The Finance Act for 2022 provides for financing needs of 19,983 MD including 12,652 MD from international borrowing. The Tunisian authorities are betting on an agreement with the International Monetary Fund (IMF) to unblock the situation.
According to the Minister of Finance, the agreement in question will not cover this entire sum, but will encourage Tunisia’s partners to enter into bilateral negotiations. The government has thus prepared a document on which it will base its discussions with the IMF. It contains a program full of inconsistencies, even more catastrophic than LF 2022, and which we have boldly given the slogan “Commitment, Coherence, Credibility”.
The program of a government in favor of transparency that no one could have known about without leaking the document. This is, of course, part of the exclusion policy that the government had launched during the development of FL 2022. This document does not mention the participation of the social partners or the debate on a strategy defining Tunisia’s future. It is about fifty pages developed by the services of the Ministry of Finance and Economy and Planning, the Central Bank of Tunisia and the Presidency of the Government. The pinnacle of irony, the document in question emphasizes the importance of better transparency and a strengthening of the governance of reforms!
The document sinks even more into ridicule and evokes the improvement of the business climate and the renewed confidence among investors, while the president does not spare the effort to call them names: traitors, thieves, crooks … Kaïs Saïed even went so far as to assimilate them to the free fox in the free hen house, who benefits from a system based on the law of the strongest and facilitates the spoilage of property and wealth.
But still, how to build trust between the investor and the state when businessmen and decision makers have been detained and abused by the government and there are plenty of examples on this topic. Samir Taïeb, former Minister of Agriculture, was arrested on October 26, 2021 on suspicion of corruption based on a file that did not contain evidence to be released on December 1, 2021. Businessman Mehdi Ben Gharbia was, as far as he was concerned, the subject of a campaign of smearing and encouragement. He was arrested on October 17, 2021 after an interrogation that lasted more than ten hours. On December 14, 2021, the investigating judge decided to release him, and then the public prosecutor appealed the decision.
Assuming the government manages to convince the IMF of its good intentions, then how does it intend to explain the total breach between LF 2022 and this program? The document evokes a revival of the ICT and automotive sectors through the improvement of the value proposition in the automotive sector. However, none of this was mentioned in LF 2022! The government has contented itself with proposing a few measures regarding vehicles imported or acquired locally by Tunisians living abroad and has opted for a policy with deaf ears towards companies.
As for the ICT sector, the approach was even more surprising! LF 2022 dedicated an upward adjustment of several taxes. This prompted the National Digital Federation under Utica to express its astonishment and indignation at the attitude of the Tunisian authorities towards this sector. The provisions of this law would threaten 10,000 jobs.
Still in the context of this pause, the Tunisian Government’s proposal refers to the abolition of the second wave of permits, without this being mentioned in LF 2022.
As we say “The show must go on!” and therefore the program speaks of green economy (an almost absent element of LF 2022). The government will present several measures to the IMF on this issue, whereas it contented itself with introducing a small reduction in the tax level on imports of solar panels and hybrid and electric cars. The government has therefore chosen to abolish the customs duty on imports of electric cars without starting a project to install charging stations.
On the other hand, the government at the level of the reform program is talking about (hold on tight!):
– Relaunch and operationalization of the Tunisian solar plan
– Sectoral and national strategies for ecological change
– A regulatory framework that encourages electric mobility
– Generalization of sorting with hotels, industries, public and educational institutions
Promote the implementation of solid waste management projects in the framework of PPPs
Implementation of the objectives of the Nationally Contributed Contribution (NDC) for the waste sector
– Announcement of the new five-year RE production program from the private sector for 2022-2026
Encouragement for the implementation of renewable energy for own production (social solar cell, industry, public buildings, etc.)
All of these elements clearly represent a desperate attempt to sell dreams and beg while having a hint of sincerity. These are just slogans without clear and measurable goals. Phrases that we will have to stick to every speech and every campaign. A process reminiscent of the fine speeches of the various powers in place on the subject of digitization and digital technology.
