Tunisia WT/TPR/S/152 
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I. ECONOMIC ENVIRONMENT 
(1) MAIN FEATURES OF THE ECONOMY  
1. Tunisia is situated on the north coast of Africa,  sharing borders with Algeria in the west and 
Libya in the east.  It currently has a population of 10 million.  Thanks to its climate, its proximity to 
Europe, its socio-political stability and a comparativ ely well-qualified labour force, Tunisia enjoys 
significant economic advantages, despite its modest reserves of natural resources (oil and phosphate).  
These advantages, together with a stable macroeconom ic environment, have enabled Tunisia steadily 
to increase its real per capita income (Chart I.1), pa rticularly since its last Trade Policy Review (TPR) 
in September 1994. 
 
0 500 1000 1500 2000 2500 3000 
1995 1996 1997 1998 1999 2000 2001 2002 2003 20040369Chart I.1  
Rate of growth of GDP an d per capita GDP, 1995-2004
Per capita GDP  
Rate of growth of  GDP (right-hand scale)Euros a Per cent
a 
Source:  Ecus up to 1998 and euros as from 1999.  
National Institute of Statistics, on-line information.  Available at:  http://www.ins.nat.tn/.
 
2. Contrary to what happened in many other developing countries, in Tunisia the 
macroeconomic adjustment which began in 1986 w as accompanied by a strengthening of anti-poverty 
measures, with an increase in per capita social e xpenditure.  Since the 80s, rural development policy 
has focused on and protected small farms, which has made it possible to increase rural incomes and 
sharply reduce the incidence of poverty.  The proportion of the population living below the poverty 
line has declined steeply since 1975, reaching a leve l of about 4 per cent in 2004 (Table I.1);  the 
literacy level has also risen.  Social policy incl udes rural and urban public works programmes (65 per 
cent of the population lives in urban areas), numerous social benefits, including in the areas of health 
care, schooling, housing, employment for young pe ople and the destitute, and consumer subsidies for 
food and other staples (Chapters III(4)(ii) and IV(2)(ii)).   The latter have prov ed to be an expensive WT/TPR/S/152 Trade Policy Review 
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(0.5–1 per cent of GDP) means of reducing poverty,  inasmuch as they are available to the entire 
population.1  
Table I.1 
Main socio-economic data, 1994 and 2004 
 1994 2004 
Resident population (millions) 8.8 9.9 
Demographic growth rate (per cent) 1.7 1.0 
Proportion of the population living below the poverty line 6.2 4.2a 
Literacy 31.7 22.9 
GDP, total (millions of dinars at current prices)  15,814 34,960 
GDP, total (millions of eurosb at current prices) 13,157 22,654 
GDP, total (millions of US dollars at current prices) 15,657 27,968 
GDP,  per capita (US dollars) 1,779 2,825 
GDP, per capita (euros) 1,493 2,278 
Share of real GDP at market prices (per cent)   
   Agriculture (inc. fishing and livestock) 13.7 13.0 
   Mining and energy sector 7.0 5.4 
      Oil refineries and gas 4.8 3.5 
   Manufacturing sector 18.0 17.5 
      Agri-food industries 4.0 3.3 
      Textiles, clothing and leather industries 5.9 5.3 
      Mechanical and electrical engineering industries 2.5 2.9 
   Services  61.3 64.1 
      Building and civil engineering 5.7 4.7 
      Transport and communications 8.7 11.1 
      Finance 4.2 5.3 
      Restaurants and hotels 5.2 4.7 
      Commercial   9.0 9.1 
      Other services (non-market and other) 22.7 20.3 
Share of total employment (per cent)   
   Agriculture (inc. fishing and livestock) 21.9 16.3 
   Industry, mining, energy, building and public works  35.0 34.3 
   Services 43.1 49.4 
a Level in 2000. 
b In ECUs for 1994. 
Source : National Institute of Statistics , on-line information.  Availa ble at:  http://www.ins.nat.tn.  
