Interview: Samir Majoul
What measures can the central bank take to help boost private investment in domestic companies?
SAMIR MAJOUL: The Central Bank of Tunisia (Banque Centrale de Tunisie, BCT) should seek to implement a monetary policy that guarantees controlled inflation, an investment-friendly interest rate, currency stability and an effective currency exchange framework. We have held regular meetings with the BCT to find the best ways to achieve these objectives. Coordinating the BCT’s monetary policy with fiscal, energy and industrial strategies will also strengthen its ability to implement successful changes. In addition, collaboration between the financial sector, the insurance sector and financial technology companies will help to improve companies’ access to credit, bank liquidity and insurance mechanisms, which will streamline the flow of transactions.
How can the fiscal framework be modernised to encourage more foreign investment?
MAJOUL: Investors are particularly responsive to the transparency and attractiveness of a country’s tax system. Offering an advantageous tax rate, value-added tax exemption and a single account mechanism is likely to attract investors. However, it is important to consider that tax revenue is essential for the functioning of the state. Therefore, facilitating access to the formal economy – via a unique identifier, for example – will allow enterprises to integrate into the formal economy and increase the taxpayer base. A moratorium guaranteeing Tunisia’s fiscal stability would then encourage more investment through enhanced visibility.
In what ways can private sector firms transition to higher value-added activities?
MAJOUL: According to the Atlas of Economic Complexity developed by Harvard University, Tunisia is ranked first in MENA in terms of know-how, referring to a country’s productive capacity. This places us in the same position as some European economies. We hope to transition to a higher value-added economy by developing this competitive advantage and strengthening our existing know-how. To this end, private firms are working to forge connections to different industries, as well as create links with universities, technology parks, vocational training centres and research institutions.
International trade is also a driving force of this transition. As demand continues to grow and the number of foreign customers increases, our economy is able to reap the benefits. For this reason, an economic diplomacy agreement has been signed with the Ministry of Foreign Affairs to encourage further engagement with global markets. Moreover, the Tunisian diaspora has a large role to play in strengthening the country’s ties with the rest of the world by connecting international firms to the local network of subcontractors, and targeting and attracting high-value foreign investments.
Which sectors are most important to the readjustment of the trade balance?
MAJOUL: The energy sector has an important role to play in stabilising Tunisia’s trade balance. The new incentive framework to reduce the energy deficit by encouraging the use of renewables is a promising development. The rollout of solar power plants across the country has also accelerated, which is a significant step in the right direction.
In addition, the most important sectors for the national export economy are supported by tripartite agreements, which aim to develop national and international competitiveness. These key sectors are: automotive manufacturing, olive oil, textiles and pharmaceuticals. The plan sets out quantified medium-term objectives for these industries, in order to boost exports and domestic production.
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