14 January 2013

Tunisia, Two Years On


The fall of Tunisia's authoritarian regime two years ago brought hopes of major change in the North African country. Today, some disenchantment can be felt.

Take the labour market situation: Since 2010, the unemployment rate has increased by four percentage points to 17 per cent. Young people, including graduates, are hard hit, and the crisis in advanced economies is making it more difficult for them to find decent jobs abroad. Social unrest - which often marks periods of political change - is still high and risks paving the way for populist solutions.

Yet, there are grounds for hope. The economic and employment situation improved slightly in recent months, partly thanks to a better than expected tourism season. More fundamentally, Tunisia is building a new social contract. Implementing it is taking time and will undoubtedly try Tunisians' patience, but it is crucial.

Trust in political leaders and confidence that living conditions will improve for everybody are essential ingredients of a stable society.

Tunisia is moving on both fronts.

Work on a new Constitution is moving ahead. There are plans to reinforce the independence of the judiciary and other institutions that tackle corruption. Key sectors like telecommunications and some services are becoming more open to new investment, breaking monopoly situations.

Social dialogue is now regarded as an essential pillar of good governance.

As for living conditions, the government has adopted a comprehensive set of measures to boost employment. An employment strategy has been launched. It addresses controversial issues like labour market reforms, the informal economy and social protection in a balanced manner, and includes specific measures for disadvantaged groups.

Tunisia also has important economic and social assets. Its economy is relatively diversified and includes agro-food, industrial and tourism sectors which, if properly encouraged, could become the backbone of a new era of development. The health and education systems are efficient and the role of women in the economy is greater than in other developing countries. Strong representative organisations for employers and workers make it possible to voice dissatisfaction over the present situation, but should also facilitate implementation of the new social contract.

In short, Tunisia's new social contract could lead to shared prosperity.

There is no doubt that such a strategy will pay off in the medium term.

The problem is that the difficult employment situation is fuelling social unrest. Urgent responses are needed to avert the rise of populist solutions that would compromise the achievements of the revolution.

What can be done to improve the employment outlook quickly while maintaining the reform momentum?

There is no simple solution. Perhaps Tunisia could be offered breathing space through improved access to other markets, including those of successful emerging economies. Another approach would be to move towards a faster economic integration in Northern Africa. Experience from Latin America and East Asia shows that such regional integration can help cushion a crisis. Development loans tied to the completion of the reform process may also be considered. And mobilising ILO expertise in the area of decent-work-friendly policies could help support Tunisia's effort to engage in a more inclusive development model.

Raymond Torres is Director of the ILO's International Institute for Labour Studies.

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