The latest statistical indicators published by the Ministry of Trade earlier this week revealed that Tunisia’s exports increased by 20.5%, almost as much as imports which rose by 22.2%, leading to a 27.1% increase in the trade deficit.
In sum, the trade balance deficit has continued to widen since 2010. It grew from 8.3 billion dinars in 2010 to 19.41 billion dinars in 2019 (up 11.1 billion dinars), and the coverage rate decreased by 4.6 points (from 73.9% in 2010 to 69.3% in 2019).
Unfair agreements
This is naturally due to the high volume of imports compared to exports for several reasons, the most important of which is the depreciation of the dinar and the rise in international prices, especially fuel prices.
An eminently aggravating circumstance is that many agreements previously signed by Tunisia grant multiple privileges to other countries without any significant dividends; in short, unfair agreements that must be revised, such as the trade agreement with Turkey.
Moreover, Tunisia has started to study the revision of the free trade agreement with Turkey, following the deterioration of its economy, in order to protect local production.
According to official statistical indicators, the trade deficit with Turkey has worsened, especially since 2007. In fact, it has increased more than 5 times until 2020, rising from -409.2 MD in 2007 to -2140 MD in 2020.
This has resulted in a significant decline in the rate of coverage of imports by exports, reaching a low of about 13.8% in 2019 due to an expansion of the deficit by 2466.8 MD, which is considered the deficit’s maximum value recorded since the entry into force of the partnership agreement.
Proposals to stimulate exports
Faced with this situation, the Ministry of Trade proposes to adopt another approach that it considers consistent. It provides for rationalizing imports of Turkish origin and enhancing Tunisia’s exports, as well as emphasizing the need to take advantage of all opportunities for economic and technical cooperation that can advance the national economy at the level of exports, increasing their volume and improving and facilitating access to the Turkish market, as well as broadening the base of exported products.
Regarding imports, a note from the ministry points out that through the 2018 finance law, Article 17 of the partnership agreement with Turkey has been activated, which increases the customs duties imposed on products included in Annex 2 of the agreement. However, the products listed in Annex 2 of the agreement do not exceed imports which represent 20% of Tunisia’s overall imports of Turkish manufactured goods.
In this context, it is suggested that consultations be held with the Turkish side to review the lists of products concerned.
The scam of Turkish certificate of origin
The note from the Ministry of Trade mentions irregularities and violations of international trade rules affecting the import of certain products from Turkey, such as certain Chinese products that have obtained the Turkish certificate of origin and are exported to Tunisia with preferential prices under the agreement. There is also the import of counterfeit products of Tunisian brands manufactured in Turkey and promoted on the Libyan market where they are falsely presented as Tunisian products.
It should be noted that the free trade zone between Tunisia and Turkey was established under the partnership agreement signed in Tunisia on November 21, 2004, which came into force on July 1, 2005.
This agreement allows for the total exemption of all industrial products from customs duties, and also provides for the exemption of certain agricultural products from these duties up to a certain ceiling, as it is the case with dates exported up to a limit of 5,000 tons.
