Gearing up to EU level.

Position:Special Report: Tunisia - European Union

The buzz phrase in Tunisia nowadays is mise a niveau - which roughly translates as 'upgrading'. Specifically it stands for the all-round improvements necessary if Tunisia's economic performance is to come to par with that of Europe by 2008. In general, the term has entered the popular lexicon and stands for that great leap forward, that burst of effort that will propel an entire nation out of one status and onto a much higher level of living. You can feel mise a niveau in the attitude of taxi-drivers, traders, students, officials and all kinds of workers.

Tunisia's decision to deliberately raise its economic performance to the European level over a fairly short time frame was a bold one. "In fact, Tunisia was the first non-European country to come up with the idea," says Abdelhamid Triki, general manager of planning forecast at the Ministry of Economic Development. "Initially the EU did not want to talk about upgrading. Now Morocco and others want to follow our example," he adds.

What the EU realised was that the decision had been very carefully thought out, the risks assessed, contingency provisions made and a detailed plan prepared. Tunisia was ready for the big adventure and had the will to carry it through.

Over the next nine years, the association agreement will gradually dismantle trade barriers to the import of EU-manufactured goods into Tunisia. Mise a niveau is the process designed to prepare Tunisian industry for the great challenge that lies ahead. It also means gradually, but eventually completely, restructuring the Tunisian economy so that the entire competitive sector comes into the private domain.

"We began the process in 1996," says Mohamed Ghannouchi, Minister for International Cooperation and Foreign Investment. "There are several prongs to the programme: we have to upgrade our infrastructure, the financial and regulatory institutions, communications and administration. Through government subsidies, we have to push the private sector into greater efficiency, cut the costs of production, open up capital to foreign investors and make companies more responsive to market demands. Finally, we have to inculcate a new culture of productivity and creativity among the workforce."

The aim is to target 4,000 enterprises for upgrading during the initial five-year period, followed by a consolidation period of another five years as tariffs come down more quickly. So far, 811 firms have applied for the upgrading and 369 have been...

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