Tunisia's miracle starting to fall apart

Yomna Abo Ouf, Salma Hussein, Wednesday 29 Dec 2010

The current riots over unemployment are exposing the cracks in the country's economic and political stability

Can Ben Ali heal the social ills? (Photo : Reuters)

Unjust, unable to create enough good jobs and too reliant on foreign investors. Tunisia's economic model, once hailed, is exposing its weaknesses. 

Tunisia’s economic development since the late 1980s has often been described as a miracle.

“The fruits of progress have enabled Ben Ali to secure the support both of the middle class (whose standard of living has indeed steadily improved) and of his foreign partners (whose multinational companies find advantages in Tunisia’s lower labor-costs and tax-rates),”Amel BouBekeur wrote in an article on Tunisia published in 2009 on the Carnegie Foundation's website.

BouBekeur, a research fellow at the Centre for European Policy Studies, views Tunisia as a distinct case within the region. It does not formally reject western democratic standards and its open-market policies and containment of Islamist encourage its European and American partners “with an economically stable and secure environment.”

At the same time, she adds, this model of governance allows the president - operating through his party, the Democratic Constitutional Rally (RCD) - to present a benign face to the world while consolidating firm control over the country.

Nevertheless, this stability was revealed to be a fragile one after thousands of unemployed and frustrated Tunisians rioted in a country where the government's firm grip on makes protest an uncommon sight.

President Ben Ali described the protestors as a minority. "The use of violence in the streets by a minority of extremists against the interests of their country is not acceptable," he said in a speech broadcast by Tunisian television on Tuesday. The unemployed, however, cannot be viewed as a minority.

Unemployment is the mother of anger. Yet many reasons can explain the tragic turn.

On top of it is the growing divide between the wealthy, tourist-oriented, north and the “sulky” south.

"The weakness of the development model has caused inequality between regions, as witnessed by the fact that 90 percent of (investment) projects are in coastal areas, and 10 percent in the interior," opposition leader Rachid Khechana told Reuters.

The southern region, less touristic than the north and traditionally more hostile to Ben Ali, receives little or nothing in the way of infrastructural support or social services.

Peaceful protests against this situation are often suppressed.

In 2008, peaceful protests by workers of the southern mining region of Gafsa against their working conditions were violently suppressed by the authorities and eighteen trade unionists were subsequently sentenced for up to ten years.

As a consequence of the regional disparities, recent years have seen the migration of thousands of graduates from the poorer interior to coastal cities in search of work. Many come to Sousse, Sfax and Meknassi, trying to find work.

Mohammed Bouazizi was among the migration. A week ago he doused himself in petrol and set himself alight.

Other than the regional disparities, the country's pattern of growth - relying on textile and tourism - is heavily dependent on low-skilled labor and hence excludes the better educated.

Textiles are a major source of foreign currency revenue, with more than 90 percent of production exported, according to the official government website.

Investment in education has seen soaring numbers of graduates passing through the country's universities, from 41,100 in 1986 to over 357,400 in 2009. This trend has not been met by a corresponding rise in demand for highly skilled, notes a recent study published by Carnegie Foundation.

As a result, four out ten young graduates are now unemployed.

"Mismatch between the supply and demand of the labor market in Tunisia, is one of the major forces of the aggravated protest that spread all over the country," says Nadia Belhaj, senior economist at the Economic Research Forum.

These clashes show how the unemployment rate contradicts with the country's steady growth rate.

In the last year, the Tunisian economy grew by 3.8 percent, not enough, according to the International Monetary Fund (IMF), to make a serious dent in a 14 percent unemployment rate.

On top of all these factors is the economic crisis afflicting the European Union, "causing exports and labor remittances to fall, which affected the labor market in Tunisia", adds Belhaj.

This view is further enforced by an IMF report in September predicting that the downturn in Europe could cast a shadow over Tunisia’s outlook.

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