The Amilcar Notes (Part 3):

Tunisia's Forgotten Socio-Economic Crisis

By Rob Prince
Foreign Poicy in Focus
FPIF December 14, 2011

http://www.fpif.org/blog/the_amilcar_notes_part_3_tunisias_forgotten_socio-economic_crisis

1. ENI (L'Ecole Nationale d'Ingenieurs de Tunis)

The El Manar campus of the University of Tunis stands
high upon a hill far above the center of downtown
Belvedere. The campus is home to some 30,000 students,
among them many studying the sciences. ENIT - or
L'Ecole Nationale d'Ingenieurs de Tunis - is one of
Tunisia's most prestigious institutes, producing an
annual crop of about 1,000 engineers of all varieties.
The students who qualify to study there are among
Tunisia's brightest and most diligent.

I visited the campus the day a jobs fair was taking
place (December 7, 2011). At a time of high
unemployment with the Tunisian economy bleeding jobs at
an alarming rate, I asked about the job prospects for
ENIT's graduates. The response surprised me: virtually
100% of the engineers graduating from ENIT find
employment and usually immediately. Rare among
Tunisians these days, they will probably enjoy stable
and generally well-paid jobs their whole lives.

With its highly educated work force, led by graduates
of institutes like ENIT, Tunisia already possesses a
human capital, a solid intellectual and technical basis
for becoming the economic engine of the Magreb (North
Africa), being something much more than part of a
region which feeds Europe with raw materials, food and
provides tourist facilities for German and Nordic
tourists, and those from surrounding Arab countries.
From the point of view of political economy, the
question emerges: given the political changes and new
openness, can Tunisia re-invent itself economically,
building on the solid foundations that have already
been laid

Yes, Tunisia is in the midst of a powerful socio-
economic crisis, itself a part of the global crisis of
neo-liberal capitalism. But looking around the
Mediterranean, with the possible exception of France,
which is struggling with European integration, the
entire region is in dire straits. Tunisia's neighbors
are facing the same or worse crises. Algeria, Libya,
Egypt, Syria, Greece, Spain, Portugal - just to name a
few of the most obvious cases are all in many ways in
worse condition than Tunisia. Looked at from this point
of view, frankly, despite all its problems, ironically,
Tunisia probably has better  prospects of pulling out
of the crisis than many of the other countries in the
region.

2. The Stats

If the prospects for ENIT graduates are promising, this
is not the case for most other Tunisian youth
graduating from universities. The pickings are slim and
becoming slimmer with overall possibilities for
Tunisian economic growth in the foreseeable future not
promising. This is true throughout the Middle East and
is triggered by different factors, among them the
global economic slowdown and Tunisian heavy reliance on
European growth to fuel their exports and tourism.

The structure of the Tunisian economy itself,
essentially a periphery to a European core, adds to the
tension. On the one hand Tunisia is producing mostly
low and medium end products for a European market while
its university graduates, some of the region's finest,
are trained for more complex economic activities for
which there are no jobs in Tunisia, and so many of
Tunisia's best and brightest leave for the Gulf, for
Europe or North America. And they are the lucky ones
who were able to find work. This tension between a
highly educated work force and the likely job
possibilities is one of the key factors that triggered
the revolt, the case in point being Mohammed Bouazizi,
a young man with some university education, forced by
circumstance to set up an unlicensed fruit stand in a
town with high youth unemployment

Still, although the overall Tunisian economy is
expected to shrink by 3.3% this year with many alarming
corresponding indicators being produced daily in the
country's media, there are a few bright spots here and
there in the date that suggests limits to the free fall
and the keys to a possible recovery.

Despite the more somber statistics of anticipated
overall decline, according to Le Temps (12/7/2011) the
country's export sector is actually showing positive
growth signs. In 2011, a year of political turmoil for
the country, still exports grew for the first 11 months
by about 7.3%. Agricultural exports were in the lead,
jumping 39.8% from 2010; electrical product exports
grew by 22.9%. There were modest gains for textiles and
leather exports of 6.4%. Add to this the fact that
throughout the crisis so many Tunisians got up and got
to work, working factories often with managers,
ministries without ministers and given these
limitations, not missing their managers all that much.

