Strong Economy

The economy received a boost in July, with official figures showing strong growth, alongside a slowing inflation rate and an increase in foreign reserves.

According to information from the governmental National Statistics Institute (NSI), tunisia's Gross Domestic Product (GDP) in the first quarter of 2008 rose to approximately TD 6.2bn - up from TD 5.86bn the previous year - thanks largely to robust activity in the transport, telecom and industrial sectors. While this is slower than the 6.5% growth rate in the first quarter of 2007 - one of the highest in a decade - it still underlines the country's healthy performance against potential slowdowns in the US and European economies.

Tunisia has benefited heavily from its close ties with the EU, with exports making up to 45% of the country's GDP. Making the most of its recent free trade agreement with the EU, the country is looking to position itself as an industrial production base for the Mediterranean and North African region. Although tunisia faced added competition from Chinese producers following the end of import quotas, export-oriented textile firms in tunisia have grown by 12% year-on-year, with many European manufacturers drawn by cheap labour and close proximity.

The Republic of Tunisia (pop 10.1 million) is considered as one of the most stable countries in the Arab region. For the past decade it has been a shining example to other African and Middle Eastern nations on how to grow and prosper as a developing nation. In 2007, the World Economic Forum ranked the country as the number 1 most competitive African economy (29th in the world) with also the highest ranking out of all the countries in the Arab speaking world. Comparing other nations in the region, Morocco ranked 64th while Egypt came in 77th out of 131. In the same report, Italy was placed in 42nd position, 13 places below Tunisia. GDP per capita is around US$8,800.

The country has had to work extra hard to develop its industry and economy to the level it is at today. Unlike its larger neighbours, Libya and Algeria, Tunisia produces very little oil and so the country had to develop and excel its other industries such as tourism, manufacturing and agriculture. Needless to say that Tunisia's economic reform program has been lauded as a model example by international financial institutions.

Tunisia acceded to the GATT in 1990, is a founding member of WTO, and has an Association Agreement on free trade with the EU .