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HomeFeatured NewsTunisia: Pump-priming Plan. Who is eligible and who is not?

Tunisia: Pump-priming Plan. Who is eligible and who is not?

Following the adoption by the Cabinet meeting of the strategy devised to support economic enterprises experiencing a slowdown in their activities and to enhance competitiveness and back up economic activity, it may be relevant to shed additional light on the ins and outs of this plan and the timetable for its implementation.

According to our sources, this set of measures has been adopted as an anticipation of developments that will undoubtedly emerge in key sectors where Tunisia achieves the most of its market shares, namely textile and clothing, engineering industries and tourism. Part of those measures, a total of 16, will serve to avert the immediate impact of the international crisis; the 26 others will address the long term repercussions, which will undoubtedly occur as   economic turbulence accentuates.

In the hierarchy of sectors to be affected most from the crisis, the automotive components are first in line with the enormous difficulties facing the automotive industry in Tunisia’s traditional markets, France, Italy and to a lesser extent Germany, being noted that companies could decide on reductions in working hours, and this, and in all cases, according to labour legislation, which should lead to limited wage cuts ranging between 30 and 50%.

The involuntary redundancy period will be used to provide employees with training to enable them to develop their skills and know-how; this training will apply both to companies whose production goes to the domestic market and to those operating under the offshore regime

Regarding the six-month period set for the implementation of measures, it will be devoted to a real-time assessment of the situation as it will have to evolve, along  with companies, being up to the Government to support them beyond that period and in the light of developments in the situation at the international level and their specific impact on the Tunisian companies.
Regarding the eligibility of companies to financial measures decided by the Cabinet meeting, a committee was established at the Ministry of Industry  Energy and SMEs including all concerned  parties and whose task is to  guide businesses.
As for the financing of these measures, funds to be generated due oil prices drop will be used to support companies undergoing reduction of their activities in addition to a portion of the funds allotted under development for 2009.

The hope is great to see the Tunisian economy address cheaply current economic turbulence as it did in previous crises, particularly since September 11, namely soaring oil prices and higher agricultural products prices, so that the country is reaping 40% of its profits through its openness to the global economy. Since then, and in order to develop the competitiveness of Tunisian companies there will be reductions in export procedures’ cost amounting for now to 20% in order to bring it to 10 %.

Meanwhile, the focus will be on improving  Tunisia  product quality  through  fighting  informal trade and counterfeiting in addition to promoting  buoyant services , including those related to industry, logistics , transport., health, communications, financial sector, in short  high value-added services that have least experienced the crisis impact. Other actions to be carried out: improving the business climate, facilitating access to investment, simplification of administrative procedures, revising the legal framework governing business and enhancing social partners’ awareness of challenges to be faced amid the current crisis.

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