Not bad for a country experiencing a full blown
political crisis that would have crippled many other
countries in similar situations far more.

On the other hand the phosphate sector - a critical one
- and its derivatives took a big hit, shrinking by 36%
and another mainstay of the Tunisian economy, tourism,
was badly hit as well. True, the 7.3% growth in exports
is quite modest compared to export growth in 2009,
2010, but still a hopeful sign. Imports shrank a bit
from 2010, the main imports being basic food stuffs and
energy. That Tunisia should need to import basic
foodstuffs - essentially grains - is ironic considering
that this country has been one of Europe's bread
baskets not for centuries but for millennia.

3.  The Implications

Of course it is easy to get lost in the figures. The
heart of the matter is that the Tunisian economy slowed
in 2011, export growth helped slow the decline some but
not enough to turn the economy around by a long shot or
to reverse the continued loss of jobs.

Given the continued political instability - admittedly
mild compared to what is going on in Syria, Egypt,
Yemen and Libya - and the unresolved crisis of the
euro, the prospects of any kind of economic jumpstart
or quick recovery appear almost out of the question.

The best that can be done is to keep the economy in a
holding pattern.

It is unlikely that even this modest goal can be
accomplished without activating the state's role in
creating jobs and social programs. Tunisia's economy in
fact is crying out for state intervention. Without
this, the social crisis threatens to deepen yet again
with almost predictable consequences. The fact is that
the Tunisian market by itself, for all its problems,
still one of the more vibrant ones in the region, is
incapable of generating enough growth to turn the
situation around. Tunisia indeed is a case study of
neo-liberal market oriented limitations.

Mohammed Bouazizi's death by fire a year ago should
have also marked the end of a certain kind of economic
development that had run its course. To continue on the
path Tunisia followed as a "model IMF student" is to
repeat the economic mistakes of the path and, frankly
to invite disaster. This is not so difficult to predict
- it was precisely in implementing this model - the
silence of any self-criticism of the IMF aside - that
contributed in large measure to the socio-economic
collapse in the first place.

4. No Discussion of the Failure of Neo-liberalism in
Tunisia

Certainly the ENIT graduates have a key role to play in
Tunisia's future and for them, the future looks good.
Yet for so many other Tunisians, working or unemployed,
the future looks grim at the moment. Tunisian's might
have won the freedom of expression for which they
dearly fought, but virtually no one from the political
parties or in the media are talking about the economic
roots of the crisis.

Triggering this crisis was massive unemployment, few
job opportunities for university graduates entering the
job market, the eroding overall standard of living of
everyone, wage suppression and political repression,
all of which are connected to the IMF/World Bank
sponsored neo-liberal economic model Tunisia embraced
almost immediately in full almost immediately after Ben
Ali came to power in 1987.

Yet, few people are talking about the death of Tunisian
neo-liberalism as if all the underlying tensions in the
economy didn't exist. Tunisia is still searching for
money from wherever it can get it and on whatever terms
it is offered. Wage suppression continues unabated as
do strikes all over the country. Given current wage
rates, the strikes and other job actions are not likely
to end soon. You'd think that Tunisia's economic
collapse came from workers seeking a living wage rather
than rapacious capitalists trying to steal everything
in sight.

While it certainly is true that one goal for which
Tunisians were fighting for overthrowing Ben Ali was
freedom of speech, workers - whose critical role in Ben
Ali's demise is hardly recognized - were fighting for
the right to organize and collectively bargain, for a
living wage which most of them do not have. Much
emphasis has been placed on Ben Ali's efforts to stymie
freedom of speech; very few people have noticed that a
fundamental goal in his repressive policies was to deny
wage increase requests "to keep workers in their place"
in order to keep Tunisian exports competitive.

5. Wage Suppression: at the Heart of Ben Ali's Neo-
liberalism

In fact wage suppression is at the very heart and soul
of Ben Ali's "new authoritarianism." Combined with
other classic structural adjustment takeaways like
cutting the subsidies on food and energy, under-funding
education and medical care, wage repression worked to
undermine the Tunisian standard of living considerably.
Yet during darker times, one rarely heard Tunisian
human rights activists or the Tunisian business
community complaining about wage repression.

