Germany and nearshoring: how Tunisia is losing its main investors to neighbouring economies

Germany, which had placed its bets on post-revolutionary Tunisia, and was one of the main investors in strengthening the country’s human capacities, is now redirecting its investments towards emerging economies such as Morocco.

Morocco is gradually becoming the main beneficiary of ‘nearshoring‘, which consists of relocating economic activities to regions close to those of origin.

Tunisia, which has been sinking steadily for the past two years, is seeing a decade go up in smoke due to a lack of visibility and predictability. An article in the monthly magazine Jeune Afrique refers to the “slow” to “fast exist” of foreign investors in Tunisia.

As political and economic uncertainties have increased in recent years, the country has seen foreign companies leave Tunisian soil and relocate to more stable economic powers.

Relocations lead to company closures and considerable job losses, as was the case for the employees of Latelec, a subsidiary of the aeronautical subcontractor Latécoère.

The lack of medium- and long-term visibility, particularly in terms of Tunisian regulations, is redirecting these subsidiaries and groups towards Morocco, which is more attractive at the time.

More and more French companies are admitting that they are finding it difficult to set up in Tunisia, whether in terms of agreements or administrative procedures. Far-reaching proposals, such as ambitious photovoltaic projects, get lost in the complexity of the Tunisian system, including the workings of the Tunisian electricity and gas company, STEG.

Entrepreneurs are afraid of being subjected to the same infernal mechanism as in European countries such as Greece and Spain before the 2008 crisis.

If Tunisia is able to enjoy moments of respite, it is mainly thanks to the funds granted by international backers such as the IMF. This is what is known as ‘untapped potential‘, despite the country’s know-how and considerable economic potential.

The associated image is a table from Credendo, a company that insures SMEs internationally, particularly trade from Belgium to Tunisia

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