Tunisia: Understanding Conflict 2012 - Johns Hopkins School of ...

The low levels of foreign direct investment are also a challenge facing the
country. The Eurozone crisis and the instability in Libya have had a harmful impact on
Tunisia’s levels of foreign direct investment, and indicate a need for Tunisia to diversify
its pool of investors. The Tunisian government could build a safety net by developing its
relationships with other countries. Tunisia has fairly new partnerships with China, India
and Turkey in trade and direct investment, and it could expand these partnerships. The
Arab Maghreb Union also has many potential consumers, but it has been inactive due to
political disagreements between Morocco and Algeria. The functioning of the Arab
Maghreb Union could also help to boost Tunisia’s economy and create jobs.
High Value-Added and Knowledge-Intensive Employment Opportunities
Tunisia is in need of high value-added and knowledge intensive employment
opportunities to meet the demands of the growing number of university graduates. Until
recently, Tunisia’s private sector employment opportunities have mainly been in low
value-added activities, such as in agriculture, textiles, and construction. This has made
Tunisia vulnerable, as it cannot compete with cheaper Asian competitors. However, due
to its highly educated population and its developed infrastructure and telecommunications
systems, Tunisia has the right profile to be able to develop a comparative advantage in
sectors that provide high value-added employment opportunities. Creating high valueadded
employment opportunities will be especially beneficial for lowering
unemployment among university graduates, who are currently employed primarily in the
public sector. Tunisia is already on its way to becoming a high technology country, as
evident in the presence of private companies that run call centers and provide support to
software companies in Italy and France.
Education System
Under the Ben Ali regime, education was compulsory until an individual reached 16
years of age, and a university education was virtually free. As a result, the number of
university graduates increased dramatically. University graduates have traditionally been
employed by the public sector; however, the public sector does not have the capacity to
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