One example of the lengths to which Ben Ali was willing
to go to suppress the call for jobs and wage increases
is, in 2008 in Redeyef, in the Gafsa mining region. It
took the government six months to crush the movement;
hundreds were arrested, many tortured, some died. When
it was over no relief of any kind came through from the
state. 2008 was a prelude to the events of last year.

Although slow on the uptake in the first days of the
national resistance after Bouazizi's passing, the labor
movement was there when it counted and was a key factor
in tipping the balance against the dictator. Twitter
and Facebook were useful to tools in the effort to kick
out Ben Ali. But it didn't hurt at all that two days
before he, wife and family left the country that
150,000 people called for his resignation in Sfax on
January 12, in a demonstration organized by the Union
General de Travailleurs Tunisiens (UGTT). It seems to
have been quickly forgotten that on the next day,
January 13, it was the UGTT that called for a
nationwide general strike for January 14. As a million
strong Tunisians marched on Tunis to demand their
rights and call for his resignation, Ben Ali thought it
the wiser to skedaddle off to Saudi Arabia with "the
Mrs."

6. The Rayon Bread Factory Sit-in in Jendouba

It should come as no surprise that as soon as Ben Ali
was overthrown and freedom of speech extended
generally, labor actions and strikes began almost
immediately and have continued until today. Virtually
every sector of the Tunisian economy has had major
strikes, sit-ins, and hunger strikes, from oil workers
in the south, to teachers nationwide. These strikes and
militant labor actions have gone on non-stop. Sit ins
for jobs have gone on almost non-stop in the Gafsa
region. On the Tunisian-Algerian border several hundred
people gathered to block the border crossing to protest
the job and social crisis. Such demonstrations are
being increasingly broken up by the military who more
and more find themselves breaking up strikes and
demonstrations

Yesterday's paper had a story about a sit-in at a bread
factory in Jendouba, in the northwest of the country.
It produces 80% of the country's bread.

Bread is a highly politically sensitive product in
Tunisia. In 1984, in response to IMF pressures to lift
bread subsidies, then President Habib Bourguiba ended
the subsidies causing the price of bread to double
overnight. What followed were called bread riots. They
were crushed by the Tunisian military. Immediately
thereafter, Bourguiba re-instated the subsidies. His
relations with the IMF deteriorated. There is some
speculation that one of the reasons that Bourguiba was
removed from power in 1986 was related to his poor IMF
relations. True, it is not proven, but almost
immediately after taking office, Zine Ben Ali re-
established relations with the IMF and World Bank and
began - quite enthusiastically to accept the structural
adjustment criteria for getting loans.

The Jenbouba sit-in at the bread factory was broken up
by the Tunisian army on the day that bread supplied to
local bakeries was about to run out. One sees in this
incident the role that the military is going to be
called on to play - to break strikes. It was a curious
sit-in as it was not the bakers in the factory who
organized it but sugar workers who shared the facility
with them and whose economic grievances had not been
addressed. The sugar workers rightly felt that by
blocking the bread factory it would draw attention to
their plight and it did so they blocked the entrances
and exits so that supplies could not enter and bread
shipments could not leave.

In the end, the newly formed Tunisian government can
deal with labor's demands only in a few ways: they can
improve the condition, acknowledging decades of wage
suppression and deteriorating social programs, or as in
Jendouba they can crush such movements, which seems to
be the chosen option. Despite the fact that low wages
were one of the main causes of the uprising, the
financial markets and much of Tunisia's business
community is set on keeping wage levels unchanged. Now
a few days short of the one year anniversary of
Mohammed Bouazizi's immolation, the socio-economic
crisis in Tunisia has hardly been addressed. This
cannot bode well for the future.

___________________

Rob Prince is a Lecturer of International Studies at
the University of Denver's Korbel School of
International Studies and publisher of the Colorado
Progressive Jewish News.

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