Struggling Tunisia appeals to world for investment

AP News
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Posted: Sep 08, 2014 1:12 PM
Struggling Tunisia appeals to world for investment

TUNIS, Tunisia (AP) — Tunisia's prime minister on Monday called for greater foreign investment to help support the country's ailing economy and the transition to democracy.

Tunisians overthrew their dictator in 2011 and are set to complete the democratic transition with autumn elections, but the economy is beset by high unemployment, low growth and inflation that is making daily life difficult in this country of 10 million.

"Investing in Tunisia, is an investment in democracy, in peace and in all the Tunisians who reject extremism and believe in tolerance," said Prime Minister Mehdi Jomaa at the opening of a conference about investments in the country.

The conference was attended by representatives of 30 countries, including French Prime Minister Emmanuel Valls, and the prime ministers of North African neighbors, Morocco and Algeria.

"At the time when chaos is threatening Libya, where barbarity is rampant in Iraq and Syria, Tunisia needs all of our support to move forward on the path to democracy," said Valls, adding that 1,300 French companies have invested in Tunisia, creating 4,000 jobs last year.

Economy Minister Hedi Larbi also announced that 22 major projects, worth $6.8 billion dollars, are in the works, including a new deep water port and a dam.

The economic crisis in Europe hit Tunisia's main trading partners hard, bringing down exports, while post-revolutionary instability and scattered terrorist attacks discouraged investment.

The central bank last week said the 2014 growth rate is expected to be just 2.8 percent, not remotely enough to address the 15.7 percent unemployment rate.

While the number of jobless has shrunk slightly since the revolution, the number of those living below the $2 a day poverty line has grown from 10 percent to 15.5 percent of the population.

The biggest complaint for most Tunisians, however, has been a runaway inflation of between 6.5 and 7 percent that has pushed up the price of food.

The economy has received key support from the International Monetary Fund which began releasing disbursements of a $1.74 million Stand By arrangement earlier this year after Tunisia resolved its political deadlock.

The fund on Aug. 29 approved a $217 million dollar disbursement, bringing the total loaned so far to $1.1 billion.