3. The manufacturing sector, particularly the clot hing industry, has been the spearhead of 
Tunisian economic development; it has been stimulated by a policy of encouraging foreign direct investment and exports.  It contributes about 17 per cent of GDP.  Between 1992 and 2002, the annual 
average increase in manufacturing e xports was considerable (12 per cent).  The sector consists of 
more than 10 000 enterprises, almost one quarter of which are wholly export-oriented, while nearly 
one fifth are, in varying degrees, foreign-owned.  The textiles and clothing industry is currently in the 
throes of restructuring following the abolition of quo tas within the framework of the WTO.  On the 
other hand, the motor vehicle component industry has progressed by leaps and bounds during the last 
ten years, aided by special trade measures introdu ced at the time when local vehicle assembly ceased. 
Agri-food is another important manufacturing indu stry.  Altogether, about 42 per cent of total 
manufacturing output is exported. 
                                                     
 
1 Ghali, S. (2004). Tunisia WT/TPR/S/152 
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4. The mining and energy sector currently accounts for about 5 per cent of GDP.  The stagnation 
of domestic production of petroleu m products and a rapid increase in demand have turned Tunisia 
from a net exporter, until 1992, into the net importer it is today.  The agricultural sector, dominated by arboriculture (mainly, olives, the chief export crop)  and livestock breeding, is heavily protected and 
supported for various purposes.  Despite these measur es, the sector contributes only 13 per cent to 
GDP while employing about 16 per cent of the working population, and Tunisia remains a net importer of food products  (Chapter IV(2)). 
5. Thus, Tunisia's strategy has been to promot e exports, especially of  manufactured products, 
while heavily protecting enterprises producing for the domestic market.  This strategy has created a 
dualism within the economy which has hampered the integration of domestic market and export-
oriented activities.  It has increased the depe ndence of exporters on im ported inputs and made it 
necessary to subsidize enterprises th at process locally produced goods for export.  Admittedly, there 
have been attempts at liberalization within the c ontext of trade agreements, but at present they are 
significant only in relation to trade in non-agricultural products, in particular with the European Union (EU), Tunisia's main trading partner.  However, value added accounts for only 18.5 per cent of 
the value of the output of Tunisia's manufacturing sector.   
6. Because of heavy state involvement, many services activities have missed out on the flow of 
foreign direct investment and the associated gains in productivity.  In fact, the services which grew 
the most during the decade from 1995 to 2004 were tho se open to private initiative, namely, transport, 
health and wellbeing, computer services, call centr es, construction and engineering (Table I.1).  
Certain services, in particular, banking and insuran ce, ran into financial difficulties during the 80s and 
underwent several restructurings designed to ensu re tighter supervision and prudential controls.
2  The 
ongoing reforms are evidence of Tunisia's awareness of  the need to develop new centres of growth 
capable of creating jobs (and, in particular, of absorbing the job losses in the textiles and clothing 
industry) and strengthening the role of trade in services in Tunisia's economic growth. 
7. Tunisia's currency is the Tunisian dinar.  Tuni sia has a "crawling peg" exchange rate system.  
It formally accepted the obligations laid down in paragraphs 2, 3, and 4 of Article VIII of the 
IMF Statutes in January 1993.  Steps are being taken to liberalize the movement of capital (Section (2) below).  It is estimated that Tunisia' s total public debt will be about US$16.3 billion in 
2005 (57.6 per cent of GDP), and its extern al debt US$16.2 billion (57.4 per cent). 
