Tunisia after 30 years of cooperation with the EU

Thirty years ago, Tunisia was the first Mediterranean country to sign a financial agreement with the European Union. Other countries from the South took Tunisia as an example in this matter. But how did Tunisia benefit from this cooperation?

Samira Sadfi - Tunis, Al-Hayat

Tunisians look differently at the way they could have benefited from neighborhood relations with Europe, yet, they all agree that three decades of cooperation with the European Union helped boost the country, which was the first one in the South Mediterranean to sign an association agreement with the EU. One can even go on to say that history and geography played a positive role in tightening relations between Tunisia and Europe. It is a fact that Tunisia is geographically open to Europe and its shores are less than 60 miles away from Italy. Flights from Tunisia to Rome or Nice do not last more than one hour. Furthermore, since the Roman times, Carthage and Rome were competing even on the economic level. Once independent in 1956, Tunisia established cooperation ties with Europe, with more than 80% of its trading activity done with European partners.

Bilateral cooperation
In 1979, a European Union delegation was formally opened in Tunisia and cooperation was characterized by closer ties. A bilateral neighborhood plan was later on concluded in the year 2005 and strategic objectives for cooperation were defined. Adrianus Koetsenruijter, Head of the European Union Delegation in Tunisia told Al-Hayat that Tunisia signed the first trading agreement with the European Economic Community (ECC) in 1969. It was then followed by a cooperation agreement signed in 1976. In the eighties, several cooperation agreements on the financial and technical levels were signed between both parties. This paved the way for stronger economic ties embodied in the Mediterranean-European Development Agreement (MEDA) plan, stretching from the beginning of the nineties to the year 2006. Koetsenruijter to add that Europe began to fund projects in Tunisia as of 2007 via the new instrument called ENPI (European Instrument & Partnership Instrument).

How did this cooperation benefit Tunisia? In fact, trade, educational, agricultural, environmental, training and energy projects were implemented. Following the signature of the association agreement in 1995, the EU helped improve the industry, telecommunications, roads, education and training centers, purification stations and helped implement law reforms in the country to ease the integration of Tunisia in the world economy. As a result of this cooperation, it is estimated that the total amount of non-reimbursable funds allocated for projects in Tunisia from the year 2005 to date reach 1.25 billion Euros. Broader cooperation will be developed this year with a plan to manage water resources destined for field irrigation. A similar plan will be introduced to rationalize energy consumption in a country that suffers from scarce oil resources.

Modernization plans targeted as well the industrial field, as local enterprises were supported to modernize their production, in order to be able to export to European markets. This support helped Tunisian products resist the competition of similar products exported to European markets, namely textiles and apparel.

Koetsenruijter considered that the Lisbon agreement, which came into effect last year, opens the way to Mediterranean partners such as Tunisia for broader cooperation and integration in foreign markets. He placed emphasis on the industrial modernization plan, which contributed since the year 2003 in developing local production, with a total fund of 50 million Euros. The success of the reform in this sector constituted an example to follow for other countries of the south of the Mediterranean.

In fact, according to figures published by the Tunisian Ministry of Development and International Cooperation, the EU support helped modernize more than 800 local industrial enterprises in the country. It is worth noting that the support was not limited to the modernization of technical equipment. Efforts were exerted as well to enhance the quality of production to meet international specifications. Managerial, financial and marketing reforms were also introduced in this sector. As a result, 200 Tunisian enterprises were able to produce in line with international specifications. This certification paves the way for those enterprises to export their production to European markets, where they have to compete with similar products produced in Asian countries and in Eastern European countries, which lately joined the European Union.

A new phase
Prospective studies make Tunisians believe that they will move to a new phase in their partnership with the European Union. After completing the rehabilitation of the industrial sector and finalizing the free trade agreement on industrial products, Tunisians will negotiate an agreement to liberalize trade in services as well as, later on, in agricultural production. Head of the Tunisian-French Chamber of Commerce and Industry, Fouad Al-Ekhwa told Al-Hayat that the plan for the rehabilitation of organizations working in the service sector launched last May is going along with negotiations held between Tunisia, the European Union and the World Trade Organization aiming at liberalizing trade in services. He also added that the rehabilitation plan is targeting 100 private enterprises working in the health sector, general services, telecommunications & information technology, and transport. Some European diplomats were quoted as saying that the industrial reform in Tunisia, funded by the European Union, helped the government set a plan (stretching up to the year 2016) to modernize the sector. The European Union plans, on the other hand, to launch a new program to modernize education and training in an effort to respond properly to the market needs.

High ranked officials at the EU delegation in Tunisia noted that the EU established a laboratory specialized in providing local research and technological centers with the help offered by the EU. This is part of the non-financial support that the EU is offering and that focuses on knowledge and research, rather than infrastructure and raw material. Due to the fact that Tunisia is known for the scarcity of its natural resources, it is expected that the EU will give it a further boost to excel in research and innovation by facilitating cooperation with Europe in this field.

An initiative to settle disputes
It is worth noting that the Tunisian Minister of Trade, Rida Bin Mesbah, succeeded along with officials in the European Union in finding a common ground to settle trade conflicts between the 2 parties. This agreement is considered as the first of its kind with a Mediterranean partner, since Barcelona agreement. The new agreement aims at implementing free trade between Tunisia and the European partner countries in the services sector and agricultural produce. In fact, these sectors were not included in the partnership agreement signed between both parties in 1995 and fully implemented in its last stipulations at the beginning of this year 2010. Officials in the Tunisian Ministry of Trade said that both parties will work together, according to the new agreement, to find common legislative grounds and erase all obstacles that hinder the progress of trade between the two parties.

Last year, 50% of investments in Tunisia came from the services sector. The sector contributed in 60% of the country’s Gross Domestic Product. Also, 100 local companies working in the trade and services sector benefitted from the rehabilitation and modernization plan supported by the European Union. It is also expected that this sector will constitute by the year 2016 the backbone of the Tunisian economy, as its contribution to the GDP will rise to 64% and to 53% in investments.

See also: EU and Tunisia: course of relations