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Tunisia - Overview

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Capital:: Tunis
Area:: 164 km2
Total Population:: 10.778
Annual growth rate:: 1.00%
Density:: 69.00/km2
Urban population:: 67%
Population of Tunis (3.980), Sfax (265), Nabeul (170), Kairouan (120)
Official language: In Tunisia, Arabic is the official language. The Arabic which all Tunisians speak in their everyday communications is a dialectal variety called Tunisian Arabic.
Other languages spoken: 98 % of the population speak Arabic, the rest speak Berber. French is also spoken by a large majority of Tunisians.
Business language: English is not very common. French is the language used in trade, and for some administrative texts. German and Italian are spoke by many people in Tunisia.
Ethnic Origins:: 98% Arabs, 1% Europeans, Jews and others 1%.
Beliefs: Muslims 98%, Christians 1%, Jews 1%
Telephone codes:
To make a call from: 0
To make a call to: +216
Internet suffix:: .tn
Type of State::
According to the terms of the Constitution, Tunisia is a free State, sovereign and independent. Its religion is Islam, its language Arabic and its regime a Republic. The power instituted by the Constitution is founded on the sovereignty of the people and the separation of powers. The regime it establishes is the republican regime.
Type of economy::
Lower-middle-income economy
French colony up to 1956 and is now having strong economic ties with the European Union. An economy based on agriculture, the mining and energy sectors and tourism.

Economic overview

Although over the past decade, Tunisia had an average annual growth of around 5%, the international economic crisis of 2008-2009 and subsequently the socio-political revolution that erupted in the country in early 2011, the crisis in the eurozone and the civil war in Libya have considerably worsened the situation. The country entered into recession in 2011 (-1.8%), then the economy recovered. For 2013, growth was estimated to be 2.6% and the government predicts a 4% growth in 2014 as well, although this forecast is seen as unrealistic.

In 2013, the political crisis, which was made worse by the murder of two Tunisian high-level politicians, had a negative impact on both economic growth and creditor and investor confidence. The givernment, dominated by the Islamist Ennahdha parti, was forced to announce that it would resign in favour of a technocratic administration and as a result of the national dialogue a new prime minister was chosen: Mehdi Jomaa, previously an engineer without any known party affiliation. The slow political transition also resulted in a late disimbursement of the IMF financial aid and public finances deteriorated. The deficit increased from 1% of the GDP in 2010 to 5.9% in 2013, public debt deepened (49%) and financial reserves were exhausted. The 2014 budget, 2.3% higher compared to 2013, foresees an increase in tax revenues and a relative freeze on spending (especially on management, relative to wages and subsidies). It also includes tax exemptions for low-income social categories, a 10% taxation on export-only companies and measures to improve transprency in financial transactions. Spending on developmental projects has been increased by 17%. The compensation budget for food and energy prices was cut to 22% compared to the year 2013. The aim is to maintain the budget deficit at around 6.5% of the GDP, as opposed to 7.5% in 2013. The first tranche of the precautionary loan granted to Tunisia by the IMF was signed in June 2013 and will be released in 2014; the government has also been negotiating a 300 to 500 million EUR loan with the European Union.

In purchasing power parity, Tunisia is close to the income levels of developed countries. Progress has also been made in terms of life expectancy, the place of women in society, or health infrastructure and education. The official unemployment rate has increased as a result of the crisis (17%), and remains higher among young people, especially among young graduates whose unemployment rate exceeds the average rate by 3 to 5 points.

Main industries

Agriculture is a key sector of Tunisian economy and an improvement in its production in the past years has allowed for the development of the sector (cultivation of olive trees, fruit trees and palm trees) and also has enabled to the country to reach a level of food sufficiency. Organic farming is also booming, Tunisia being the second most productive country in this respect. Agriculture accounts for around 8% of the GDP and employs around 25% of the workforce. This performance is the consequence of large-scale support and modernization efforts made within the framework of a development policy and of agricultural and rural activities regulation.

The non-manufacturing industries account for 17% of the GDP. The manufacturing industries, mainly textile and food, make up 20% of the GDP and are damaged mostly by the Asian competition. They are predominantly orientated towards export.

The local economy is largely orientated towards services, which account for 58% of the GDP, including the booming sectors of ICT (Information and communication technologies) and tourism.

Foreign trade overview

Tunisia has an open economy, foreign trade representing more than 105% of its GDP (average for 2010-2012). Until the 2011 crisis, the country was pursuing a policy of economic and opening and has signed an association agreement (summary in French) with the European Union, removing tariff and trade barriers on most goods. It also signed a Trade and Investment Framework Agreement (TIFA) with the United States, which will later become a free trade agreement.

The current account of Tunisia is structurally negative and this trend should continue to worsen. The trade deficit worsened in 2013 due to the sharp increase of food and energy imports.

Tunisia's main import and export partners are the European Union, Libya, Russia and China. France remains its first supplier. Tunisia's main export goods are textile and leather, mechanical and electrical products, food products and energy products. The country imports raw and semi-finished materials, equipment goods, consumption goods (other than food) and financial and insurance services.


FDIs currently represent 10% of productive investments, generate one third of the exports and 15% of the total number of jobs. According to the 2013 World Investment Report, Tunisia is among the top 15 destinations for FDI flows in Africa. After a decline in the recent years due to the global recession, the country's socio-political revolution and the crisis in the euro zone, FDIs recovered in 2012, growing by 79% compared to 2011. In 2013, they fell by 24%. The government is hoping for a recovery in foreign investment with the help of the new Investment Code and the tax decisions it contains.

The main investment sectors are textile, computer science, corporate services, energy and tourism. The sectoral distribution today shows a definite orientation towards industrialization.

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