10/03/2015 - Tunisia has made great strides since 2011 towards greater inclusivity and fairness in its political system, based on the rule of law, transparency and good governance. The country now needs to adopt a new growth model to achieve its full potential and cement the democratic transition, according to two new OECD reports.

The Better Policies Series report Tunisia: A Reform Agenda to Support Competitiveness and Inclusive Growth points out that Tunisia’s old development model has run its course, as it has led to stark regional inequalities, frequent state intervention in the economy that stifles productivity, and high unemployment among women and young people, encouraging the latter to resort to informal employment or emigration. The OECD urges Tunisia to adopt far-reaching reforms to ensure the growth of business and entrepreneurship, and to lay the groundwork for a more dynamic, competitive, job-creating economy. The business climate can be improved by cutting red tape and easing price controls. The report also identifies the need to reduce the dualism of the job market and tackle regional inequalities through better targeted infrastructure and social policies. Moreover, it points to the need to secure economic stability by putting the banking system on a strong footing and bringing down the fiscal deficit.

OECD Secretary-General Angel Gurría in Tunisia. Photo: Presidency of Tunisia

Speaking in Tunis, OECD Secretary-General Angel Gurría declared: “Tunisia is showing a new face today, one which reflects the thirst for change of a whole generation of young Tunisians who went onto the streets in the hope of building a brighter future. These young people are the cornerstone of tomorrow’s shared prosperity. Now is the time to address the structural barriers that have for so long prevented this generation, and those living in poorer regions, from playing a full role in Tunisia’s economy and society." (Read the full speech in French).

 

The report Investing in Youth: Tunisia – Strengthening the Employability of Youth during the Transition to a Green Economy reviews labour market policies and the most promising social measures for removing barriers to employment. It makes four key recommendations:

• Improve youth employability with effective labour market and social policies. Measures that can be adopted in this field include an unemployment benefit system; the expansion and proper targeting of unconditional cash-transfer programmes (national welfare programme to support vulnerable families) in order to provide a social safety net; strengthened public employment services and support for entrepreneurs.
  
  
  
• Increase the attractiveness of hiring young people. This requires a constructive social dialogue that takes into account the situation of young people; reducing the gap between public and private sector wages and benefits; more targeted use of salary subsidies to encourage recruitment and more precise targeting of these subsidies at the underprivileged, underqualified and long-term unemployed.
  
  
  
• Increase the effectiveness of vocational education and training to support the transition from school to work. Vocational education and training, for example, should be made more attractive to prospective students, by facilitating transfers between general and vocational courses and by improving the quality of options in the final years of secondary education.
  
  
  
• Promote job prospects for young people in the green sector. The focus should be on areas that will create jobs or where existing skills can be adapted. These would most likely be renewable energy, waste and recycling, eco-tourism and exports of organically farmed produce, and the construction sector.

According to Investing in Youth, around two young workers in five are unemployed, and one in four young people is not in employment, education or training – a figure almost double that of most OECD countries. Youth employment in North Africa is a shared challenge, and Tunisia has everything it needs to serve as a model for this part of the world.

The Secretary-General also presented to government ministers OECD draft reports on open governance and global value chains.

For further information about Tunisia: A Reform Agenda to Support Competitiveness and Inclusive Growth and Investing in Youth: Tunisia, please contact Spencer Wilson or Caroline Tourrier in the OECD’s Media Division (+33 1 4524 9700).