(2) R
ECENT ECONOMIC DEVELOPMENTS  
8. Intended to correct major macroeconomic imba lances, the reforms undertaken by Tunisia 
within the context of its Seventh Five-Year Plan  (1987-1991) stressed economic growth based on the 
promotion of exports through, inter alia , a system of incentives, includi ng incentives for foreign direct 
investment.  The next three five-year plans stuc k to this approach, even though their declared 
objective was to increase competition within the Tuni sian economy, which in general had remained 
heavily regulated.  All the same, to some extent  the 1995 Association Agreement with the European 
Union, including its tariff reduction programme for i ndustrial products, liberalized bilateral trade and 
contributed to Tunisia's economic growth.  In fact, the reforms helped to bring about an increase in 
real GDP at annual rates approaching or exceedi ng 5 per cent throughout the decade from 1996 to 
2005, except in 2002 when the economy was hit by a serious drought whose effects were compounded 
by the world economic slowdown, the fall in the numbe r of tourists following the events of September 
2001, and the consequent decline in foreign exchan ge earnings.  Per capita GDP also grew steadily 
                                                      
2 World Bank (2004d). WT/TPR/S/152 Trade Policy Review 
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during the decade from 1995 to 2004 (Chart I.1).  The unemployment rate fell from 16 per cent in 
1994 and 15 per cent in 2002 to 14 per cent in 2004. 
9. With respect to bilateral liberalization, in 199 6 a micro-structural adjustment or "upgrading" 
programme was introduced to improve the competitiveness of the manufacturing sector and related 
service enterprises (Chapter IV(3)).  In 1997, the Conseil supérieur de l'investissement et de 
l'exportation  (CSIE – Investment and Export Council) w as established to define export strategy and 
design the mechanisms needed to implement it.3  In 1999, the Government, with the support of the 
World Bank, also launched an export developm ent programme designed to improve the export 
capacity of Tunisian enterprises;  the project for a si ngle form for imports and exports is part of this 
programme.  As early as 1989, the Government also set up a legislative framework for privatizations.  
In general, however, the approach to privatizati on has been rather timid and in 2003 the contribution 
of state-owned enterprises to GDP was around 13 per cent.  Moreover, gross fixed capital formation 
stands at around 25 per cent of GDP, with a declining trend since the year 2000, due partly to the fall in private investment (Table I.2).  
Table I.2 
Economic indicators, 2000-05  
  2000 2001 2002 2003 2004 2005a 
National accounts (annual change, in per cent) 
Real GDP 4.7 4.9 1.7 5.6 6.0 5.0 
   Agriculture and fishing -1.0 -2.0 -11.0 21.5 10.0 -4.0 
   Manufacturing industries 6.6 6.9 1.8 0.9 5.1 3.1 
   Non-manufacturing industries 3.5 2.1 4.9 1.5 3.5 3.6 
   Tradable services activ ities 6.7 6.9 3. 9 4.3 7.7 9.2 
Imports of goods and non-factor services 8.9 13.6 -3.8 0.7 3.7 4.9 
Final consumption  5.5 5.4 3.9 5.0 4.8 4.4 
   Private consumption  5.5 5.7 3.8 5.1 4.9 4.4 
   Public consumption 5.5 4.4 4.3 4.5 4.6 4.6 
Gross fixed capital formation 4.3 8.3 -1.7 -3.2 2.4 5.5 
Exports of goods and non-factor services 5.3 11.5 -3.7 0.3 5.2 3.9 
  (in millions of dinars at current prices) 
GDP at market prices  26,651 28,757 29,933 32,212 35,104 37,758 
Imports of goods and non-factor services 12,842 15,029 14,823 15,341 16,812 18,100 
Gross fixed capital formation 6,923 7,542 7,607 7,531 8,023 8,705 
Exports of goods and non-factor services 11,872 13,711 13,542 14,094 15,659 16,654 
  (as a percentage of GDP) 
Gross national savings  24.6 23.5 21.9 21.8 22.4 22.4 
   State 4.9 5.3 4.8 3.9 4.4 .. 
   Rest of the economy 19.8 18.1 17.1 17.8 18.0 .. 
Gross investment (as a percentage  of GDP) 27.7 26.2 25.4 23.4 22.9 23.1 
   State 4.4 4.4 7.6 6.7 6.3 .. 
