New TUNISIANew Democracy
New Opportunities
Motohiro Shimoda, FIPA Tokyo
June 11th , 2014 ＠TokyoWelcome message fromH.E.Mr.Farhad Khlif
Ambassador,
Embassy of the Republic of Tunisia

FIPA
Foreign Investment Promotion Agency (FIPA) is a public
institution under the supervision of the Ministry of
Economic and Finance.
FIPA is in charge of providing all the support for foreign investors, follow up andassistance with various government deparatments and other Tunisian companies nad
regopnal authorities.

Tunisia today (Y+3)

What hasn’t changed(acquired)

What has changed(dynamic)- Strategic geography- Speech and expressions-The millennial history of business-Educated and Passionate people-An Open and welcoming country-The political physiognomy-State governance-Business environment

Year 0Reality I:
Tunisia has finally get rid of its 23 years of dictatorship and of its
image of a stable country thanks to its dictatorship
Tunisia continues to run: public service, machine production, supply
chain
Reality II:Tunisians found the taste of freedom of expression: the press, laborunions, political debate, awareness Emergence of multiple demands: organization, identity…
The country must rebuild its political and social stability
Reality III:The image of Tunisia, as an economic example in Africa, is affected
because of the current fears and uncertainties

Years 2 and 3
Political ambiguities take an unexpected magnitude
the transition process has lost speedpoliticians are called to convinceviolence on political background, worried Tunisians and their partners
people are concerned about their aspirations (employment and dignity)
The decline in ratings puts into question the reliability of TunisiaThe economic activity is affected by social demonstrations
foreign partners begin to doubt about the capacity of Tunisians to boost theslope
Foreign companies are confused between business continuity and the lack ofvisibility
the image of Tunisia is reduced to current facts

Years 2 and 3
However,Foreign Direct Investment has almost regained its pace in 2010
Annual average of closures / creations equals the decade 2000-2010 avg
Hotels experienced overbooking in high seasonsIndustrial exports have increased significantly
Economic growth has gradually recoveredTunisia finds the classification of Davos after an absence of one year
The main actors in the political scene meet to discuss the completion ofthe transition period .
Results (early 2014): New Constitution, New Government,
Lifting of travel restrictions

Tunisia at a glance
Population: 12 millions of inhabitants, Unemployment rate: 15.3%
Capital city : Tunis
Official langage : Arabic Widely spoken langages: French , English, ItalianCurrency: TND, approx = 0.640 USD , 0.498 euro , 62 yen
Climate: Mediterranean ( 10 to 16c in Winter, 30 to 40c in summer season)GDP: 71,379.2 TND million
Growth: 2012
2013
2014*
3.6%
2.7%
3.0% (IMF World Economic Outlook *2014 predicts)
Income per capita: 6,596.7 TND equivalent of 5,000 US$ in purchasing power parity
Main Partner : EU with 80% of imports and exports
Trade balance deficit: 13.4%
FDI flows: US$ 1.0 billion
Current account deficit: 13.4%

A natural advantage… Strategic position

Land connections with immediate neighbors
Free trade agreements with EU, Arab countries, Turkey
Daily air connections to European capital cities
Daily shipping links with the main European ports (Genova, Marseille, Antwerp)

High connectivity, regional hub

Tunis

High connectivity, regional hub• Tunisia, is less than 3 hours flight from major
European capital cities : Paris, Rome, London,Madrid, Brussels• Less than 2h30 from south shore Mediterraneancountries : Algeria, Morocco and Libya• Less than 5 h from major Middle East and sub
Saharan African capital cities• Less than 24 h shipping from major European
harbors (Genova, Marseille, Rotterdam, Antwerp)

Millennial history of business
814 before J.C , First trade port in South Med.
Carthage, the most trading city in the Mediterranean.

1972 , first country to encourage foreign investment (law 72)

1995: first southern Mediterranean country to sign a free trade
agreement with the European Union.

2011: 1st southern Mediterranean country in terms of global
competitiveness.
1st south Med country in terms of laws for the encouragement of IDE

Highly skilled and passionate people
12 million people with indicators of a large nation
Education (girls and boys) absorbed 1/3 of state budget
The highest enrollment rate in the Arab World
Education system qualityAvailability of the latest technologies
Innovation capacity
Scientific research institutions quality
Largest budget is for R&D
Availability of engineers and scientists
Availability of specialised training and high-level services

Highly skilled and passionate people
97% of youth enrollment
365,000 students, 61% ofwhom are girls

Scientists and engineers available
in job market
1 :limited availability
7 : wide availability
5,4

5,3

70,000 new graduates /year

4,5

4,5

4,5

4,5

4,5

4,3

33% of students are oriented
towards computer science
30 R&D centers and 28,000
researchersTunisia FranceTurkey

Morocc Egypt

Germany R.tcheque

Italy

Source : Rapport sur la compétitivité globale 2011-2012, WEF

48% of Tunisian people are under 25 yrs

An open and welcoming country
42 double taxation conventions

7 million tourists per year (4 to 5 mil. since the revolution)
3,100 established foreign companies including 10 JapaneseFree trade agreements with the EU, Turkey and the Arab countries
1st south Med country . « Quality of life index »(according to Int living Mag)

