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Economic and political overview

Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Tunisia was deeply impacted by the Jasmine Revolution of 2011 that ousted president Zine El Abidine Ben Ali, and the country has never recovered economically. The situation was exacerbated by the health crisis triggered by the COVID-19 pandemic and by the political crises that the country has been experiencing in recent years. According to IMF estimates, economic growth stood at 2.2% in 2022, as the war in Ukraine and rising international commodity prices worsened the existing vulnerabilities of Tunisia’s economy, contributing to a sharp increase in the trade deficit. For 2023, the IMF expects growth to further decelerate to 1.6%, before picking up marginally in 2024 (2.1%).

Tunisia received financial assistance from several international organizations, such as the African Development Bank, the IMF, and the European Union (which disbursed EUR 600 million in loans under the Macro-Financial Assistance emergency support programme). In October 2022, the IMF and the Tunisian authorities have reached a staff-level agreement to support Tunisia's economic policies with a 48-month arrangement under the Extended Fund Facility of about USD 1.9 billion, in an effort to restore Tunisia’s external and fiscal stability. In fact, the country's public finances have suffered in recent years, with the government deficit reaching 6.8% of GDP in 2022 also due to subsidy spending for energy and food (that accounted for 2.8% and 0.4% of GDP respectively, according to the World Bank). Similarly, the debt-to-GDP ratio rose to 88.8% (from 81.8% one year earlier) and is expected to increase marginally in 2023, to 89.2% as per the IMF forecast. The majority of the high external debt is public or public-guaranteed, which may cause doubts about the country’s ability to service its debt. Inflationary pressures increased significantly, mainly from global markets and higher administered prices, resulting in an overall rate of 8.1% in 2022. The Central Bank of Tunisia raised its policy rate by 75 basis points by the end of the year, to 8%, in its third increase of 2022; nevertheless, the IMF expects the inflation rate to remain high over the forecast horizon, at 8.5% this year and 7.9% in 2024. The pressure on the dinar against the dollar increased but the level of foreign exchange reserves has remained stable. Among the policies necessary to restore macroeconomic stability the IMF points to a conscientious reduction of the fiscal deficit through equitable taxation reform, strict control over the public sector wage bill, better-targeted subsidies, and deep reforms of state-owned enterprises.

Tunisia is afflicted by increasing economic disparities that favour its coastal regions, which account for more than 80% of urban areas and 90% of overall employment. The highest poverty rates are concentrated in rural areas, especially those in the northwest and southwest of the country (often exceeding 33%). Contrarily, the greater Tunis area shows the lowest values (Carnegie). According to the latest figures from the National Statistics Institute (INS), as of Q3/2022, the unemployment rate stood at 15.3%; nevertheless, youth unemployment – at 37.8% - was particularly high.

 
Main Indicators 202020212022 (E)2023 (E)2024 (E)
GDP (billions USD) 42.5446.6946.6049.8251.53
GDP (Constant Prices, Annual % Change) -8.84.42.51.31.9
GDP per Capita (USD) 3,5743,8853,8424,0724,177
General Government Balance (in % of GDP) -7.2-6.5-7.2-4.6-3.8
General Government Gross Debt (in % of GDP) 77.679.979.480.079.1
Inflation Rate (%) 5.65.78.310.99.5
Unemployment Rate (% of the Labour Force) 17.416.20.00.00.0
Current Account (billions USD) -2.51-2.78-3.98-3.55-2.92
Current Account (in % of GDP) -5.9-6.0-8.6-7.1-5.7

Source: IMF – World Economic Outlook Database , October 2021

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Agriculture is a key sector of the Tunisian economy, accounting for 10.1% of GDP and employing 14% of the workforce (World Bank, latest data available). The country has 9.7 million ha of agricultural land, equivalent to 62% of its total land area (FAO). An improvement in production methods in recent years has allowed the sector to develop and modernise (cultivation of olive trees, fruit trees and palm trees) while enabling the country to reach a level of food sufficiency. Organic farming is also booming, with Tunisia being one of the most productive countries in Africa. Olive oil accounts for the largest share of agricultural exports, followed by dates, olives and fresh fruits. According to the latest figures from the National Observatory for Agriculture, the value added of the agricultural sector increased by 2% year-on-year in the second quarter of 2022, following a 3.3% increase recorded in the first quarter.