At this level, the government has not failed in its task! He believed that digitalisation represented one of the leverages of this reform program. While advocating for transparency and dialogue, the Tunisian authorities intend to replace the telecommunications code with a new text called the digital code. This will be proposed to the IMF without raising the issue at the national level and without debate. In addition, the adoption of a legislative text regulating several sectors and sensitive elements will take place without going through a representative and legislative assembly. Making such decisions unilaterally will damage unity and further accentuate the gap that continues to widen between power on the ground and the rest of the components of Tunisian society.
As for the citizen’s digital identifier, the government has not addressed the issue in LF 2022, while the agenda of the program indicates that this decision will see the light of day during this year.
The fallacy of this “magnificent” program does not stop there! The government has decided to invest in very high speed infrastructure. According to the same source, this will make it possible in 2023 to generalize access to optical fiber to pave the way for the introduction of 5G. The establishment of a fiber optic network within the framework of major reforms in a country with an area of less than 170,000 km² will thus require two years of work carried out by the state. Why does Tunisia intend to do this? What will be the role of the private sector in all this? In order to remedy the delay in this case, the present power should consider delegating this project to private economic structures established in Tunisia with the technical and human resources capable of carrying out this type of task quickly, in order to be able to commence subsequently. the introduction of 5G technology, which, for example, has been used by our French neighbors since 2020.
Another surprising element cited in this document: the National Anti-Corruption Authority (Inlcc). Without explaining to us by what logic or mechanism, the government intends to present Inlcc as being one of the levers of this reform program that enables growth and justice to be achieved! A great mystery, especially since the police forces had evacuated and closed the body since August 20, 2021. In addition, the President of the Republic has decided to dismiss his interim President, Anouar Ben Hassen, on August 20, 2021. The reform program does not specify the date of resumption of the body.
Another proposed tax measure is an increase in tobacco prices to reduce the budget deficit. Aside from the fact that over-taxation and rising tobacco prices will promote the black market and the flow of smuggled goods, a simple Google search helps to understand the IMF’s policy on such measures. The increase in taxes and prices on harmful products such as tobacco is part of the improvement of the health system and not a simple reduction of the budget deficit. The IMF, the World Bank, the OECD and other financial institutions have called on states to introduce a tax that provides access to better health and medical services to treat tobacco addiction or prevent smoking. The IMF has explicitly insisted on this approach since the first wave of the Coronavirus pandemic. The use of the rise in tobacco prices to reduce the budget deficit shows that the government is simply trying to fill the deficit in some way and not to lay out a plan to stabilize public finances. “The management did what it could! All this is within the bounds of what is possible!”, We will be told.
Finally, and to put an end to this spectacle in bad taste, the government will oblige the IMF to apply this program within the framework of a plan for the period 2022-2025. An interim government, formed as part of the Communication on Extraordinary Measures, responsible for governing before the December 2022 legislative elections, will commit to implementing the reforms by 2025, an obligation therefore for an entity that: may no longer exist until next year! Meanwhile, the government and the president of the republic have succeeded in isolating themselves and alienating the vast majority of actors on the political scene and in civil society. The terms that come to mind are: breaches between the government and the social partners, isolation of the president and lack of national harmony. The next parliamentary elections will disrupt the political spectrum and will certainly lead to the creation of a political government which will adopt its own program of reforms and economic recovery. Najla Bouden’s team’s proposal does not bind the political parties, as they have not even been informed.
Regardless of the abominable aesthetic aspect of the document and its pompous slogans, this enigmatic and incoherent program reflects the policies of the current government itself and the speeches of the Head of State that offend the intelligence of the citizens. Najla Bouden’s team believes that they can reassure the IMF with this program and claims to be able to get a loan to finance part of the state budget. It is in this sense that the budget had also been developed. A lame assumption that leads us even further into the unknown and total blurring.