Country Risk Rating

C
A very uncertain political and economic outlook and a business environment with many troublesome weaknesses can have a significant impact on corporate payment behavior. Corporate default probability is high. - Source: Coface
A1A2A3A4BCDEVery Low RiskAcceptable RiskVery High Risk

Business Climate Rating

B
The business environment is mediocre. The availability and the reliability of corporate financial information vary widely. Debt collection can sometimes be difficult. The institutional framework has a few troublesome weaknesses. Intercompany transactions run appreciable risks in the unstable, largely inefficient environments rated B.
A1A2A3A4BCDEVery Low RiskAcceptable RiskVery High Risk

Strengths

  • Relatively well diversified economy: manufacturing, petrochemicals, transport, agriculture, tourism
  • Proximity to the European market
  • Natural resources (olives, phosphates and hydrocarbons), but dependent on weather conditions and subject to strikes
  • Tourism potential
  • Competitiveness of automotive, aeronautical and medical equipment produced in free trade zones

Weaknesses

  • Society under stress: youth unemployment (~39%), regional gap between seafront and interior, brain drain and illegal emigration, strikes and demonstrations
  • Concentration of power in the Presidency, weak popular support for the new institutions resulting from the Constitution introduced in 2022
  • Public sector resistant to reform and a wage bill that weighs heavily on the state budget
  • Tourism sector weakened by successive shocks and dependent on the European economy
  • Decline in competitive advantages (textiles, tourism)
  • Energy dependence
  • Prevalent informal economy that is harmful to public finances

Current Trends

Source:

Coface (04/2024)
Tunisia