Industry represents 23.1% of the GDP and employs 33% of the active population. The country's industrial sectors are predominantly export-oriented. Among sectors in decline, there are the leather and shoe industry, paper, cardboard, plastic, and wood. The chemicals and textiles and clothing sectors had been growing in recent years; however, the economic crisis triggered by the Covid-19 pandemic impacted especially the textile and clothing sector and the mechanical and electrical engineering sub-sectors, which are still recovering. Overall, the manufacturing sector is estimated to account for 14% of GDP (World Bank). According to the latest figures from the National Statistical Institute, in Q3/2022, industrial production fell by 1.2% compared to the previous quarter, due to the decline recorded in the manufacturing (-0.5%) and in the mining and quarrying industries (-4.8%). Production was also down in the energy sector (-3%), the agricultural and food industries (-4.6%), mining (-15.9%), and the oil refining sector (-7.5%).

The local economy is largely orientated towards services, which account for 60.1% of the GDP, including the booming sectors of ICT (information and communication technologies) and tourism. Professional training and research are both rising sectors. The services sector as a whole employs 53% of the country's workforce. The tourism industry is also important to the country’s economy: after suffering from the international restrictions imposed during the COVID-19 pandemic, it showed signs of recovery in 2022 when Tunisia received 6.12 million tourists, marking a sharp increase of 159% compared to the previous year. Nevertheless, tourist arrivals were still 32% lower than in 2019, when the country welcomed a record 9.43 million tourists (data by the National Tourism Office).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 13.8 33.5 52.8
Value Added (in % of GDP) 10.1 23.1 60.1
Value Added (Annual % Change) -2.5 8.6 4.0

Source: World Bank - Latest available data.

 
Monetary Indicators 20162017201820192020
Tunisian Dinar (TND) - Average Annual Exchange Rate For 1 USD 2.152.422.652.902.81

Source: World Bank - Latest available data.

 

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Foreign Trade

Tunisia's foreign trade represents 94% of its GDP (World Bank, latest data available). Wire and cable manufacturing continues to be Tunisia's main exporting industry (13.3% of all exports), followed by textiles, petroleum by-products, olive oil, parts of vehicles, and plastics. Hydrocarbon products comprise Tunisia's main imports by far, followed by vehicles, electric apparatus, wheat, transportation and travel (data Comtrade).

The European Union is Tunisia's main trading partner, accounting for 67,5% of its exports and 44.2% of its imports. On a country level, exports are mainly directed towards France (24.1%), Italy (18.4%), Germany (12.8%), Spain (4.1%), and Libya (3.9%); whereas imports come chiefly from Italy (13.5%), France (11.4%), China (10.4%), Germany (6.5%), and Turkey (5.4%). Tunisia has pursued an active policy of enhancing its trade with the rest of Africa. In this regard, Tunisia signed a new trade cooperation agreement with Ghana in 2019. In the same year, the Tunisian Parliament ratified the country's official accession to the Common Market for Eastern and Southern Africa (COMESA, a joint free trade area with twenty member states stretching from Libya to Swaziland). Furthermore, Tunisia is seeking to join the Economic Community of West African States (ECOWAS) and is a signatory to the African Continental Free Trade Area (AfCFTA). Click here for a list of the FTAs signed by Tunisia.

Tunisia's trade balance is structurally negative: according to the World Bank, the deficit stood at around 10.1% of GDP in 2021. In the same year, exports reached USD 16.6 billion (+20.8%), with imports increasing at a similar pace (+22.5%), totalling USD 22.5 billion. Concerning services, exports stood at USD 2.7 billion against USD 2.5 of imports (+26.5% and +18.9% y-o-y, respectively). According to the latest figures from the National Statistical Institute, in 2022, exports progressed by +23.4% reaching TND 57.5 billion (around USD 18.8 billion). As for imports, they increased more rapidly (+31.7%) and reached TND 82.7 billion (around USD 27.1 billion). Consequently, the trade deficit worsened from TND 16.2 billion in 2021 to 25.2 billion in 2022. In the same year, the coverage rate lost 4.7 points compared to the year 2021 to reach 69.5%.

