Tunisia’s leader vows to deliver on demands of revolution

Bloomberg

Tunisia’s prime minister said it’s time the government delivered on the long-ignored demands of protesters whose 2010 revolt swept an autocratic ruler from office and sparked the Arab Spring.
Unemployment, pay and inequality were the main drivers of the Jasmine Revolution, and six years later unrest is again festering after previous administrations focused on cementing the nation’s transition to democracy. Those efforts were rewarded with successful elections, a new constitution and a smooth transfer of power between radicals and secular parties. But the economy stalled after major terrorist attacks decimated the key tourist industry and strikes at phosphate mines and energy plants.
Tunisia is ready for the next step, Prime Minister Youssef El-Shahed said in an interview late on Tuesday at the Palais de Congres in Tunis, where Gulf and European countries convened to pledge billions of dollars of aid and investment.
“It’s time now to move to the economic and social side to respond to the demands of the Tunisian revolution and support the democratic process,” he said, warning it won’t be easy. “We must carry out deep reforms in the budget, banking sector, taxes and many other areas,” he said. “We started reforms and these reforms have a cost but it is our duty to create fortune and inclusive growth.”
The government called the Tunis conference to secure investment for a variety of projects — including roads, airport expansion plans and new water plants valued at 17.7 billion euros — as well as additi-
onal funding from donor governments and international institutions. Gulf Arab states, France and international institutions responded with pledges of billions of dollars for aid and investment.
The stakes are high as an unraveling state would pose risks not just
for Tunisia’s population of about 11 million. Tunisians could join the exodus of poor North African migrants seeking to reach Europe, and growing despair might enable Islamist extremism to prosper.
Officials have laid out a development plan through 2020 that calls for boosting private-sector investment, creating more than 400,000 jobs and enacting structural reforms — economists’ code for cutting spending.
Shahed faces many of the same problem as his predecessors, including powerful unions and political instability. And he’s already meeting resistance. The nation’s biggest trade union, which in 2015 shared a Nobel peace prize for its efforts in stabilizing the country’s transition to democracy, has called for a general strike on Dec. 8 if the government moves ahead with a plan to freeze wages.
“We have invested a lot in creating our democracy but the cost was high on the economic level,” said Moez Joudi, an economic analyst and head of the Tunisian Association for Good Governance. “Politicians cared a lot about political conflicts and forgot about the economy.”
The government finds itself “between the hammer and the anvil,” Joudi said. “The IMF on one side is more strict and doesn’t want to give money that would be spent on items that deepen economic problems, and labor unions on the other.”
The government wants to target corruption and raise tax revenue next year to lift economic growth
toward its potential of 5 percent annually, from about 1.5 percent currently, Shahed said. Public-sector companies will have to be streamlined and the black economy challenged, he said.
Mouayed Makhlouf, a regional head of the International Finance Corp., said the lender has invested $300 million in Tunisia but could
inject a similar sum each year if
reforms favoring private-sector growth continue.
Tunisia has already secured a $2.88 billion International Monetary Fund loan, and hopes the investment conference that ends on Wednesday “will put it back on the international investment map,” the prime minister said. The government plans to get about 6 billion Tunisian dinars ($2.6 billion) through foreign loans next year to help bridge the financing gap, he said. In the meantime, Tunisians want what they called for six years ago.
“The street is very tense,” said Sami Tahri, assistant secretary-general of the General Union of Tunisian Workers, which called for the Dec. 8 strike action. “There is a fire burning under the ashes.” There can be “no compromise,” he said.