Costly squabbles: The solution to Tunisia’s economic problems lies in political consensus

This is a cross-post of a piece written by Niveen Wahish (ERF Communications Officer) On the second day of the ERF workshop on "The political economy of transformation in the ERF region", a policy seminar was held to discuss the performance of the Tunisian economy in light of the ongoing political transformations. The following post is a reflection on the different presentations and interventions tackling Tunisia's structural reforms in the aftermath of the Arab spring, as well as the eternal link between the lack of political consensus and economic problems. As stated by Mustapha Nabli, Former Governor of the Central Bank of Tunisia; political landscape and coalitions can be double-edged as they can constrain policies and reforms, or open opportunities for new reforms. [caption id="" align="aligncenter" width="500"]Mustapha Nabli & Sonia Naccache Mustapha Nabli & Sonia Naccache[/caption] In three years of transition, the Tunisian economy has suffered tremendously, mainly because of the political situation. This message was at the heart of a policy seminar, organized by the Economic Research Forum (ERF), on “The Performance of the Tunisian economy in light of the ongoing political transformations”. According to Moez Labidi (University of Monastir), Tunisia’s growth rate has dropped to around 2.5-3 per cent in 2013 compared to 5.6 per cent in 2010. In his presentation titled “Tunisia’s Macroeconomics; waiting for political stability and structural reforms,” Labidi listed the number of problems faced by the Tunisian economy during the transition and since the revolution in early 2011. Sonia Naccache (University of Tunis) reiterated a similar view. During her presentation on “Structural reforms in Tunisia: an agenda in waiting”, Nakkash described how the political squabbling affected the decision making process in Tunisia. She lamented that in the three years that followed the uprising, Tunisia has had two transitions: the first was from January 2011 to October 2011; the second began in October 2011 to-date. There have been five governments during the two periods. Yet, none of these have managed to come up with a vision for what needs to be done in Tunisia, according to Sonia. The same trend continues today, with the leading party focusing on power control instead of reforms. Read more of this post Watch our interview with Mustapha Nabli, Former Governor of the Central Bank of Tunisia
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