 
Foreign Trade Values 20172018201920202021
Imports of Goods (million USD) 20,65422,70521,55518,35122,488
Exports of Goods (million USD) 14,20415,53414,93313,81316,689
Imports of Services (million USD) 2,7802,9902,8542,1712,583
Exports of Services (million USD) 3,1193,6974,0362,1472,718

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20172018201920202021
Foreign Trade (in % of GDP) 95.8103.9102.384.294.4
Trade Balance (million USD) -5,369-6,045-5,498-3,535-4,665
Trade Balance (Including Service) (million USD) -5,145-5,406-4,372-3,586-4,526
Imports of Goods and Services (Annual % Change) 4.12.5-8.4-16.610.9
Exports of Goods and Services (Annual % Change) 4.84.6-4.2-20.011.8
Imports of Goods and Services (in % of GDP) 54.158.456.446.352.2
Exports of Goods and Services (in % of GDP) 41.745.546.038.042.1

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20222023 (e)2024 (e)2025 (e)2026 (e)
Volume of exports of goods and services (Annual % change) 4.11.63.53.73.5
Volume of imports of goods and services (Annual % change) 5.33.64.44.04.2

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Tunisia is a member of the following international economic organisations: IMF, Arab Fund for Economic and Social Development (AFESD), ICC, Arab Monetary Fund (AMF), WTO, G-77, Arab League, among others. For the full list of economic and other international organisations in which participates Tunisia click here. International organisation membership of Tunisia is also outlined here.
Free Trade Agreements
The complete and up-to-date list of Free Trade Agreements signed by Tunisia can be consulted here.
 

Main Partner Countries

Main Customers
(% of Exports)		 2021
France 24.1%
Italy 18.4%
Germany 12.8%
Spain 4.1%
Netherlands 2.6%
See More Countries 38.1%
Main Suppliers
(% of Imports)		 2021
Italy 13.5%
France 11.4%
China 10.4%
Germany 6.5%
Türkiye 5.4%
See More Countries 52.8%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Kaïs Saïed (since 23 October 2019)
Prime Minister: Najla Bouden Romdhane (since 11 October 2021)
Next Election Dates
Presidential: 2024
Assembly of the Representatives of the People: December 2024
Current Political Context
Tunisia is characterised by a very unstable political context. In October 2019, Kais Saied won the presidential elections over Nabil Karoui and seized exceptional powers in the context of social unrest due to the worsening economic situation caused by the COVID-19 pandemic. In September, Saied suspended the legislature and secured public backing in a July 25th 2022 referendum for a new constitution that weakens the parliament's powers in favour of the presidency. In fact, the new government does not need the approval of the parliament, and cannot be censored without a two-thirds majority of both parliament and a council of regional representatives, whose structure has yet to be defined. The first round of the parliamentary elections that took place in December 2022 saw just 11.2% of registered voters take part, the lowest turnout of any national vote since the 2011 revolt that overthrew Zine El Abidine Ben Ali. Most political parties have been sidelined by a system that bans candidates from declaring allegiance to a political grouping and called for a boycott of the elections, whose second round should take place at the end of January 2023.
Main Political Parties
There are hundreds political parties. The two dominant parties:
- Ennahda: moderate Islamist
- Nidaa Tounes: secular, modernist, concerned with security

