How to Improve Food Security in Tunisia: Step up Mutual Trade and Investment Links with the EU

Tunisia - 25 December 2022

Trade topics: Agricultural Trade, Foreign Direct Investment, Food security

Economic, financial, and social ties are strong between the European Union and its neighborhood. More resilient societies in the EU’s neighborhood would mean that they are liable to suffer less damage from regional conflicts and global crises – and this in turn has positive implications for European states. In our analysis, we therefore showcase how agricultural and agri-food industry interlinkages between Tunisia and the EU can help the North African state – now enduring domestic political stress and long-standing social and economic crises – improve its competitiveness and resilience against external disruptions. We find that lifting tariff rate quotas – or at least renegotiating the EU-Tunisia Association
Agreement of 1998 – could help Tunisia boost its agricultural and agri-food exports. Tunisia also needs to thoroughly reassess its production capabilities in these sectors on an empirical basis. We suggest that strategic decisions on finding the right balance between specializations in certain products with comparative advantages (e.g. olive oil) and vulnerabilities due to poor overall product diversification are vital. Those efforts should be accompanied by joint EU-Tunisian investments to foster the modernization of Tunisia’s agricultural sector with the goal of step-changes in sustainability (e.g. greater efficiency in water management systems).

Author(s): Houssem Eddine Chebbi and Markus Overdiek