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Since the 1970s, Tunisia has pursued a policy focused on export, and it continues to consider the manufacturing export-oriented services a high national priority. International trade has been essential to Tunisia’s economy, and its periods of accelerated growth have coincided with measures to open the economy to trade. In this context, the country liberalized its trade regime through unilateral tariff liberalization, reform of import procedures, and removal of many quantitative import restrictions. These trade facilitations have produced significant results, as illustrated by Tunisia’s 32nd ranking (out of 189 economies) in the trading across-borders, according to the World Bank’s Doing Business 2014 report.[1]   Must of Tunisia’s trade success is due to two factors:  regional integration and strong competition framework.

Regional Integration and Free Trade

Since 1990, upon acceding to the General Agreement on Tariffs and Trade (GATT), Tunisia has pursued an aggressive policy of regional integration through trade agreements.  Tunisia was the first Arab and Mediterranean country to sign in July 1995 an Association Agreement with the European Union (EU), which accounts for almost two-thirds of all Tunisia’s foreign trade. In 2012, Tunisia and the EU launched a new phase of their Privileged Partnership to extend the field of liberalization. The two parties signed a new Action Plan that delineates bilateral cooperation in various fields such as scientific research, social affairs, higher education, and financial assistance for 2013–17.

In addition to its Association Agreement with the EU, which is of the greatest importance for the country, Tunisia also has a Free Trade Agreement with the European Free Trade Association (EFTA), signed on December 17, 2004 as well as the Greater Arab Free Trade Agreement (GAFTA) and the Agadir Free Trade Agreement with Egypt, Jordan, and Morocco, which created a potential market of over 100 million people.

Healthy Competition Framework

Competition policy is governed in Tunisia by a 1991 law. The legal and institutional framework is solid and has been reinforced over the years. In this connection, three authorities are responsible for competition policy: the Department of Competition and Economic Investigation (DGCEE) of the Ministry of Trade, the Competition Board, and the Administrative Tribunal. The Tunisian authorities are seeking to develop and strengthen competition in the domestic market by reducing anticompetitive practices and unfair competition, particularly through giving total independence to the Competition Board.

Recent Trade Outcomes and Partners

Analysis of Tunisia’s trade balance shows a sharp widening in the trade deficit in 2012 amounting to TD 11,635 million compared to TD 8,604 million a year earlier and TD 6,408 million in 2009.  The rate of coverage consequently dropped by 5 percentage points to 69.5 percent. The rise in international prices, the devaluation of the dinar, the intensifying imports in the energy sector, and faster progress in demand mainly for imported consumer goods, caused the trade deficit to expand by 35 percent in 2012.

With regard to the geographical distribution of trade, European Union[2] (EU) represents nearly 70percent of Tunisia’s total exports in 2012.In particular, France, Italy, and Germany account alone for about 50%, 26%, 16,% and 9% respectively.  For imports, the EU is the main supplier of Tunisia with 62 percent. The major imports countries partners are France 20.2%, Italy 16.9%, Germany 7.5%, China 6.1%, Spain 5.4%