Other noteworthy parties:
- Popular Front: leftist; formed by fusion between socialist, progressive, green, and Arab nationalist parties
- Afek Tounes: centre-right, secular, liberal
- Tahya Tounes: secular, liberal, bourguibis
- Machrouu Tounes: big tent secularist
Executive Power
The President of the Republic is the Head of State. The President is elected for five years by universal, free, direct and secret suffrage, and by an absolute majority of the votes cast. The President creates general policies in regard to national security, international relations, and defence. He sees to the regular functioning of the constitutional public authorities and ensures the continuity of the State. The President is limited to a four-term mandate. The President nominates the Prime Minister, who is the Head of Government. The Prime Minister is normally selected from the members of the party or electoral coalition that obtained the highest number of seats in the parliamentary elections. The Prime Minister appoints the ministers and Secretaries of State; however, the Ministers of Foreign Affairs and Defence are designated with the accord of the President.
Following a 2022 constitutional referendum, the President has now more powers since he is in charge of appointing the prime minister and the government members, without the need to seek the approval of the parliament, and cannot be censored without a two-thirds majority of both parliament and a council of regional representatives. Furthermore, the president can dismiss the members of the government unilaterally.
Legislative Power
The people exercise legislative power through a representative assembly, the Assembly of the Representatives of the People, or by referendum. The Assembly is composed of 217 deputies elected by universal, free, direct and secret suffrage for a five-year term.
The new 2022 constitution created a second chamber of parliament called the Council of Regions and Districts. It consists of people elected by members of the regional and district councils instead of by universal suffrage (art. 81). Overall, the new constitution weakens the powers of the parliament, which can still draft and enact laws but can only pass a motion of no confidence in the government with a two-thirds majority.
 

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COVID-19 Country Response

COVID-19 epidemic evolution

To find out about the latest status of the COVID-19 pandemic evolution and the most up-to-date statistics on the disease in Tunisia, visit the official portal on COVID-19 of the Ministry of Health, which also provides data on the geographical distribution of the epidemic in the country.
For the international outlook you can consult the latest situation reports published by the World Health Organisation as well as the global daily statistics on the coronavirus pandemic evolution including data on confirmed cases and deaths by country.
Sanitary measures
To find out about the latest public health situation in Tunisia and the current sanitary measures in vigour, please consult the dedicated pages on the official portal on COVID-19 (in French). For further information visit the website of the Ministry of Health and the portal of the National Observatory of New and Emerging Diseases (ONMNE) on COVID-19.
Travel restrictions
The COVID-19 situation, including the spread of new variants, evolves rapidly and differs from country to country. All travelers need to pay close attention to the conditions at their destination before traveling. Regularly updated information for all countries with regards to Covid-19 related travel restrictions in place including entry regulations, flight bans, test requirements and quarantine is available on TravelDoc Infopage.
It is also highly recommended to consult COVID-19 Travel Regulations Map provided and updated on the daily basis by IATA.
The US government website of Centers of Disease Control and Prevention provides COVID-19 Travel Recommendations by Destination.
The UK Foreign travel advice also provides travelling abroad advice for all countries, including the latest information on coronavirus, safety and security, entry requirements and travel warnings.
Import & export restrictions

For the up-to-date information on all the measures applicable to movement of goods during the period of sanitary emergency due to the COVID-19 outbreak (including eventual restrictions on imports and exports, if applicable), please consult the website of the Tunisian Customs Authority (in French and Arabic).
For a general overview of trade restrictions due to COVID-19 pandemic in the world, please consult the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
Economic recovery plan

For the information on the economic recovery scheme put in place by the Tunisian government to address the impact of the COVID-19 pandemic on the national economy, please visit the website of the Ministry of Finance (in French and Arabic). For a summary in English of the economic and fiscal measures in vigour, consult the dedicated page from KPMG.
For the general overview of the key economic policy responses to the COVID-19 outbreak (fiscal, monetary and macroeconomic) taken by the Tunisian government to limit the socio-economic impact of the COVID-19 pandemic, please consult the section dedicated to Tunisia in the IMF’s Policy Tracker platform.
Support plan for businesses
For the information on the local business support scheme established by the Tunisian government to help businesses to deal with the economic impacts of the COVID-19 epidemic on their activity, please visit the website of Invest in Tunisia and that of the Ministry of Industry (in French). To obtain more details on the support measures for businesses, consult the relevant BDO report.
For a general overview of international SME support policy responses to the COVID-19 outbreak refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.
Support plan for exporters
For the up-to-date information on possible support plans for exporters in Tunisia, if applicable, please consult the website of Invest in Tunisia, as well as that of the Ministry of Trade.
 

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