mainly of design, consultancy, 
engineering, architectural, accounting and marketing services, legal services, health services, cultural services, construction services and, more particularly, IT services. 
(8) A
N AGRICULTURE LESS DEPENDENT ON THE WEATHER AND AT THE SERVICE OF THE 
RURAL COMMUNITY  
63. Agriculture is playing a leading role in comb ating the exodus from rural areas, raising rural 
incomes and stimulating rural development, while  making a significant contribution to improving 
national food security. 
64. Thanks to its unique climatic and geographical  advantages, Tunisia is one of the largest 
exporters of several speciality foods, in particular, olive oil, dates, citrus fruit, harissa, seafood, and 
various organic fruits and vegetables.  These sectors and others have flourishe d, in particular, as a 
result of a policy aimed at liberalizing local invest ment and welcoming foreign investment.  Tunisian 
agriculture has also benefited from an ambitious programme of development of hydraulic resources 
(dams, hill lakes, deep wells, etc.).  This dyna mic agri-food sector coexists with small family-type 
farms growing self-sufficiency crops with little market integration.  This small-scale agriculture needs 
protection and support in order to guarantee a minimum income for peasant farmers in the rural areas 
and encourage its reorganization and closer inte gration into the domestic and foreign markets. 
65. Tunisia has fully discharged its obligations un der the WTO Agreement on Agriculture and is 
a net importer of food products. 
(9) BETTER PROTECTION FOR INTELLECTUAL PROPERTY RIGHTS  
66. Tunisia is a member of most of the internationa l conventions that provide for the protection of 
intellectual property.  In 2000/2001, it moderni zed its legislation in conformity with the 
WTO Agreement on Trade-Related Aspects of Intell ectual Property Rights.  The strengthening of the 
National Standardization and Intellectual Property Institute (INNORPI) and the establishment of the 
Tunisian Copyright Protection Organization (OTPDA) has made it possible to promote a pro-intellectual property and anti-counterfeiting/anti-pi racy culture.  The measures adopted by the 
legislature to repress such practices, both on the domestic market and at the border, are having a 
deterrent effect. 
(10) W
HAT TUNISIA EXPECTS FROM THE WTO  NEGOTIATIONS  
67. Tunisia’s trade policy lies at the heart of an economic and social policy aimed at stepping up 
the pace of economic growth and improving its job c ontent with a view to raising the standard of 
living and ensuring the well-being of the entire po pulation.  Emphasis is being placed on those high-
value-added activities which are best adapted to th e new job seeker profiles and the establishment of a 
knowledge economy.  Investment policy is aime d at improving the business environment by 
providing a reliable and stable legislative framework. WT/TPR/G/152 Trade Policy Review 
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 68. Tunisia is expecting the negotiations currently  in progress in the WTO to provide effective 
support for the achievement of these objectives.  Its expectations relate to key areas of the 
negotiations and, in particular, to market access for non-agricultural products, trade in services, and 
agriculture. 
(i) Access to markets for non-agricultural products 
69. The choice of a customs tariff reduction formula will be decisive for Tunisia’s future trade 
and economic policy, in particular, as regards the impact on domestic production, almost all of which 
comes from SMEs, and for its export outlets.  The Swiss formula would introduce increased 
competition from similar products benefiting from prefer ential treatment and would lead to structural 
difficulties in implementing mechanisms to protect against unfair trading practices. 
70. Although there is ample scope for bindings c overage, there is little scope for reducing the 
protection of domestic industry, especially as Tunisi a has set itself the goal of creating 70 000 projects 
or enterprises in five years (2005-2009) just when  the textiles and clothing sector, the most important 
manufacturing sector from the standpoint of jobs an d exports, is passing through a phase of extensive 
restructuring following the implementation of the WTO’s Agreement on Textiles and Clothing and 
the end of the MFA. 
71. In this connection, Tunisia would draw partic ular attention to the erosion of the tariff 
advantages that it enjoys in its external market s and its concern regarding the impact of the 
negotiations in this area on its e xports, while reiterating its  request that the sectoral approach proposed 
in the current negotiations should not adversely aff ect its interests in key sectors such as textiles and 
clothing, leather and footwear. 
(ii) Trade in services 
72. Tunisia is actively participating in the current  negotiations on services. It submitted its initial 
offer within the time-limits set by the decision of  the General Council of 31 July 2004.  Tunisia 
supports the principle of a services sector liberalization that favours improved economic 
competitiveness and increased value added, technology transfer and job creation.  The promotion of 
private investment and the attraction of foreig n direct investment (FDI) are essential means of 
attaining these objectives.  At the same time, Tuni sia expects to obtain easier access to the services 
markets in which it enjoys major export advant ages, mainly professional services and business 
services.  This will require more flexible travel and residence procedures and conditions for Tunisian 
service providers and, in particular, more transparent immigration policies and rules that facilitate the 
conclusion of agreements on the rec ognition of diplomas and qualifications. 
(iii) Agriculture 
73. The current negotiations and the commitments to  which they will lead should make it possible 
to adjust the liberalization of trade to suit specifi c national circumstances, particularly those of the 
developing countries.  Tunisia hopes to take advant age of these negotiations to develop and diversify 
its agricultural exports.  The negotiations should also minimize the adverse effect s of liberalization, at 
least in the short term, and thus enable the adjust ments made to produce their beneficial effect of 
improved competitiveness.  A gradual approach to th e reduction of customs duties, for ordinary and 
non-sensitive products, would be better suited to the ch aracteristics of Tunisian agriculture.  While 
improving market access, it would make possible the ma intenance of a tariff structure consistent with 
agricultural development objectives.  A similar a pproach should be adopted in relation to domestic 
support.  Special and differential treatment should enable countries w ith a food gap to pursue policies Tunisia WT/TPR/G/152 
 Page 17 
 
