Tunisia tries to boost local garment industry as it struggles with foreign imports

The Tunisian market has been flooded by smuggled goods of shoddy quality and safety standards.
Sunday 08/12/2019
‘Made in Tunisia’ first. Slim Feriani, Tunisian minister of Industry and Energy, speaks during an interview in Tunis.          (Reuters)
‘Made in Tunisia’ first. Slim Feriani, Tunisian minister of Industry and Energy, speaks during an interview in Tunis. (Reuters)

TUNIS - Given its worsening trade deficit, rising government expenditures and the devaluation of its currency, Tunisia is trying to seal cracks in its struggling economy by promoting local products internally and increasing exports.

The government introduced an initiative to revive Tunisian industries and sharpen their competitiveness in a local market flooded with foreign goods, especially from China and Turkey.

Tunisia implemented reforms to encourage local companies, with a particular focus on the textile, leather and footwear industries.

Tunisian Minister of Industry and Small and Medium Enterprises Slim Feriani said the textile and clothing industry is a strategic manufacturing sector in terms of exports, employment and value-added output.

Official data state that the sector includes about 1,604 production units, 1,320 of which are devoted to exports. Feriani said the sector recently underwent a recovery, which enabled it to record added value in domestic and foreign markets; 73% of companies in this sector export their total production.

A series of fashion shows featuring locally made garments from more than 150 exhibitors and titled “I Wear Made in Tunisia” is planned for the next few weeks. Seminars, workshops and partnership meetings between professionals are also scheduled. Exhibition space has been set up for local and foreign visitors.

The European market is Tunisia’s main traditional trade partner.

“The authorities are seeking to provide all the necessary conditions to support the textile and leather sector and to address outstanding problems such as

accumulated debts,” said Omar Bouzouada, director of the Agency for the Promotion of Industry and Innovation (API).

The sector is facing problems because of declining exports over the past nine years and local markets being flooded with foreign goods.

Tunisia has a record trade defi

cit with China and Turkey. Official data indicate that Tunisian goods in the domestic market do not exceed 20% of all products sold. Feriani said Tunisia

cannot stop importing goods but the government’s policy will be to boost local goods through consumer-awareness campaigns.

API has begun a promotional convoy that will tour the country to encourage citizens to buy Tunisian-made products

Local experts said they doubt that authorities will be able to address the trade deficit without fighting smuggling and illegal supply channels. In fact, the parallel market in Tunisia is doing much better than the regular formal economy.

Authorities say they will step up control of distribution channels, tariffs and taxation.

The Tunisian market has been flooded with smuggled goods of shoddy quality and safety standards but whose low prices are tremendously appealing to Tunisian consumers, given the relatively high prices of similar products in the formal economy. Tunisians have seen their purchasing power drop significantly in recent years.

The situation prompted authorities to direct efforts towards economic development by focusing on supporting domestic products to contribute to steadying the local currency and reducing the trade deficit although government efforts to tackle the trade imbalance through reforms have not yet achieved success.

The government is also seeking to modernise the leather and footwear industries through technologies updates using artificial intelligence.

Two automotive component manufacturing projects began operations in 2018 in Sfax and Sousse with Chinese investments. Beijing is taking advantage of signs of recovery of the business climate in Tunisia after signing an agreement within the context of China’s Belt and Road Initiative.