Tarek Zouari
Managing Partner at Exco Tunisie
Tarek Zouari is a seasoned chartered accountant with over 20 years of international experience in Finance and Audit, serving as the Regional Chair for Kreston’s Africa Steering Committee & Advisory Group. He is also the past President of Exco Africa, the first African network of independent accounting and auditing firms.
Tunisia: A beacon of opportunity in the Mediterranean
May 2, 2024
Tunisia’s evolving economic landscape offers a plethora of opportunities for businesses and investors, positioning itself as a beacon of resilience and innovation in the wake of the Arab Spring. Tarek Zouari, Managing Partner at Exco Tunisie discusses the country’s strategic geographical location, bridging Africa and Europe, along with its commitment to fostering a skilled workforce and a progressive economic environment, establishes Tunisia as an attractive destination for foreign investment and business expansion especially in agribusiness, aerospace, infrastructure, renewable energy (notably green hydrogen), and IT services.
Trade agreements and international relations
Tunisia has a wide array of multilateral and bilateral trade agreements with around 127 countries. Key trade agreements involving Tunisia include the African Continental Free Trade Area (AfCFTA), the Common Market for Eastern and Southern Africa (COMESA), the European Free Trade Association (EFTA), the Free Trade Agreement with EFTA States (Switzerland, Liechtenstein, Norway, and Iceland), the General Agreement on Tariffs and Trade (GAFTA), the Maghreb Arab Union Agreement, and the Agadir Agreement. Additionally, Tunisia has numerous bilateral trade agreements with various countries like the UK and Pakistan.
Highly skilled workforce
Tunisia has taken significant steps to nurture a talent pool, especially in science and technology sectors, through a focus on education and skill development initiatives since the 1960s. This has resulted in a highly skilled workforce, ranked 5th worldwide in terms of science and engineering graduates (Global Innovation Index, 2022), capable of meeting the demands of a rapidly evolving global market. The multilingual proficiency of its IT sector employees, in Arabic, French, and English, further positions Tunisia as an attractive hub for companies seeking a capable and dynamic labor force.
Sustainability initiatives
Tunisia has implemented a national strategy for the green economy. The areas of focus include organic farming, eco-tourism, sustainable transport and infrastructure, sustainable eco-buildings, green industries, ICT, energy efficiency and energy use, renewable water conservation and water reuse, and integrated waste treatment management. The Tunisian Budget Law for 2024 introduces measures aimed at promoting green finance and sustainable development, offering tax incentives for environmentally friendly projects in green, blue, and circular economies.
Support for startups and entrepreneurship
Implemented since 2018, the Startup Act is playing a key role in promoting innovation in Tunisia. Startups benefit from the exemption of income tax and social security contributions during the validity of the startup Label. Investors benefit from the exemption from capital gains tax. Entrepreneurs benefit from an allocation given to the cofounder and shareholder of a startup at launch to cover living expenses for one year.
Cost competitiveness
Tunisia stands out for its cost-effectiveness, particularly in terms of labor costs and the overall cost of living. The country boasts a cost of living that is 2.31 times lower than the global average, positioning it at 190th out of 197 countries in terms of affordability.
Recently, the National Institute of Statistics (INS) released its “Employment and Salaries” survey for 2022, shedding light on key insights. The survey reveals that the average basic salary in Tunisia for the year 2022 is 924 dinars, approximately 276€.
Moreover, Tunisia’s Investment Law of 2017 offers compelling incentives. For example, Projects of National Interest, defined as those with a minimum investment cost of fifty million Dinar (approximately 15M€) or those creating a minimum of 500 jobs within a 3-year period, are eligible for a range of benefits. These include deductions of benefits from the tax base over a 10-year period, an investment grant up to 1/3 of the project’s cost capped at 30 M TND, state subsidies for infrastructure development, and a 10-year exemption from employer contributions.
Outlook and strategic positioning
In summary, despite its relatively small local market size, Tunisia’s strategic location, skilled workforce, progressive economic climate, and commitment to sustainability and innovation collectively establish it as a gateway to Africa and Europe, offering abundant prospects for businesses aiming to expand their presence in Africa or for those looking to move closer to Europe.
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