   Rest of the economy 23.3 21.8 17.8 16.6 16.5 .. 
  (percentage change) 
Consumer prices  3.0 1.9 2,8 2.8 3.6 3.0  
Unemployment rate 15.6 15.0 14,9 14.3 13.9 .. 
External sector        
Trade balance (percentage of GDP) -14.0 -14.4 -12.6 -11.5 -11.0 11.9 
Balance on current account (percentage of GDP) -4.2 -4.3 -3.6 -3.0 -2.1 -2.7 
Table I.2 (cont'd)  
                                                      
3 Decree No. 97-612 of 7 April 1997. Tunisia WT/TPR/S/152 
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  2000 2001 2002 2003 2004 2005a 
Total reserves, excluding gold (billion s of US dollars at end of period) 11..88  22..00  22..33  33..00  33..22  33..00  
   In months of imports of goods and non-factor services 2.4 2.3 2.7 3.1 3.0 .. 
Nominal exchange rate (dinar/euro, end of period) 1.26 1.29 1.l34 1.45 1.54 .. 
Real effective exchange rate (percentage change)b -1.7 -2.4 -0.9 -3.6 .. .. 
Public finances (in millions of dinars, at current prices, end of period)  
Total expenditure 10,604 10,703 11,422 11,070 12,833 12,990 
Balance -653 -995 -579 -1,036 -899 -855 
Balance (as a percentage of GDP)  -2.4 -3.5 -1.9 -3.2 -2.6 -2.3 
External debt 13,691 15,010 15,550 16,610 17,522 18,073 
External debt (as a percentage of GDP) 51.7 52.2 51.9 51.6 49.9 47.9 
Debt service (as a percentage of GDP) 8.8 7.3 7.6 6.6 7.5 7.1 
Debt service/Exports of goods and services 21.4 15.4 16.9 15.2 15.3 15.5 
Financial indicators (end of period)        
Money (M1) (percentage change) 10.3 10.1 -1.8 5.5 9.0 5.5 
Broad money supply (M3) (percentage change) 13.2 11.3 5.2 6.3 8.7 7.6 
Money market rate (end of period) 5.88 5.94 5.91 5.00 5.0 5.0 
.. Not available. 
a Forecast. 
b A minus sign indicates depreciation. 
Source : Ministry of Development and Intern ational Cooperation, Economic  Budget 2005;  National In stitute of Statistics, 
on-line information, availa ble at: http://www.ins.nat.tn/pag e02.asp;  Central Bank of Tu nisia, on-line information;  
International Monetary Fund, on-line information; a nd information supplied by the Tunisian authorities.  
10. A process of tax reform, beginning in 1988 with, in particular, the introduction of VAT and a 
single tax on personal and corporate income, has gradually progressed towards greater harmonization 
of the various direct and indirect taxes (Chapter III(2 )(iv)).  However, the indirect taxation system is 
still complicated, with numerous special regimes a nd exemptions.  Indirect taxes seem to weigh 
heavily on household consumption and on imports.  There is a complicated system of export 
exemptions, most exporters having free-point status  whatever their location.  In 2004, however, 
revenue increased faster than expenditure which made it possible to reduce the budget deficit below 
3 per cent of GDP (Table I.2).  This helped to  lower the ratio of total public debt to GDP. 
