The goals, operation and mission of the Generational Fund were the focal points of an international conference held on Wednesday in Gammarth by the Finance Ministry and the Forum for a New Republic (Nou-R), around the theme of: “Prosperity for Consolidation and Democracy.”
This investment fund is a new solution advocated by the Jasmine Plan for the period 2012-2016 to boost investment in Tunisia and consequently create jobs and wealth with an initial budget of nearly 2.5 billion dinars.
It aims to contribute to funding large-scale projects with a predefined strategy seeking to transfer the State’s participation to private promoters.
The generational fund will be structured as a Fund of funds.
Indeed, several sub-funds will be set up by this new catalyst for investment, including the private equity fund and specific sectoral funds (infrastructure, agriculture, tourism, real estate…).
It seeks to raise own funds equal to 4 billion dollars in the two years that follow its creation, expected in the second quarter of 2012, said Finance Minister Jaloul Ayed.
The Minister added that this fund could generate overall investments of 30 billion dollars in the next five years, thanks to combined leverage and multiplier effects.
These investments, he said, will contribute to the creation of over one million direct and indirect jobs.
The Minister added that the Government, which is the major sponsor of this Fund, will play a key role in the governance of this mechanism, but will give necessary latitude to private investors.
The generational fund, said the Minister, will seek to raise necessary funds for these projects, thus allowing the State to avoid resorting to additional debt, adding, in this regard, that Tunisia’s debt ratio is now at 42%, against an average of 80% in Europe.
Several conditions should be met to reach the objectives assigned to this fund, said the Minister.
These include creating a capital market designed to fund small and medium enterprises (SMEs) and small and medium industries (SMIs) which account for 86% of the Tunisian industrial fabric, bringing needed reforms in the tax and administrative areas and revising the investment code.
The Minister also stressed the challenge of identifying investment projects abroad through targeted marketing operations and mobilizing competent and specialized teams in private equity to identify new investment opportunities.