Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

Fragile Gains

Published 04/08/2014, 06:37 AM
Updated 03/09/2019, 08:30 AM

The beginning of the year was marked by two major events: the vote on the new constitution and the formation of a technocratic government. Although the route to elections finally seems to be opening up, they are unlikely to come until the second half of 2014. In the meantime, the transitional government faces some major challenges, particularly on the social front, against a background of weak growth and limited financing room for manoeuvre. In such difficult conditions, the country is likely to receive strong support from the international community, unless the commitments made on reforms are not fulfilled.

Political prospects start to improve
Three years after the collapse of the government of President Ben Ali, the political transition took a major step forward on 26 January 2014, with the ratification by the National Constituent Assembly (NCA) of the new constitution. Soon afterwards, the new Prime Minister, Mehdi Jomaa, formed his technocratic government. The previous coalition, dominated by the Islamist Ennahda Movement, had agreed to leave office some six weeks earlier in a bid to end the crisis that had paralysed the country since the assassination of MP Mohammed Brahmi on July 2013.

Tunisia has thus adopted a constitution which the international community has unanimously praised for its modernity. More importantly, this stage marks the desire for consensus between various players on the political scene and in civil society, despite the climate being scarred by considerable mistrust between Islamists and their opponents. In this, Tunisia sets itself apart from the other countries in the region affected by the “Arab spring”. Holding legislative and presidential elections will represent the final stage of political transition. No calendar has been set so far, but it is highly likely that elections will be held in the second half of this year, raising hopes that the creation of stable institutions will produce a significant improvement in the political situation.

In the meantime, the new government faces immense challenges, particularly on the social front, whilst the economy is struggling to recover and the security situation has deteriorated significantly. On top of this there is the problem of the budget deficit, whose expansion over the last two years has taken a worrying turn.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

BY Stéphane ALBY

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.