1st south Med country. For its pacifist qualities (EIU)
1st Arab country for teaching foreign languages(English , German, Italian, Spanish, Russian…)

Reliable destination for FDI
FDI inward stock

3,100 international companies
332,000 Jobs

20,000 Mil US$

400 new since 2011

Sectoral repartition of FDI

Tunisia welcome Japanese
10 companies (since 1981)

The 10th industrial employer isjapanese2010 : 13,385 japanese visited Tunisia

Japanese Tourists are back2011 : 3,120 japanese visited Tunisia
2012: 8,002 japanese visited Tunisia
2013: 6,460 japanese visited Tunisia
Q1 2014 : 2,245 japanese visited Tunisia

International confirmed trustFramework conditions and measures
What makes it concrete?
Export Pack (since 1972)

Regions Pack (since 1993)

Tax profit at the reduced rate of 10 % since 2014
Total exemption from income tax in priority ereas
Total franchise from customs duties for imported equipment
Funds and incentives for investment in priority areas
Supported by state employer contributions into the social security system

Soon a new package of incentives in the spirit of Step (new code)Framework conditions and measure
How ease it is ?
Investment is free in major sectors (authorization is the exception)
Recognized ease of business(WB doing business report )Dedicated structures for eachactivity
FIPA, APII, APIA, ONTT, CEPEXLTD : 2hour

SA: 12 H (+ 1 week publication )LTD: no min capital

SA : 3.000 US$ in shares

All the procedures under the same roofFramework conditions et measures
Who to ask for ?

FIPA:
Main counterpart for foreign investor Inform,prospect, assist (non profit public institution)
API: Agency for the Promotion of Industry

APIA: Agency for the Promotion
Agricultural Investment

ONTT: Tunisian National Tourism Office

CEPEX: Center for the Promotion of Exports

Technical structures dedicated for different activities

Framework conditions and measures
How much does it cost?

Biginner Engineer (diploma recognized international y): 800 US$

Skilled worker: 250 US$

Senior technician: 500 US$An international quality of work at very competitive costs

Framework conditions and measures
What about Taxes and duties ?

ISPP: depending on the salary portion : between 0 et 35% or a package of 20%

IS : 30% in general ,10% agriculture and fishing and 35% for the Finances and hydrocarbons
VAT : 18% in general, 6% sensitive products , 12% for products not produced locallyCustomers duties : 0% to 36%

To note : the exporting company pays 10% on the profits (to life).
To note : reinvested benefit are free of tax .

BENEFITS OF INVESTMENT IN TUNISIA
Group area
Priority Area

2nd Group

1st Group

Deduction ofbusiness revenue

100% during thefirst 10 years, nomore than 50%
over another 10years

100% for the 10years

100% for the 5years

Coverage ofemployer’s tosocial security

100% for the first
10 years

100% for 5 years
and decreasing forthe following 5years

100% for 5 years

Financial benefits
in the from ofsubsidies

25% up to a
maximum of 1.5
MTND

15% up to a
maximum of 1MTND

8% up to a
maximum of 0.5
MTND

Coverage ofinfrastructure
costs

85%

75%25%• 1st Group• 2nd Group• Priority Area
• Without encouragement

21 April 2014

Framework conditions and measures
where to invest ?

9 airports and 7 commercial seaports

9 existing poles of competitivenessand 14 planned
100 industrial zones and two
operational competitive parksService facilities
at competitive rental costs

9 International airports
7 commercial sea ports

チュニジアの日本企業
Name of CompanyPlaceIndustry

Memo

SE Bordnetze Tunisia

Bousalem

Wireharness

Bousalem factory open 2011

(Sumitomo Electric)

Bizerte2

Yazaki Tunisia S.A.R.L.

Gafsa

Wireharness

Established2009

3

YKK Tunisia S.A.R.L.

SousseFastening

Established1997

4

Carthago Power Company
S.A.R.L.

Rades

Generate electric

Marubeni Corp 40%

5

Mitsubishi Corporation

Tunis

Trading

Liaison Office6

Itochu Corporation

Tunis

Trading

Liaison Office7

Toyota Tsusho Corporation

Tunis

Trading

Liaison Office8

NEC Corporation

Tunis

Telecommunication

Liaison Office

9Japan Tobacco

Tunis

Tobaccotemporary closed

10

Maruha Nichiro

Tunis

TradingCultivation Tuna fish

11

Tokushukai MedicalCorporation

Tunis

Hospital

Check situation.

12

Yamaichi ElectricTunis

Electric manufacture

R&D Center for Solar (PV: Photovoltaic)

1

Framework conditions and measures
What about the first step?

FIPA your partner,
provides you with credible information on investment environment
FIPA your partner,
assists you to better know Tunisia: partners, incentives, procedures

FIPA your partner,
Grants you necessary after care services

Thank You forYour Attention
www.investintunisia.tn