What is the contribution of FDI in terms of job creation in Tunisia?
15 April 2013
Read by 1684 persons
In this article, Guillaume Almeras, an international consultant on economic and financial development issues, analyzes the situation of FDI in Tunisia on the econostrum.info portal, with the most critical title: "The disillusionment of FDI: the Tunisian example".
In the introduction to his analysis, Almeras emphasizes that "for nearly fifteen years, foreign direct investment (FDI) has been considered one of the most important, if not the main, keys to economic development in the Mediterranean countries. Promoting FDI has thus been one of the most constant and priority tasks of these countries, in total contrast to the attitude of emerging countries which, when they have not directly taxed them (Thailand, Brazil), have always authorized them with great reserve (South Korea, China, India). But in the Mediterranean, nothing could tarnish the favor enjoyed by FDI".
Then, the expert considers it unfounded to "distinguish between productive FDI and speculative FDI, real investments from simple portfolio investments". From there, he wonders what these latter bring?", then replies: "An immediate influx of foreign currency, certainly, but, in the long term, a net outflow of foreign currency for the host country corresponding to the repatriation of capital and interest or interest exceeding the initial capital…".
Almeras concludes at this level that "we cannot therefore simply speak of "FDI" and, if we must try to see a little more clearly in this regard, we must prepare for some surprises". And it is Tunisia which "…offers a good example, following the figures published by its foreign investment promotion agency (FIPA)".
Indeed, these figures show that FDI (excluding energy) received by Tunisia, from 2006 to 2012, "…only created 59,048 net jobs, far below the needs of a country experiencing significant underemployment".
The expert recalls that "in 2012, the five main investors in Tunisia were: Qatar (48% of FDI), France (24%), Italy (8%), Germany (6%), Kuwait (2%)". This being so, he notes that for this year, the investors who created the most jobs in Tunisia are "France (36% of jobs generated by FDI), Italy (18%), Germany (16%), Belgium (5%), Switzerland (3%)"; in other words, Qatari funds did not create much in Tunisia in terms of jobs.
However, he specifies that "we can better emphasize that there is no direct link between FDI, taken globally, and job creation only by comparing the percentages of the two previous lists". Thus, to the question of knowing "which countries are today the most present in Tunisia through companies wholly or partly owned by them?", Almeras replies that it is "France (41% of foreign-owned companies), Italy (24%), Germany (7%), Belgium (6%), the United Kingdom (2%)". And adds: "In productive terms, therefore, Germany or Belgium are much more efficient investors for Tunisia than Qatar or Kuwait".
Questioning Euro-Mediterranean orientations
From there, the expert mentions "…the countries that have invested the most in the Tunisian manufacturing sector since 2006", which are France (28% of FDI in this sector), Italy (18%), the United Kingdom (14%), Spain (9%), Germany (8%).
Concerning "the countries that have proportionally created the most jobs per Dinar invested", in the expert's calculations "these are, in order, Belgium (0.36 jobs per 1,000 TND invested), Luxembourg (0.23 jobs), the Netherlands (0.18 jobs), Germany (0.18 jobs) and the USA (0.17 jobs)". It goes without saying that "we do not find in this list any of the most important investors in terms of amount from 2006 to 2012: UAE, France, Qatar, Italy. By comparison, Italy created 0.08 jobs per thousand TND invested and France 0.06 jobs".
"Therefore, we must go further and, in view of the elements we have just presented, not hesitate to question two orientations that have been decisive within the framework of Euro-Mediterranean policies since the Barcelona Protocol", emphasizes Almeras.
Thus, within the framework of "Necessary analyses of FDI flows", the expert indicates that "among foreign investors in Tunisia, France and Italy are two heavyweights, but, compared to the volume of their investments, they are not the biggest job creators. And this leads to reconsidering what could be called "the myth of call centers": the Maghreb finds anchorages in Northern Europe and its economic destiny is perhaps not to become mainly the industrial suburb of Southern Europe. Things, in any case, cannot be thought of so simply".
Here too, Almeras challenges "the idea of a triangular solution: EU/Mediterranean countries/Gulf countries" which, according to him, "could well be nothing more than a lure". Indeed, "since 2006, Saudi Arabia has created 6,160 jobs in Tunisia… While the significant contributions of Qatari funds in 2012 mainly corresponded to the acquisition of 15% of Tunisiana". As a result, "…it is quite easy to understand that the Gulf sovereign funds are, by their very nature as instruments for managing national wealth, in search of relatively secure investments rather than investments in the industrial sense of the term"…
General conclusion of the expert on FDI: “…we can only call for more analysis of FDI flows, as well as more circumspection in the face of development policies that make them the essential lever for job creation and growth. But we can unfortunately doubt that these few remarks can even begin to tarnish the favor with which FDI is viewed on the South Shore of the Mediterranean…"
Let us hope that FIPA, in particular, and the government, in general, will carefully read this analysis of FDI in Tunisia.