11. There have been several reforms of the  financ ial system aimed, firstly, at strengthening the 
financial position of the banks and insurance compani es and, secondly, at diversifying the range of 
financial products available to economic operators.  Despite these reforms, the financial sector, 
particularly the banks, continues to be highly risk-a verse, which is restricting its capacity to provide 
the productive sectors of the economy with credit a nd thus sustain economic growth.  Thanks to the 
prudent monetary policy of the Central Bank of T unisia (BCT), the inflation rate has fallen from 
5.5 and 4.5 per cent in 1995 and 1996, respectively, to about 3 per cent today.  The BCT's broad 
objective is to hold inflation at a level similar to that which exists in Tunisia's partner and rival 
countries.  Its underlying operational objective is th e level of the monetary base, with the M3 money 
supply as an intermediate objective.  Its main means of intervention are the money market rate, which 
it fixes, and, to a lesser extent, the minimum reser ve ratio it imposes on the banks.  The repo market is 
still underdeveloped, although a law to prom ote its development was passed in 2003.4 
12. Since 2002, the Central Bank has been pursuing a policy of steady depreciation of the real 
effective exchange rate of the Tunisian dinar, mainly through intervention aimed at influencing the 
nominal exchange rate.  The foreign exchange market , and hence the dinar exchange rate, continues to 
                                                      
4 Law No. 2003-49 of 25 June 2003. WT/TPR/S/152 Trade Policy Review 
Page 6 
 
 
be regulated, although a certain amou nt of liberalization is going on.5  All operations must be 
"domiciled" and linked to authorized internationa l transactions.  "Approved intermediaries" and the 
BCT may buy and sell foreign currency on the spot or forward markets at freely negotiated rates. 
However, every day the BCT posts an intervention rate  of exchange (buy/sell) with the currencies of 
the principal partner countries.  At the end of the day, the intermediaries, including the banks, must 
transfer their foreign currency to the BCT ("settling up "). Capital movements continue to be restricted.  
The stated intention of the authorities is progressively  to liberalize them and eventually to make the 
dinar fully convertible.6   
13. Recent foreign exchange liberalization measur es have chiefly concerned "partially exporting 
resident" enterprises (Chapters II(6) and III(3)).  In  particular, although these enterprises are always 
under an obligation to repatriate all their export ear nings and domicile them in Tunisian banks, they 
can hold up to 100 per cent (70 per cent prior to Jan uary 2005) of these earnings in foreign currency 
accounts.  Moreover, the annual allowance for e xport-related business trips has been raised from 
15 per cent to 25 per cent of earnings from expor ts of goods and services for the current year, 
provided that those earnings are derived from the ac tivity for which the allowa nce has been requested, 
and a request is made to the BCT on "form F2".  At the same time, the amounts of foreign currency 
that resident enterprises are authorized to borro w freely from non-residents have been increased, from 
10 million dinars to an unlimited amount for financia l institutions and from 3 to 10 million dinars for 
other enterprises.  It is also possible for "non -residents" to hold "convertible dinar" accounts 
(Chapter II(6)).7 
(3) TRADE PERFORMANCE AND INVESTMENT  
14. The average ratio of trade in goods and ser vices to GDP, about 92 per cent for the period 
1994-2004, reveals the importance of trade for the T unisian economy.  The traditional trade deficit of 
about 3 billion dinars (Table I.3) reflects a defic it of about 5 billion dinars on "resident" transactions 
which the 2 billion dinar "non-resident" surplus can only partially absorb.8  The resident regime 
accounts for about two thirds of imports and one third of exports, mainly agri-food products and 
energy and mining products.  The non-resident regi me chiefly covers trade in the products of the 
textiles and clothing, leather, and footwear industries.  
15. The trade deficit is partially offset by surp luses on services (more than 2 billion dinars in 
2004), factor income and transfers (Table I.3).  A general trend towards improved balances for these 
components of the current account made possible a reduction in the deficit to 2 per cent of GDP in 
2004 (Table I.2).  This trend, together with a general improvement in the surplus on capital 
transactions, has strengthened the balance of payments  and allowed net foreign exchange assets to rise 
to 4.7 billion dinars at end 2004, i.e. the equi valent of more than three months' imports. 
                                                      
5 International Monetary Fund (2004).  
6 "Le Gouverneur de la Banque centrale de Tunisi e: Favoriser l'in ternationalisation des enterprises 
tunisiennes et leur implantation en de hors du pays", 20 October 2004.  Available at:  http://www.amb-tunisie.fr/ 
info/article.php3?id_article=389. 
