Transacting in Africa – Exporting to Tunisia

With its 2011 Arab Spring involvement done and dusted, and the global recession lessening its grip on economies, Tunisia’s imports are once again on the rise. The economic forecast however is not for plain sailing; the country’s newly elected government faces immediate challenges in terms of stabilising the economy. It must reassure businesses and investors, bring budget and current account deficits under control, shore up the country’s financial system, bring down high unemployment, and reduce economic disparities.

The state of Tunisia’s import sector

According to the CIA World Factbook, in 2012 the merchandise and commercial imports of Tunisia totalled $23.32 billion. We expect this figure to reach $35.2 billion by 2015 and $40.8 billion by 2016. The country’s main import partners in 2012 were France (20.2%), Italy (16.9%), Germany (7.5%), China (6.1%), and Spain (5.4%). Its main import commodities were textiles, machinery and equipment, hydrocarbons, chemicals, fuel, and food.

Since the implementation of the IMF Adjustment Programme at the end of 1986, Tunisia has undertaken many reforms aimed at limiting the State’s intervention in economic activities in the domestic market. One of these reforms involved liberalising trade through the removal of import and export licenses, dismantling customs duties on imported goods in line with Tunisia’s international commitments (especially within the World Trade Organisation and the European Union – discussed below), and establishing bilateral and/or multilateral free-trade agreements with Arab countries such as Morocco, Egypt, Jordan, Libya and Algeria. However, imports of the most basic products such as cereals, sugar, oil, and steel have remained under the control of state-owned enterprises due to their socio-economic impact and to protect against inflation.

Free trade zones

Tunisia has two free trade zones, one in the north at Bizerte, and the other in the south at Zarzis. The land is state-owned, but the respective zones are managed by a private company. Companies established in the free trade zones, officially known as “Parcs d’Activités Economiques”, are exempt from most taxes and customs duties and benefit from special tax rates. Goods are allowed limited duty-free entry into Tunisia for transformation and re-export. Factories are considered bonded warehouses and have their own assigned customs personnel.

However, companies do not necessarily have to be located in one of the two designated free trade zones to operate with this type of business structure. In fact, the majority of offshore enterprises are situated in various parts of the country. Regulations are strict, and operators must comply with the Investment Code.

Tunisia and the European Union

In 1995 the European Union (EU) signed an Association Agreement with Tunisia (the first such agreement with a Mediterranean nation), and by 2008 the tariff and trade barrier dismantling undergone as part of the agreement achieved its goal: a Free Trade Area was established

Tunisia’s proximity and free trade with the EU means that European companies exporting goods and services there have access to a large market. The Tunisian population is currently around 11 million. Moreover, the country’s economy is fairly competitive by African standards thanks to good infrastructure, health and education.

If you would like more information or advice on exporting to Tunisia, please contact us at globalafricapractice@kpmg.co.za

 

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About KPMG Africa

The KPMG Africa blog is where we keep you globally connected by providing you with locally relevant content to create great conversation.

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