In an interview with African Manager, the director of the digital economy at the Ministry of Communication Technologies, Wissam Malki, reviewed the measures taken in Tunisia to promote the digital economy and technological innovation in Tunisia, particularly through the sector of innovative companies, known as startups or unicorns, when they manage to impose their product and brand at national and international level.
Interview:
In your capacity as Director of the Digital Economy at the Ministry of Communication Technologies, can you tell us what progress has been made in Tunisia in this area, particularly in the sector of innovative companies known as startups?
Tunisia has made a lot of progress in this field. It has been a pioneer in the African and Arab regions by passing the Startup Act in 2016, which organizes the work of startups in Tunisia. More than 20 African countries have adopted similar legislation, drawing heavily on the Tunisian model.
Indeed, the Startup Tunisia program, launched in 2019, has set its sights high from the start, making Tunisia a hub for startups with very high added value.
Over the past three years, from April 2019 to May 2023, this program has enabled 903 innovative Tunisian companies to receive the startup label, contributing to the creation of 4,500 quality jobs.
Some people link the success of innovative companies to international expansion. What do you think about this?
It is completely wrong to link the success of startups to their international expansion. However, the Tunisian law on start-ups encourages and promotes internationalization, setting up abroad and establishing partnerships with foreign companies. And yet, only about twenty Tunisian startups have tried their luck abroad and achieved resounding successes that are a credit to Tunisia. We must therefore constantly work to improve the investment opportunities and the socio-economic environment for startups in Tunisia, so that they can fully develop their capacities in their fields of activity, particularly in technological innovation, which is their main mission, but preferably in their home country, Tunisia.
The Startup Tunisia program has only achieved 40% of its objectives, which are to label 1,000 startups and create a total of 10,000 jobs by the end of 2024, compared to the 903 startups labeled and 4,500 jobs created to date.
The current monthly rate of startups being labeled is satisfactory. However, one of the objectives of the authorities is to create effective startups, “unicorn startups”, in parallel with achieving a turnover of one billion dinars, given what these innovative companies can do. Some of the world’s leading companies, such as Facebook and Google, were originally startups.
And what about the Fund of Funds created for this purpose and its contribution in this area?
The Fund of Funds, which is designed to finance startups, will initially allocate €200 million to this area.
The ANAVA Fund of Funds has been created to give the players in the innovative entrepreneurship ecosystem access to the financing they need to develop.
The Fund of Funds has a target size of €200 million and aims to invest in more than 13 investment funds dedicated to start-ups at each stage of their development (seed, early and late stage).
More generally, this fund of funds is part of the national program, Startup Tunisia, managed by Smart Capital and based on 3 main axes: The axis related to the Startup Act as a unique legal framework dedicated to startups created or established in Tunisia, Startup Invest as an investment framework dedicated to startups, built around a fund of funds with a target size of €200 million and supported by a GP incubator (management company) and a startup guarantee fund, and finally Startup Ecosystem as a support framework for ecosystem support organizations (ESOs) and startups.
All these details can be found on the official platforms dedicated to this area, and as a simple remark, the electronic platform for the registration of startups is working normally, apart from a few technical problems that occur from time to time.
The Startup Tunisie program is also part of the national strategy to encourage and promote the digital economy and technological innovation.
To this end, a number of benefits have been introduced, including the startup leave, which consists of granting a public servant or a manager of a private company with a permanent contract a year’s paid leave to create a startup. This is besides other benefits such as tax exemptions and the payment of social security contributions, as well as the status of approved customer at the Tunisian customs, which allows the start-up’s director to benefit from a number of customs facilities.
What about improving the business climate?
The government is currently working on the draft of the new Foreign Exchange Code and the draft revision of the 2016 Investment Incentives Law, which will give a new impetus to investment in general, particularly in the digital sector, technological innovation and high value-added sectors.
On the political front, the government has consistently shown its interest in the digital economy and startups. Earlier this week, Prime Minister Nejla Bouden received an elite group of Tunisian startup promoters who have stood out internationally and congratulated them on their achievements, which she described as true success stories capable of inspiring and positively guiding Tunisian youth.