7 Circular for approved intermediaries, No. 2001-09, 2 March 2001.  Available at:  
http://www.bct.gov.tn/francais/download /circulaires/cir2001-09.pdf;  and Ci rcular for approved intermediaries, 
No. 2003-05, 27 March 2003.  Available at:  http://www. bct.gov.tn/francais/download/circulaires/cir2003-05.pdf. 
8 Central Bank of Tunisia (2004). Tunisia WT/TPR/S/152 
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Table I.3 
Balance of payments, 1998-04 
(Millions of dinars)  
 1998 1999 2000 2001 2002 2003 2004 
A - Current account -769 -534 -1,126 -1,242 -1,060 -941 -691 
Merchandise -2,449 -2,550 -3,088 -3,440 -3,019 -2,924 -3,032 
   Merchandise exports (f.o.b) 6,518 6,967 8,005 9,504 9,749 10,343 12,055 
   Merchandise imports (f.o.b) 8,968 9,517 11,092 12,944 12,768 13,267 15,087 
Services 1,709 2,001 2,122 2,138 1,750 1,707 2,048 
   Credit  3,139 3,464 3,792 4,189 3,813 3,784 4,521 
      of which: tourism 1,713 1,954 2,095 2,341 2,021 1,903 2,290 
      of which: transport .. 710 815 918 870 937 1,140 
   Debit 1,430 1,463 1,670 2,051 2,063 2 077 2 473 
      of which: transport .. 683 750 941 929 988 1 233 
Factor income -89 -52 -228 -49 105 182 151 
   Credit 1,005 1,125 1,220 1,471 1,624 1 715 1 925 
      of which: labour income 902 1,020 1,091 1,334 1,522 1 611 1 783 
   Debit 1,094 1,177 1,448 1,520 1,519 1 533 1 774 
      of which: interest on debt   557 578 652 652 702 713 771 
Current transfers 60 66 68 110 104 95 143 
   Credit 68 71 80 129 121 119 165 
   Debit 8 5 12 19 17 24 22 
B - Capital account 559 1,347 835 1,650 1,307 1,477 1,952 
   Capital transactions 69 70 4,2 76 108 76 134 
      Credit 94 86 12,1 80 118 85 141 
      Debit 25 16 7,9 4 11 9 7 
   Foreign investment 779 424 1,001,3 637 1,139 713 767 
      Credit 852 512 1,137,9 718 1,194 794 862 
      Debit 74 88 136,6 82 55 81 94,6 
   Loans and borrowings -289 853 -170,9 938 60 689 1,051 
      Credit 1,474 2,360 2,567,8 2,916 2,895 2,617 3,229 
      Debit 1,762 1,507 2,738,7 1,978 2,835 1,928 2,178 
C - Adjustment (net flows) -2 5 -41,7 -35 -48 -43 0 
Balance of payments -213 818 -333 374 199 496 1,213 
.. Not available. 
Source:  "Évolution des principaux flux et soldes des paiements ex térieurs".  Available at:  http://www.bct.gov.tn/francais/ 
indicateurs/paiements.html;  and National Institute of Statistics (2002), Annuaire statistique de la Tunisie , No. 45.  
(i) Trade in goods and services 
16. The principal exports are clothing, textiles, l eather, and footwear and parts thereof (almost 
half the total), electrical equipment for the automotive industry, chemical products (chiefly phosphate fertilizer), and fuel (chiefly fuel oil) (Chart I.2 and Table AI.1).  The value of merchandise exports 
rose rapidly in 2003 and 2004, reflecting the growth in world demand, higher prices for the main industrial raw materials, and a pickup in ag ricultural exports after four years of drought. 
 WT/TPR/S/152 Trade Policy Review 
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0%10%20%30%40%50%60%70%80%90%100%
1995 2000 2001 2002 2003 2004
0%10%20%30%40%50%60%70%80%90%100%
1995 2000 2001 2002 2003 2004Chart I.2
Structure of merchandise trade, 1995-2004
(a) Exports (fob)
(b) Imports (cif)
Source: WTO Secretariat calculations, based on data extracted  from Comtrade, UNSD (SITC Rev. 3).
