Summary:

On 29 June 2023, the European Council held a strategic discussion regarding irregular migration and economic development in the Mediterranean region, with Tunisia featuring heavily in the conversations.

The head of the European Commission, Ursula von der Leyen – who visited Tunisia earlier in June with a delegation of European leaders – called the recent aid package for Tunisia totaling nearly €1 billion a “blueprint” for a managing irregular migration outside of European Union borders.

[mepr-show if=”loggedout”] Please login or purchase an InBrief membership to view the rest of this report [/mepr-show] [mepr-show if=”loggedin”]

Critics have condemned the plan, referring to it as a “cash for migrants” scheme which, in practice, outsources the management of the migration challenge to Tunisia. Tunisia leaders have continued to strongly insist that the country will not serve as Europe’s border guard, but have welcomed cooperation and funding.

Prior to the European Council meeting, the Prime Minister of the Netherlands, Mark Rutte – who participated in the EU delegation to Tunis earlier in June – indicated in a phone conversation with President Kais Saied that his country will pursue additional investments in Tunisia. He noted in particular plans to invest in renewable energy and water supplies.

Meanwhile, Tunisia has continued to pursue agreement and partnership with other international partners. This week, a Tunisian government delegation in China signed an agreement promising cooperation in technology and communication. The visit included exchanges with government officials as well as Huawei executives.

The Tunisian Space Association also signed an agreement with the Ghana Space Science and Technology Institute, which promises partnership on research, development and training with a focus on scientific observation that could inform agriculture, mining and other industries of interest to both countries.

Outlook:  

While the European Union has seemingly come to some level of internal agreement about next steps to address irregular migration, the strategy remains intertwined with the International Monetary Fund (IMF) loan package that is yet to be finalized. The aid plan proposed by the EU and other funding packages proposed by individual countries have indicated that funds will not be issued until a deal is reached with the IMF.

With the longer-term in view, an IMF deal requires Tunisia to agree to some systemic reforms that could help move the economy incrementally toward sustainability.

Recent reports have indicated that Tunisia plans to submit a revised set of economic reforms for consideration, but little clarity has emerged around this plan, including what the alternate proposal would include and how long a new negotiation process could take.

As negotiations over future aid continue, the risk of serious economic disruptions and civil unrest grow. Disruptions in heavily subsidized or nationalized industries have already caused challenges that could be exasperated as the economic shortfall goes unaddressed, leading to greater potential for unrest, protests, and backlash against the government from the public.

[/mepr-show]

Explore our services or speak with our team of North Africa-based risk experts.