Tunisia: IACE paves the way for resilience after the Russian-Ukrainian conflict

Tunis/Tunisia — Tunisia, which faces budgetary pressure and lacks additional resources for ambitious resilience programs, needs better national coordination and the development of regional programs to cope with the new energy supply shock. raw materials, including grain and energy, caused by the Russian crisis. – Ukrainian conflict.

The country could, with regard to gas, benefit from the increase in Algerian exports through the national territory and the increase in the production of liquefied gas in the coming years, indicates a note from the Arab Institute of Chefs d’entreprise (IACE), released on Thursday, April 13, 2022.

“Tunisia should focus on preparing for the new cereal campaign by encouraging farmers by doubling purchase prices for the coming campaign and setting up a 100 MD line of credit for cereal crops” , also recommends the IACE, in this note which evokes four post-conflict trends: The warming of stagflation, the New World Order, a new globalization and inclusive resilience.

“These efforts will need to be coupled with technical assistance mainly for small farmers and the provision of adequate seeds.”

The note, entitled “After the war, new trends”, maintained that in the absence of direct support from the State for companies to secure their supplies, Tunisian companies should explore new modes of organization, regrouping in the form central purchasing, etc. consolidate their positions and mitigate the impact of the crisis.

“At the same time, it is important to adopt measures to further improve the business climate and reduce distortions and barriers, in particular by reducing the costs linked to logistics (port, etc.), simplifying administrative procedures, speeding up customs procedures, improving access to finance.

For Tunisia, resilience cannot be managed or ensured solely by state budget interventions. It will certainly require a readjustment of production chains, a reduction in external dependence and a search for alternatives either in terms of consumption capacity, production capacity or processes.

The IACE recalls that in terms of food products, Russia and Ukraine are respectively the leading and fifth wheat exporters in the world. The two countries are also among the five largest grain exporters in the world. According to a note from the FAO, prices would increase by 8.7% in a moderate scenario and by 21.5% in a pessimistic scenario.

The surge in prices could affect several countries.

Indeed, more than 30 economies depend on exports from Russia and Ukraine, which account for almost 30% of their wheat import needs.

A more pragmatic approach is recommended

The Tunisian economy is highly dependent on its external environment, whether for supply or for exports, due to a poorly integrated ecosystem.

Faced with this new world order, Tunisia should, according to the IACE note, rethink its relationship with its first trading partner, the European Union. It should also rethink relations with its close neighbours, particularly with Algeria and Libya, according to a more pragmatic approach both economically and politically.

The challenge for Tunisia is the reengineering of trade agreements in force with Europe, Algeria, China, the United States and Turkey with the aim of strengthening regional integration.

The Tunisian Central Bank (BCT) could consider including the ruble and the yuan in its basket of currencies, allowing Tunisian operators mainly in the tourism sector to accept payments in these two currencies.

“These funds will make it possible to pay for Tunisia’s purchases of raw materials from these two countries and will also facilitate the attraction of tourists from these two countries whose destinations abroad are increasingly limited.

Inclusive resilience

In Tunisia, the activation of multi-actor social dialogue and the establishment of the Higher Council for Social Development are assets for better inclusive resilience. Thus, thanks to the dynamism of its civil society, Tunisia could claim a better future.

Still according to the note from the IACE, the objectives in terms of sustainable development, environment and ecology will be controversial subjects. “While the move towards renewable energies consecrates them, the primacy of increasing agricultural production and food security may be to their detriment.

The governance of water resources and the use of arable land will certainly be reviewed to ensure better optimization and maximum use.

“Tunisia is among the first countries concerned by the optimization of these resources and the use of these unused agricultural lands for administrative and legal considerations”, specify the authors of the document.