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Tunisia: trade deficit falls sharply

The results of Tunisia’s foreign trade at current prices in January 2020, show that exports fell by 4.2% against +21.9% during the month of January 2019 and the trade deficit was almost halved.

Foreign sales reached 3,655.6 MD against 3,815.5 MD in January 2019. Similarly, imports recorded a 14.1% decrease against +24.1% in January 2019.

In value, imports reached the amount of 4626.1 MD against 5383.8 MD in January 2019.

Following this change in exports (-4.2%) and imports (-14.1%), the trade deficit is reduced to the level of 970.5 MD against 1,568.3 MD in January 2019.

The coverage rate gained 8.1 points compared to January 2019 to settle at the respective rates of 79% and 70.9%.

The trade balance is in deficit of 970.5 MD following the deficit recorded with some countries such as China (-506.3 MD), Turkey (-194.7 MD), Algeria (-158.2 MD) and Russia (-63.1 MD).

On the other hand, the trade balance recorded a surplus with other countries, mainly France (362.9 MD), Italy (36.5 MD), Libya (78.2 MD) and Morocco (31.2 MD).

Offshore exports less! Why?

The distribution of trade by regime shows that exports under the offshore regime recorded a 4.5% drop against +23.1% during January 2019.

Imports under this regime saw a decrease of 7.2% against +12.9% during the same period in 2019. That finding should, in principle, call on the Tunisian authorities to know the cause and provide a solution as soon as possible.

The decrease observed in exports (-4.2%) during the month of January 2019 concerns the majority of sectors.

Indeed, the energy sector posted a decline of (-12.6%), the manufacturing industries sector (-12.7%), the textile and clothing and leather sector (-6.1%) and the mechanical and electrical industries sector (-3%).

On the other hand, the agriculture and food-processing industries sector recorded a +7.5% rise, resulting from higher olive oil sales (158.8 MD against 145.5 MD) and the mining, phosphates and derivatives sector by +0.4%.

Tunisia’s exports to the European Union (73.4% of total exports) decreased by 4.3%. This evolution is explained, on the one hand, by the decrease of the country’s exports to some European partners, such as France by 9.9% and Germany by 14.8% and, on the other hand, by the rise in sales to other countries, especially Italy by 2.7% and Spain by 13.1%.

With the Arab countries, exports grew with Algeria by 14.8%. On the other hand, exports decreased with Libya by 18% and with Morocco by 17.1%.

Bad decreases in imports

The 14.1% decrease in imports is mainly due to the decrease in imports of capital goods (-24.8%), basic agricultural and food products (-22.5%), raw materials and semi-finished products (-8.8%), and energy (-8.9%) resulting from lower purchases of refined products (334.3 MD versus 493.2 MD). On the other hand, mines, phosphates and derivatives went up 2.6%.

It should be noted that the drop in capital goods, as well as that of raw materials, are not a good sign for a possible economic recovery.

Such declines are generally an indication of lower investments in the future, or an expected drop in production, or at least its stagnation in the case of stocks already made of capital goods and raw materials.

Unless it is a question of the disposal of stocks in anticipation of the exchange rate, and before this anticipation disappears with the consolidation of the Tunisian Dinar.

As for imports, trade in goods with the European Union (49.7% of total imports) recorded a 15.7% drop to 2,301.1 MD. Imports went down by 20.3% with France and by 13.5% with Italy.

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