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INFO RUEHAD/AMEMBASSY ABU DHABI PRIORITY 0791
RUEHAS/AMEMBASSY ALGIERS PRIORITY 7280
RUEHLO/AMEMBASSY LONDON PRIORITY 1176
RUEHNK/AMEMBASSY NOUAKCHOTT PRIORITY 0779
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RUEHRB/AMEMBASSY RABAT PRIORITY 8210
RUEHTRO/AMEMBASSY TRIPOLI PRIORITY 0388
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RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY

UNCLAS TUNIS 002329 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/MAG (HARRIS) AND EB/CIP 
STATE PASS USTR (BELL), USPTO (ADLIN), USAID (DMCCLOUD) 
USDOC FOR ITA/MAC/ONE (ROTH), ADVOCACY CTR (JAMES), AND 
CLDP (TEJTEL) 
CASABLANCA FOR FCS (RORTIZ) 
LONDON AND PARIS FOR NEA WATCHER 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR LY TS
SUBJECT: BEN GUERDANE'S "LIBYAN SOUK": CHEAP GOODS, BIG 
INCOME 
 
 
¶1. (SBU) Summary:  In the "Libyan souk" of Ben Guerdane, a 
town 30 kilometers from the Tunisian-Libyan border, Tunisians 
can pay bargain prices for questionably imported, often 
counterfeited goods from Libya.  Although the GOT asserts 
that it is committed to intellectual property right 
protection and enforcement, the souk is an important source 
of income for many unemployed Tunisians-- a subject of acute 
and overriding concern for the government-- and thus is 
allowed to operate freely.  End Summary. 
 
¶2. (SBU) The city of Ben Guerdane is located 30 kilometers 
from Tunisia's border with Libya and is an important transit 
point between the two countries.  But for many Tunisians, Ben 
Guerdane is itself the final destination.  Tunisians travel 
from across the country to purchase the cut-rate clothing, 
electronics, housewares, and tires that can be found in what 
is popularly known as the "Libyan souk."  Every day from 6 am 
to 6 pm the Libyan souk in Ben Guerdane opens for business, 
boasting hundreds of stalls, some permanent and some 
makeshift, but each filled to the brim with cheap goods of 
dubious origin. 
 
¶3. (SBU)  Nearly all the goods have entered Tunisia via the 
Libyan border, often smuggled across in cars and trucks 
during the night to evade customs officials.  While goods of 
Libyan origin are not subject to customs duties, the majority 
of products are from Egypt or China.  In addition to their 
questionable entrance into the country, many goods are also 
counterfeit and bear familiar, but often misspelled, brand 
names such as Nike, Pansonic, and Phillibs. 
 
¶4. (SBU) While the the quantity of smuggled goods is 
significant, the trafficking is apparently not the work of 
organized smuggling rings but is largely done by individual 
Tunisian families.  One family member crosses the border by 
car or truck into Libya and returns with it full of goods, 
which the family then sells at the market.  On the August day 
EconOff visited the souk, even the children were hard at 
work, using wheelbarrows to move wares from cars to the 
stalls or even manning the shops.  While some families are 
lucky enough to occupy permanent concrete shops, others have 
created makeshift stalls or sell their goods directly out of 
their cars.  According to several contacts, this is often 
these families' only source of income. 
 
¶5. (SBU) Despite the illegality of the majority of goods sold 
at the souk, the Government of Tunisia considers all 
purchases made within the souk to be legal.  The souk itself 
it located on GOT property and several Tunisian police 
officers are present at the entry points to the souk.  For a 
fee of three dinars, shoppers can legalize their purchases by 
receiving a receipt to present to Tunisian customs officials 
showing that they purchased the goods in Ben Guerdane and did 
not import them. 
 
¶6. (SBU) Comment: The market's existence highlights not only 
to the informal linkages between Tunisia and Libya, but also 
the GOT's acute concern about unemployment.  With the 
official unemployment rate hovering at 15 percent, and the 
actual rate even higher, the government is reluctant to 
eliminate the only source of income for many Tunisian 
families. Despite the GOT,s stated commitment to counter 
piracy and counterfeit products, its authorization of a 
market like Ben Guerdane is unlikely to end until alternative 
employment options exist for the families involved.  End 
comment. 
BALLARD