 
 designed to encourage the production of basic products  with real potential by excluding support for 
the market prices of these products from the Aggregate Measurement of Support (AMS). 
III. TUNISIA’S FUTURE STRATEGIC CHOICES 
(1) A PROACTIVE FULL EMPLOYMENT POLICY  
74. To meet the challenge of employment, there w ill be sustained emphasis, on the one hand, on 
promoting private investment and creating small a nd medium-sized enterprises and, on the other, on 
actively increasing the effectiveness of employment policy by mobilizing the potential and improving the tools so as to create the maximum possible numbe r of quality jobs and relieve the pressure of 
unemployment, while balancing supply and demand on the labour market, preserving existing jobs 
and facilitating the reintegration into economic life of those who have been made redundant.  This 
proactive employment policy will lay special emphasis on: 
 - Strengthening the programmes designed to promote the employment of young people 
and encourage SMEs to recruit graduates to enable them to face competition and 
improve their profitability; 
 
 - improving the employability of job seekers and particularly graduates; 
  - opening up broader horizons for gr aduates by introducing the culture of 
entrepreneurship into the various training courses; 
 
 - the further restructuring of the vocational training system, the expansion of its 
capacity and the diversification of its programmes; 
  - encouraging self-employment and improvi ng the existing support institutions and 
programmes such as the Banque Tunisienne de Solidarité  (Tunisian Solidarity Bank), 
the micro-loan system, the Fonds Spécial de Développement Agricole et de la Pêche  
(Special Agricultural Development and Fisheries Fund), and the credit resources of 
the Fonds de Roulement  (Working Capital Fund); 
  - making the procedures for implementing the labour legislation more flexible to 
facilitate the movement of labour from less profitable to more profitable sectors. 
 
75. In parallel with the attention gi ven to new job seekers, efforts will be made to assist workers 
who have lost their jobs through improved social s ecurity coverage and re-e mployment programmes.  
A new system will be introduced to enable those who have been made redundant to find new jobs. 
(2) P
RIVATE INVESTMENT IN INNOVATIVE ACTIVITIES  
76. The aim of investment policy is to step up the pace of growth and improve its job content by 
encouraging high-value-added activitie s, which are better suited to the new job seeker structure, and 
the creation of a knowledge economy.  Thus, the in vestment ratio should rise to 27 per cent of GDP, 
while private investment should account for at least 60 per cent of total investment.  As for services 
and the new sectors, their contribution to GDP shoul d reach 18 per cent by 2009.  The components of 
the new investment policy are as follows: WT/TPR/G/152 Trade Policy Review 
Page 18 
 
 
  - Improvements in the investment climate and the business environment through the 
continuation of the programme to reduce the number of administrative permits, reduction of the minimum capital requirement  for companies, reduction of the tax 
burden on businesses, reduction of tariff prot ection and facilitati on of trade, the 
gradual approximation of the various inv estment regimes, a stable legislative 
framework for business activities, the ma intenance of a sound and responsive 
macroeconomic framework and the strengt hening of competition policy and its 
institutional infrastructure; 
 
