Shift in Tunisia-EU relationship

Friday 27/11/2015
Prime Minister of Tunisia Habib Essid (R) and High Representative of the Union for Foreign Affairs and Security Policy Federica Mogherini, last July.

Tunis - In a shift towards a more “real­istic” vision of its neighbour­hood policy, the European Union is engaging Tunisia to forge a partnership designed to elevate the Maghreb country to just a few notches short of full membership status.
Negotiations began in October, three years after Brussels proposed a new relationship based on a Deep and Comprehensive Free Trade Agreement (DCFTA) between Tu­nisia and the European Union.
Tunisia’s strongest economic growth and relative social prosper­ity coincided with the implemen­tation of a trade association agree­ment with the European Union early in the 1990s. It is hoped the more ambitious DCFTA deal would jolt Tunisia’s agriculture and ser­vices sectors into higher levels of value-added output and enhance its global competitiveness.
Supporters of the deal argue that the new relationship could ease Tunisia’s daunting problems, especially high unemployment among university graduates and inequality between the relatively rich coastal edge and the hinter­lands where low-yield farming is the dominant activity.
“Tunisia believes economic in­tegration is an engine of economic growth and development,” said Ridha Ben Mosbah, the govern­ment’s top economic adviser and main Tunisian negotiator for the DCFTA. “Negotiations will bring about win-win solutions. We are counting on our European partners to reward Tunisia’s exceptional ef­forts. We are expecting special proposals from them.”
EU Ambassador to Tunisia Laura Baeza insisted that the European Union will not steamroll the deal on Tunisia, a country struggling with the uncertainties of demo­cratic transition, economic pres­sures and an expanding Islamic State (ISIS) in neighbouring Libya.
“We will decide together on the priorities. The approach will be incremental. It would be asym­metric and take into account the sensitivity of agriculture,” Baeza said. “The DCFTA could be given another name,” she added, in re­sponse to critics in Tunisia who accuse the European Union of neo-colonialism.
The stream of refugees has forced the European Union to re­think its European Neighbourhood Policy, initially launched in 2003. Security threats, including the horrific attacks by ISIS in Paris on November 13th, have caused Eu­ropeans to modify expectations of their southern neighbours, as past policies promoting unfettered free market access and liberal democ­racy have been unable to prevent the forces that are undermining stability and democratisation in its “neighbourhood”.
EU officials acknowledge that the earlier framework designed to engage and transform the bloc’s neighbours was flawed due to ar­rogance and naiveté.
“Our most pressing challenge is the stabilisation of our neigh­bourhood,” Johannes Hahn, the EU’s Commissioner for European Neighbourhood Policy and En­largement Negotiations, said in a release. “Conflicts, terrorism and radicalisation threaten us all. But poverty, corruption and poor gov­ernance are also sources of insecu­rity.”
An EU release explained: “Differ­entiation and greater mutual own­ership will be further key elements of the new European Neighbour­hood Policy (ENP), recognising that not all partners aspire to com­ply with EU rules and standards and reflecting the wishes of each country concerning the nature and scope of its partnership with the European Union.”
“We have to build together a safer environment, try to solve the many crises of our common region, support the development and the growth of the poorest ar­eas, and address the root causes of migration,” EU High Representa­tive Federica Mogherini said in the same release.
Tunisia seeks to benefit from the new EU policy during the next round of negotiations, scheduled for March 2016.
While some Tunisian experts want the European Union to wait for Tunisia to stabilise further, others favour speeding up nego­tiations, stressing that the country must reform its economy, includ­ing its underdeveloped farming sector, with or without a deal with the European Union.
“Worries about the unknown are the biggest obstacle ahead of the potential deal,” said Adel Messaou­di, an official of the farmers’ union UTAP, at a recent gathering at the Economic and Social Researches and Studies Centre in Tunis.
Tunisian advocates of the DCFTA emphasise the benefits of further trade liberalisation with the Euro­pean Union by underscoring the bright spots of the more than four decades of economic ties with the European bloc.
“The [earlier] trade agreement with the EU had broad and deep impact. Tunisia experienced a full change in its economic circum­stances between 1995 and 2010 in terms of rising income and con­sumption,” said Abdelaziz Halleb of Tunisian employers’ association UTICA.
Sceptics cited figures to display what they claim are Tunisia’s loss­es from pursuing close trade with the European Union.
“The economic growth induced by the free trade agreement with the EU since 1995 was not enough to absorb unemployment and ease development imbalances and gaps between regions,” said economic analyst Jannet Ben Abdallah.
She estimated that Tunisia had lost $9.2 billion-$11.7 billion in lost tariffs between 1996 and 2010. During that same period, the value of its currency shrank from $1.27 to $2.30 per dinar, and almost half of Tunisia’s manufacturing was erased by the sheer competition.

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