VZCZCXRO2060
PP RUEHTRO
DE RUEHTU #0394/01 1691033
ZNR UUUUU ZZH
P 181033Z JUN 09
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 6449
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUCNMGH/MAGHREB COLLECTIVE

UNCLAS SECTION 01 OF 02 TUNIS 000394 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EEB/CBA (WINSTEAD AND GILMAN) AND NEA/MAG (PATTERSON AND 
HAYES) 
STATE PASS USTR (BURKHEAD) AND USAID (MCCLOUD) 
USDOC FOR ITA/MAC/ONE (MASON), ADVOCACY CTR (TABINE), AND CLDP 
(TEJTEL AND MCMANUS) 
CASABLANCA FOR FCS (ORTIZ) 
CAIRO FOR FINANCIAL ATTACHE 
LONDON AND PARIS FOR NEA WATCHER 
 
E.O. 12958: N/A 
TAGS: ECON EINV EFIN ETRD TS XA
SUBJECT: TUNISIA: ECONOMIC HIGHLIGHTS 
 
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Summary 
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¶1. (U) This cable contains highlights of recent economic 
developments in Tunisia: 
 
¶A. New Trade Minister 
¶B. Tunisia Targets Sub-Saharan Africa for Trade 
¶C. Tunisian Auto Parts Industry Rescued by FDI 
¶D. Tunisia Tourism Revenue Up Three Percent 
¶E. Morocco and Tunisia Plan Direct Currency Exchanges 
 
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New Trade Minister 
------------------ 
 
¶2. (U)  On June 10, President Ben Ali and Prime Minister Ghannouchi 
announced a partial cabinet reshuffle in which Mr. Ridha Ben Mosba 
replaced Mr. Ridha Touiti as Trade and Handicrafts Minister.  Touiti 
was appointed Delegate Minister to the Prime Minister.  Further 
details in septel. 
 
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Tunisia Targets Sub-Saharan Africa for Trade 
-------------------------------------------- 
 
¶3. (U)  In response to the recent sharp decline in demand from 
European trading partners, Tunisia is seeking opportunities and 
trade agreements in sub-Saharan Africa.  Tunisian Commerce Secretary 
of State Chokri Mamoughli announced these new initiatives at a press 
conference on May 28 prior to leaving for Gabon and the Democratic 
Republic of Congo. 
 
¶4. (U)  With limited diplomatic and banking links and a lack of air, 
rail, and road connections, trade with sub-Saharan Africa represents 
only 1.4 percent of Tunisia's overall export market.  (Note: The 
European Union receives nearly 80 percent of Tunisia's exports.) 
The GOT plans to improve Africa's share to 2.4 percent by 2011 
through increased trade with Ethiopia, Senegal, Cote d'Ivoire, the 
Democratic Republic of Congo, and Gabon. 
 
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Tunisian Auto Parts Industry Rescued by FDI 
------------------------------------------- 
 
¶5. (U) The Tunisian car parts industry grew during the first four 
months of 2009, according to official data. Tunisian authorities are 
reporting 15 percent growth in the automotive cable harness sector 
compared to the same period last year, with up to 25 percent growth 
among some manufacturers.  Foreign investment in the sector is 
credited with job creation: Kromberg & Schubert, established in 
January 2008, seeks to increase its employee base from 1,400 to 
2,200 by the end of 2009. 
 
¶6. (U) Comment: Despite positive official statistics, some industry 
insiders are reporting furloughs and stagnation.  However, 
manufacturers in the sector have seen some growth due to increased 
outsourcing from Eastern Europe to the Maghreb.  Tax incentives and 
relatively low cost production are motivating EU companies to shift 
production to Tunisia as a cost-cutting measure.  End Comment. 
 
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Tunisia Tourism Revenue Up Three Percent 
---------------------------------------- 
 
¶7. (SBU)  According to official figures, Tunisia's tourism revenue 
grew three percent to TND 1.098 billion ($904 million) in the first 
five months of the year, defying a slowdown in spending by European 
consumers.  The number of foreign visitors to Tunisia, 2.2 million, 
grew 1.3 percent from the same period in 2008.  Tourism revenue grew 
to TND 3.5 billion ($ 2.87 billion) last year, from TND 3.0 billion 
($2.37 billion) in 2007. (Comment: GOT claims of growth may not bear 
out in terms of hard currency, as the Tunisian Dinar has depreciated 
by 21 percent against the dollar and 1.64 percent against the Euro 
since 2008.  The full effect of the economic downturn on Tunisia's 
tourism industry will only be known after the peak summer tourism 
season.  Embassy will send in a longer analysis of the sector at 
that time.  End Comment.) 
 
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TUNIS 00000394  002 OF 002 
 
 
Morocco and Tunisia Plan Direct Currency Exchanges 
--------------------------------------------- ----- 
 
¶8. (U)  Morocco and Tunisia are expected to sign an agreement 
facilitating conversion between the Moroccan dirham and the Tunisian 
dinar, thereby allowing citizens of both countries to directly 
exchange currencies, according to press reports.  At present, there 
is no mechanism for direct currency conversion; Moroccans and 
Tunisians must first convert their currency into Euros or USD as an 
intermediary step. 
 
¶9. (U) Direct currency conversion would represent a further step in 
Tunisian-Moroccan economic cooperation.  In 2005, Tunisia allowed 
Moroccan bank Attijari to purchase and control a Tunisian bank, 
Banque du Sud, and Morocco licensed a Tunisian venture capital 
enterprise. 
 
¶10. (U) Comment:  The Tunisia-Morocco currency agreement is a 
positive step toward closer economic ties among North African 
countries.  Post will report septel on progress and challenges in 
Maghreb economic integration.  End Comment.