Agriculture
 Other semi-finished
 Transport
Machinery, non-electrical
 Mining and quarrying
 Textiles
Machinery, electrical
 Fuels
Machinery, non-electrical
 Food products
 Clothing
Transport
 Chemical products
Other consumer
goods
Office machines etc.
 Iron and steel
 Clothing
Other electrical machinery
§Chemical products
 Other
Textiles
 Other semi-finished
 Other
 Tunisia WT/TPR/S/152 
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17. Imports are more diversified and include textiles (generally for use in making clothing), 
agricultural products (especially cereals and other fo od products), and industrial goods (Table AI.2).  
The share of food product imports has declined since 1995 as has that of fuel, despite the depletion of 
domestic oil fields.  The high content of foreign input s in domestically produced goods is reflected in 
the fact that raw materials and semi-finished pr oducts account for nearly 30 per cent of imports. 
18. Most of Tunisia's trade, especially its export tr ade, is with the EU (Chart I.3 and Tables AI.3 
and AI.4).  France alone supplies over 27 per cent (26 per cent in 1995) of total imports and accounts 
for one third of the export market;  Italy, and to a lesser extent Germany, are the other main trading 
partners. 
19. In the last ten years, Tunisia has diversifie d the markets for its exports to include, in 
particular, Belgium, the United Kingdom, Switzerla nd, and Turkey (to which it mainly exports 
phosphate products).  The trade data do not reveal any particular intensification of the flow of imports 
from the European Union following the conclusion of the free trade agreement.  On the other hand, 
Tunisian exports to the EU have increased substantially. 
20. There continues to be little trade with the c ountries of the northern subregion of Africa.  
Various external factors, including the interna tional embargo on Libya up to 1999 and the domestic 
crisis in Algeria, as well as de lays in trade liberalization under ag reements such as the Maghreb Arab 
Union, have not been conducive to the growth of re gional trade.  In particular, trade with Algeria 
collapsed between 1995 and 2000;  in 2003, Algeri a accounted for only 1.4 per cent of Tunisian 
exports and 0.6 per cent of imports.  Exports to Li bya developed in the course of the decade to reach 
nearly 5 per cent of total Tunisian exports in  2000, before falling back sharply between 2002 and 
2003. 
21. In general, trade with the American continen t has contracted, in both value and percentage 
terms.  The exception is Argentina, whose exports of cereals and soya cake to the Tunisian market 
grew significantly between 1995 and 2003.  Exports of  phosphate products to Brazil have also been 
expanding.  Trade with Asia presents  a contrasting picture.  Tunisia' s exports to Asia, especially to 
Iraq and India, have fallen sharply.  On the ot her hand, imports from Asia, especially from China, 
have increased as a proportion of total imports.  Imports of sulphur, mainly from the countries of the Persian Gulf, have also progressed. 
