Driven by pressing needs, Tunisia and Libya bet on new partnership model
Tunisian and Libyan politicians have belatedly understood they are running out of time to save their countries’ emaciated economies.
The economic crisis affecting the daily lives of Tunisian and Libyan citizens compelled authorities of the two countries to adopt a strategic partnership model to emerge from the challenges they face and prevent further deterioration of living conditions.
The idea took shape with the creation of the Tunisian-Libyan Business Council, an economic forum set up in April in Tripoli to develop a plan to help the economies.
Within the framework of the partnership, Tunisians would not see Libya as merely a borderland that attracts labourers, absorbing the unemployment that has plagued Tunisia, especially since the 2011 collapse of the Qaddafi regime in Libya and the Ben Ali regime in Tunisia. In turn, Libyans would stop viewing their smaller neighbour as only a destination for tourism and medical treatment.
There are indications of a growing awareness to support bilateral business and trade and to strengthen the tourism sector. Within a few weeks, talks seem to have moved towards implementation of decisions.
The resumption of flights by Tunisia’s national carrier, Tunisair, to Libyan destinations would be key to boosting economic ties and tourism activities. The state-owned carrier suspended flights to Libya in 2014 because of escalating violence in the country.
Official Tunisian statistics indicate that before 2011, more than 1.5 million Libyans a year used to travel to Tunisia for tourism or medical treatment. Those numbers declined significantly in the past three years. Tunisians used to go to Libya in large numbers for work but that has stopped because of deteriorating security conditions.
Libya and Tunisia are also betting on other partnerships, ranging from expanding trade and developing the health sector to collaboration on major construction and infrastructure projects in Libya.
However, cooperation in the health sector will be deferred until bills owed by Libyan citizens are settled. The Libyan Presidential Council in June pledged to pay $77.8 million owed to Tunisian health-care institutions that has been outstanding for five years, estimates by the Tunisian Chamber of Private Clinics stated.
Libyan oil exports to Tunisia are at the heart of the new partnership. Libya is seeking to boost revenues by increasing oil exports and Tunisia has a huge energy deficit and might have to raise energy prices to shore up its finances.
Some Libyan-Tunisian trade is formal but a good part of it is transborder smuggling. Trafficking in all sorts of goods has been apparent along the Tunisian-Libyan border since the start of the unrest in Libya. Tunisia closed its trade crossing points with Libya in Ras Jedir and Dhehiba and both countries’ economies have suffered greatly as a result.
Official reports have shown that smuggling between Tunisia and Libya since 2011 has caused great damage to both economies. The Tunisian government is cracking down on smuggling activities with Libya but the Libyan side, represented by the internationally recognised government, still has a long way to go to show control of the situation.
Increased security restrictions after 2015 terrorist incidents in Tunisia made informal trade much more difficult.
The cooperation model that Tunisia and Libya are seeking is contingent on activating previous bilateral agreements. There are about 80 agreements that form the foundation for all new cooperation frameworks. The two countries have been pursuing the goal of complementary economies but are far from achieving it.