Tunisia: Pursuit of Gulf Financing Could Mean Entering Normalization Fray
Summary:
In late July 2023, the Rights and Freedoms Committee of the Tunisian parliament announced plans to explore the introduction of a law that would criminalize normalization of relations with Israel.
The announcement comes as rumors and increasingly open discussions have swirled that the US is pushing Saudi Arabia to officially normalize relations with Israel. While the US has worked to temper expectations, these events have shifted the discussion around normalization for many Arab states with the United States viewing Saudi Arabia as an influential partner in the region that other Arab states might follow.
In late 2022, former Prime Minister Najla Bouden caused controversy by exchanging pleasantries with the Israeli President during a photo shoot. Significant criticism followed, as well as rumors that some effort toward normalization could be underway.
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Similar rumors resurfaced following the early May 2023 shooting attack at the Ghriba Synagogue in Djerba, which prompted discussions related to antisemitism in Tunisia, as well as the nature of the country’s relationship to the state of Israel.
More recently, a Tunisian singer’s performances in Tunisia were cancelled after she performed concerts in Israel for what she claimed were Palestinian audiences. The perception of her “normalization” prompted organizers to cancel her performances.
President Kais Saied has been a vocal critic of Israel, making his support for Palestine and Palestinians a prominent part of his agenda.
In May, the Algerian People’s Assembly saw legislation introduced that would criminalize normalization – an effort attempted previously in that country.
Meanwhile, in late 2020, Morocco began the process of normalizing diplomatic and commercial relations with Israel, an effort that has continued and increased in scope over time.
Outlook:
Following the recent announcement that Saudi Arabia will provide $500 million in financial assistance to Tunisia, additional efforts were made to warm relations with other Gulf states.
The Gulf has long been considered the most viable secondary source of funding after the International Monetary Fund (IMF), with several Gulf states having a history of strategically-timed investments in Tunisia.
However, with apparent ongoing discussions between regional powers regarding expansion of the Abraham Accords, there is potential that Tunisia’s search for funding draws the country into the broader negotiations.
Financing deals with Gulf partners could come with requests for future support of a benefactor’s position regarding Israel. With Tunisia’s financial situation increasingly dire, such deals could become attractive, particularly when compared with the austerity measures included in the IMF loan deal.
Tangible steps toward normalization would carry risk of domestic instability as many Tunisians hold strong pro-Palestinian and anti-Israeli views. Our team is continuing to monitor the potential impacts on the risk environment in Tunisia as the broader regional discussion around normalization develops.
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