T.B.
Source: econostrum.info
Published on April 10, 2013.
Posted online on April 15, 2013.
Webmanagercenter.com
In the introduction to his analysis, Almeras emphasizes that "for nearly fifteen years, foreign direct investment (FDI) has been considered one of the most important, if not the main, keys to economic development in the Mediterranean countries. Promoting FDI has thus been one of the most constant and priority tasks of these countries, in total contrast to the attitude of emerging countries which, when they have not directly taxed them (Thailand, Brazil), have always authorized them with great reserve (South Korea, China, India). But in the Mediterranean, nothing could tarnish the favor enjoyed by FDI".
Then, the expert considers it unfounded to "distinguish between productive FDI and speculative FDI, real investments from simple portfolio investments". From there, he wonders what these latter bring?", then replies: "An immediate influx of foreign currency, certainly, but, in the long term, a net outflow of foreign currency for the host country corresponding to the repatriation of capital and interest or interest exceeding the initial capital…".
Almeras concludes at this level that "we cannot therefore simply speak of "FDI" and, if we must try to see a little more clearly in this regard, we must prepare for some surprises". And it is Tunisia which "…offers a good example, following the figures published by its foreign investment promotion agency (FIPA)".
Indeed, these figures show that FDI (excluding energy) received by Tunisia, from 2006 to 2012, "…only created 59,048 net jobs, far below the needs of a country experiencing significant underemployment".
The expert recalls that "in 2012, the five main investors in Tunisia were: Qatar (48% of FDI), France (24%), Italy (8%), Germany (6%), Kuwait (2%)". This being so, he notes that for this year, the investors who created the most jobs in Tunisia are "France (36% of jobs generated by FDI), Italy (18%), Germany (16%), Belgium (5%), Switzerland (3%)"; in other words, Qatari funds did not create much in Tunisia in terms of jobs.
However, he specifies that "we can better emphasize that there is no direct link between FDI, taken globally, and job creation only by comparing the percentages of the two previous lists". Thus, to the question of knowing "which countries are today the most present in Tunisia through companies wholly or partly owned by them?", Almeras replies that it is "France (41% of foreign-owned companies), Italy (24%), Germany (7%), Belgium (6%), the United Kingdom (2%)". And adds: "In productive terms, therefore, Germany or Belgium are much more efficient investors for Tunisia than Qatar or Kuwait".
Questioning Euro-Mediterranean orientations
From there, the expert mentions "…the countries that have invested the most in the Tunisian manufacturing sector since 2006", which are France (28% of FDI in this sector), Italy (18%), the United Kingdom (14%), Spain (9%), Germany (8%).
Concerning "the countries that have proportionally created the most jobs per Dinar invested", in the expert's calculations "these are, in order, Belgium (0.36 jobs per 1,000 TND invested), Luxembourg (0.23 jobs), the Netherlands (0.18 jobs), Germany (0.18 jobs) and the USA (0.17 jobs)". It goes without saying that "we do not find in this list any of the most important investors in terms of amount from 2006 to 2012: UAE, France, Qatar, Italy. By comparison, Italy created 0.08 jobs per thousand TND invested and France 0.06 jobs".
"Therefore, we must go further and, in view of the elements we have just presented, not hesitate to question two orientations that have been decisive within the framework of Euro-Mediterranean policies since the Barcelona Protocol", emphasizes Almeras.
Thus, within the framework of "Necessary analyses of FDI flows", the expert indicates that "among foreign investors in Tunisia, France and Italy are two heavyweights, but, compared to the volume of their investments, they are not the biggest job creators. And this leads to reconsidering what could be called "the myth of call centers": the Maghreb finds anchorages in Northern Europe and its economic destiny is perhaps not to become mainly the industrial suburb of Southern Europe. Things, in any case, cannot be thought of so simply".
Here too, Almeras challenges "the idea of a triangular solution: EU/Mediterranean countries/Gulf countries" which, according to him, "could well be nothing more than a lure". Indeed, "since 2006, Saudi Arabia has created 6,160 jobs in Tunisia… While the significant contributions of Qatari funds in 2012 mainly corresponded to the acquisition of 15% of Tunisiana". As a result, "…it is quite easy to understand that the Gulf sovereign funds are, by their very nature as instruments for managing national wealth, in search of relatively secure investments rather than investments in the industrial sense of the term"…
General conclusion of the expert on FDI: “…we can only call for more analysis of FDI flows, as well as more circumspection in the face of development policies that make them the essential lever for job creation and growth. But we can unfortunately doubt that these few remarks can even begin to tarnish the favor with which FDI is viewed on the South Shore of the Mediterranean…"
Let us hope that FIPA, in particular, and the government, in general, will carefully read this analysis of FDI in Tunisia.
T.B.
Source: econostrum.info
Published on April 10, 2013.
Posted online on April 15, 2013.
Webmanagercenter.com