22. Traditionally, Tunisia is a net exporter of ser vices.  Exports of services (including factor 
services) amount to 51.2 per cent of the foreign exchange earnings from goods (Table I.3).  Tourism 
accounts for more than half of foreign exchange  earnings from non-factor services, or 2.3 billion 
dinars in 2004.  Remittances from Tunisian worker s living abroad have steadily increased and in 
value now rank just behind earnings from tourism (1,783  million dinars).  In general, exports of other 
services, especially consultancy services, have grown strongly.  Apart from interest payments on its 
debt, which remain reasonable since external debt  is relatively low, Tunisia is also spending on 
services related to merchandise trade (especially imports). WT/TPR/S/152 Trade Policy Review 
Page 10 
 
 
Chart I.3
Destination and origin of m erchandise trade, 1995 and 2004
1995 2004
(a) Exports (fob)
Total: 5,474.6 million US dollars Total: 9,622.9 million US dollars
(b) Imports (cif)
Total:  7,903.1 million US dollars Total:  12,727.1 million US dollarsPercentage
Source :  WTO Secretariat caclculations, based on daa extracted from Comtrade, UNSD (SITC, Rev.3)Europe
78,1USA
5.1
France
25.6
Italy
15.3Gernany
12.6Other EC(15)
13.7
Spain
4.2Other Europe  4.8
Federation 
Russia
2.9China 0,7Other Asia
5.2Other Africa
4.2Other 0.7France
28,1America
2.1
Other Europe 
(15)  6.0
Germany
15.7Spain
4.0Other Europe  
2.2Asia 5.1Other  3.1
Libyan Arab 
Jamahiriya  3.5 Other Africa
4.9
Italy
18.7Europe
81.2Europe
84.8
Asia
         5.9
Europe
79.1Asia
9.4Other America
2.4France
33.1America
2.1
Other EC(15)
6.1
Germany
9.2Spain  6.1Other Europe  1.9Asia 3.1Other 3.1
Libyan Arab 
Jamahiriya   3,6Other Africa
3.2
Italy
25.3Belgium-
Luxembourg
3.1
USA
2.8
France
24.9
Italy
18.9Germany
8.4Other EC(15)
10.8
Spain
5.3Other Europe  6.8
Russia 
Federation
3.0China  2,3Other Asia 7.1Other Africa
2.7Other 0.6
Other 
America 
3.2
America
7.4America
6.0Africa
8.5Africa
6.8
Belgium-
Luxembourg
6.5
Libyan Arab 
Jamahiriya 
3.3Libyan Arab Jamahiriya 
2.6Africa
6.8Africa
6.0
 Tunisia WT/TPR/S/152 
 Page 11 
 
 
(ii) Investment  
23. Between 1990 and 1998, fo reign direct investment (FDI) rose from 78 million dinars to about 
800 million dinars.  FDI then went on to reach 1 139 million in 2002, but has since declined 
(Table I.3).  More than 39 per cent of the sums involved have been invest ed in manufacturing;  
34.4 per cent in the energy industry ; 22.4 per cent in services;  2.8 pe r cent in tourism and property;  
and 1.3 per cent in agricultural activities.9  Generally speaking, FDI co mes mainly from the European 
Union, but also from the United States and the Middle  East.  Altogether, 2,659 foreign enterprises or 
joint ventures are operating in Tunisia, with fore ign investment totalling almost 19 billion dinars in 
2004.  FDI accounts for 10 per cent of productive inv estment and generates one third of exports and 
one job in every six. 
(4) OUTLOOK  
24. The good performance of the Tunisian economy in recent years could continue in the medium 
term if appropriate reforms ar e introduced in order to create a favourable environment for the 
emergence of new growth poles, particularly in services.  These new poles would replace or supplement the textiles and clothing industry which has been experiencing difficulties since the total 
abolition of the Multifibre Arrangement.  There s hould be no decline in the contribution made by 
activities such as tourism, whereas that of agri culture largely depends on the weather.  The 
performance of the oil industry is conditional on tre nds in the world market, although its contribution 
will continue to dwindle as a result of the depletion of reserves. 
25. A further reduction in public debt, as a result of  efforts to trim the budget deficit, together 
with a prudent monetary policy on the part of the BCT, should make it possible to hold inflation at its 
current level.  Continued privatization reforms should help this process by reducing government 
support for state-owned enterprises in difficulty and breathing new life into the industries concerned.  
This should lead to reduced unemployment and great er competitiveness.  The sector that would be 
mainly affected by the privatization reforms would be the services sector, which needs revitalizing in 
order to create the new growth poles mentioned above .  Thus, even in the absence of a substantial 
improvement in the balance of trade, a good perfo rmance by the services account should make it 
possible to balance the external current accounts. 
                                                     
 
 9 "Key figures".  Available at:  http://www .investintunisia.tn/fre/poleA/pole02.html.