 - creation of a new generation of innovative companies in buoyant sectors, a greater 
private-sector contribution to investment in infrastructure through the concession and BOT regimes, implementation of the tec hnology centre programme with foreign 
partners in order to take advantage of technology transfer and foreign expertise, 
generalization of business incubators by est ablishing one in every region within the 
institutes of technology and the creation of a new generation of industrial estates and 
areas to meet the needs of investors and the demand, scientific research, and 
development of the partnership between th e universities and resear ch institutions, on 
the one hand, and industry, on the other. 
 77. The most promising sectors include transpor t, the new information and communications 
technologies, education, training, and environmental and health services. 
(3) T
OWARDS COMPLETE CONVERTIBILITY OF THE TUNISIAN DINAR  
(i) Continuing reform of the tax system 
78. Further reform of the tax system should make it possible to improve its efficiency and yield, 
in particular through better coordination of the va rious tax regimes and con tinued rate adjustments, 
with account for economic and social trends and th e goals and objectives of Tunisia’s development 
scheme.  In this connection, a study of the ta x system will be undertaken with a view to the 
preparation of a plan for implementing these reforms. 
(ii) Pursuit of a prudent monetary policy 
79. The aim is to establish greater control over infl ation while raising larg er amounts of suitable 
financing for economic activity thro ugh greater recourse to indirect monetary instruments in order to 
regulate the level of liquidity in the econom y and make interest rates more flexible. 
(iii) Reform of the financial sector 
80. These reforms are intended to improve the perfo rmance of the banking sector and modernize 
its structures.  The emphasis is on strengthening the banks’ financial base, in particular as regards the 
formation of the necessary reserves and provision fo r bad and doubtful debts, thereby enabling them 
to meet the standards of prudent management.  Special  attention will also be paid to the quality of the 
services offered and the improvement of electronic banking services, as well as to the adoption of modern management methods.  Moreover, the fina ncial market will be developed in order to 
consolidate the direct financing of the economy thro ugh the attraction of savings and their investment 
and the encouragement of businesses to open up their capital and obtain a listing on the stock exchange. Tunisia WT/TPR/G/152 
 Page 19 
 
 
 81. The insurance sector will be taking a further step along the path of reform by improving its 
services and strengthening its global balances.  The sect or is also expected to improve its position as a 
result of the upgrading of the insu rance companies, the consolidation of their financial base, the 
modernization of their management methods, the adoption of quality assurance systems, the 
improvement and simplification of insura nce policies and intensified training. 
(iv) Advancement of the gradual process of achi eving complete convertibility of the dinar 
and external financial liberalization 
82. The process includes the introduction of greater flexibility into certain current operations and 
consolidation of the liberalization of capital transa ctions in order to adapt to the opening up of 
business to the international environment.  The pr oposed measures will involve an increase in the 
authorized external borrowing and foreign investment  thresholds, as well as the continuation of efforts 
to develop the current system for covering the exchange rate risk and to encourage economic 
operators to exert closer control over their fore ign transactions and make better use of the tools 
available for that purpose. 
(4) LAYING THE FOUNDATIONS FOR A KNOWLEDGE ECONOMY  
83. During the period 2005-2009, further efforts w ill be made to establish a robust and modern 
communications infrastructure adapte d to international standards.  This should make it possible to 
achieve 80 per cent telephone covera ge by 2009, as well as providing universal digital opportunities 
through realization of the goal of installing a milli on computers and allocating every citizen an e-mail 
address by the end of 2009.  The regions will al so benefit from this programme through the 
establishment of a public Internet centre in every villa ge.  With regard to the development of scientific 
research and technology and their role in laying the foundations of a knowledge economy, steps will 
be taken to achieve the objective of increasing expend iture on scientific research to 1.25 per cent of 
GDP by 2009 as compared with 1 per cent in 2004.  This ratio is expected to reach 1.05 per cent of 
GDP in the course of 2005. 
IV. CONCLUSION 
84. Tunisia is currently regarded as an emerging country with a competitive economy.  In its 
annual report on global competitiveness for 2004-20 05, the Word Economic Forum ranked Tunisia 
30th in the global competitive index and 32nd in th e microeconomic competitiveness index.  It has 
one of the highest openness ratios in the world. 
85. Its constant endeavours and achievements do not b lind Tunisia to the fact that the process of 
integrating its economy more closely into the world economy in order to take greater advantage of the 
Multilateral Trading System is a vital concern that ca lls for even greater efforts at every level.  The 
action programme for 2004-2009 will make it possible to launch a new round of reforms to speed up 
growth, establish tighter control over the manageme nt of macroeconomic balances, create more 
private-sector enterprises, increase exports, liberali ze the movement of capital, develop high-value-
added services, promote research, and build a knowledge economy. 
86. As host for the second phase of the World Summit on the Information Society, to be held 
from 16 to 18 November 2005, Tunisia is working un tiringly to integrate the new information and 
communications technologies efficiently into its trade strategy with a view to stepping up and 
facilitating trade in goods and services, encouragin g innovation and improving market access.  It 
regards this Summit as an unique opportunity to de velop an effective and mutually supportive digital WT/TPR/G/152 Trade Policy Review 
Page 20 
 
 
 partnership in the field of e-commerce and thus cont ribute to greater growth for the benefit of all the 
stakeholders in the new knowledge economy. 
87. The country is eager to bring the five-year programme for the period 2004-2009 to a 
successful conclusion in order to consolidate the ga ins that have been made and create the conditions 
for a more competitive economy and a more prosperous society. 
__________