Has the drought of the last four years been nothing more than a scapegoat for all the problems that have plagued Tunisia’s prestigious agricultural sector?
This is the view of many who are waiting to see what will happen this year after the recent favorable rains.
For many ancient peoples, the test of water was infallible in revealing lies.
Recent figures from the Agricultural Investment Promotion Agency (APIA) show that agricultural investors have been remarkably cautious in recent times.
According to APIA, in the first eleven months of 2023, approved agricultural investment fell by 29.5% to TND 383.5 million compared to the same period in 2022.
Approved private agricultural investments decreased by 21% compared to the 2016-2020 development plan.
They break down as follows: TND 244.5 million for agriculture, TND 60.3 million for agricultural services, TND 44.4 million for fisheries, TND 31.3 million for primary processing and TND 3 million for aquaculture.
Seven investment projects with foreign participation were approved for a value of TND 12.5 million, compared with three projects for a value of TND 4.6 million during the same period in 2002. Investments approved for young people amounted to TND 42.1 million compared to TND 55.8 million in 2022. Investments in favor of women amounted to TND 28.3 million compared to TND 25.9 million in 2022.
Climate risks are an undeniable fact. However, farmers, analysts and heads of agricultural supervisory bodies, including UTAP and the National Farmers’ Union, have repeatedly denounced the more serious effects of the business climate, combined with the carelessness that characterized government action at all levels during what is now known as the “black decade”.
For example, Government Decree No. 2605 of December 29, 2015 exempted the import of fodder from customs duties, while subjecting the sale of fodder to VAT at a rate of 19%, in other words favoring importers to the detriment of farmers, since VAT is a consumption tax borne by consumers and, in this case, farmers.
Priorities not respected
Has the situation improved? The question is worth asking, judging by the assessments of farmers and farm managers.
Speaking to a local radio station on Tuesday December 19, at the height of the good rains in the country, Mohamed Réjaibia, the UTAP board member in charge of grain, revealed that only 10% of requests for agricultural loans had been met, while access to agricultural inputs was still difficult. However, Tunisia produces some of these inputs, and there is a public bank specifically dedicated to supporting the agricultural sector and farmers.
Articles 20 and 21 of the 2024 Finance Law include measures to support farmers and grain producers in particular.
The latter article, notably, repeals the provisions of the aforementioned Government Decree of 2015 regarding the application of VAT to animal feed, while Article 20, which in principle aims to facilitate farmers’ access to bank financing, is good but insufficient to meet the needs in this area, which are also recognized in the explanatory memorandum to the said article.
On the other hand, the same Finance Act sought to improve the means of intervention of the Fund for the Promotion of Packaged Olive Oil and the income of the Fund for the Financing of the Organic Break in the Fishing Sector. That’s all very well, some analysts have said, but in the current Tunisian context, are these options so urgent and such a priority compared to the priorities and urgencies of the grain and livestock sectors?
The shortages of flour, milk and butter tend to favor the latter two sectors.
