THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Tunisia

Ranked 93rd of 149

At a glance

Ranks

93 rd on the Legatum
Prosperity Index™

92nd
95th
55th
105th
71st
61st
115th
136th
84th

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Tunisia performs best on Governance and Safety & Security and scores lowest on the Social Capital sub-index.

Visit our Rankings table to see how Tunisia compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Tunisia has the second smallest prosperity deficit in North Africa: it is slightly larger than Morocco’s but a great deal smaller than Algeria, Egypt, and Libya’s. Between 2007 and 2011, the year of the Arab Spring, Tunisia’s prosperity deficit quadrupled. Since 2012, however, its deficit has narrowed slightly but remains unable to fully translate social and political unrest into positive change.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

In late 2010, power shifted from the few to the many. A Tunisian street vendor set himself on fire in protest against a municipal officer confiscating his produce and oppressing his attempts at earning an income. Social unrest quickly began to spread throughout the Middle East and North Africa bringing together civilians who were dissatisfied with the existing system, leading to what is now called the Arab Spring. In Tunisia, as elsewhere in the Arab world, the protests and uprisings were not only due to high unemployment rates and rising poverty, but these were acts of desperation fuelled by the Arabs’ expectations for their lives and what they were actually experiencing. Unfortunately, Tunisian prosperity has declined since the Arab Spring, as is the case with many countries that went through the same experience.

Prosperity, Economic Quality, Business Environment, and Governance global scores in Tunisia from 2007 to 2016
While Tunisian Governance has improved since the Arab Spring, overall Prosperity, Economic Quality, and the Business Environment have continued to deteriorate

One important part of prosperity, however, did improve. Tunisia’s global rank in Governance has improved since 2012-13, reversing a trend of decline in the run-up to 2010-11. In 2013, Tunisia’s National Dialogue, a civil society institution, brought together various political factions to build and install a technocratic government. At the start of 2015, Tunisia emerged from deep political crisis with a democratic constitution and freely elected leadership. Within Tunisia’s Governance sub-index, the most striking change has been in its democracy level, which went from a semi-autocratic to democratic between 2010 and 2014. Other important improvements over the same period came in Tunisia’s judicial independence and rule of law scores, and in Tunisians’ political rights. The latter component variable measures the ability of citizens to participate in political processes like voting, joining parties, and running for office – it went from its lowest possible score in 2010 to its highest possible score in 2014.

Frustration with the way Tunisia was governed before 2010 largely explains the 2010-11 revolution, and it is encouraging that the revolution translated into the democratisation of Tunisia, unlike the continuation of bad or non-governance in its Arab neighbours. While Tunisia’s political system has been transformed, its economic model remains fossilised in the pre-2010 mould.

Economic inequality between rich urban centres along the coast and the deprived hinterlands is still an issue. Economic opportunity and public service delivery and quality differ drastically between these two regions. Unemployment remains at pre-2010 levels and there has been no economic diversification or any improvement in the quality of Tunisian exports. Markets are still dominated by state-owned firms and extensive regulations protect other firms from domestic and international competition. The two sharpest deteriorations within Tunisia’s Economic Quality sub-index came in the effectiveness of anti-monopoly policy and in the prevalence of non-tariff trade barriers. Markets are serving a narrow elite and a large bureaucracy that engages in corruption – one deteriorating component in Governance – and cronyism. In Tunisia’s Business Environment sub-index, we see that fewer Tunisians think the country is good place for starting a business and fewer think that they can get ahead by working hard now than they did in 2010. Tunisian physical business infrastructure has also deteriorated over the same period, and its business regulations have become more burdensome. These changes are problematic in themselves, but have other implications.

Tunisia’s Safety & Security rank has also deteriorated since 2010, which is in large part due to its failure to deliver economic prosperity to its citizens. It is ironic that the deprivation that set the Arab world alight in 2010-11, having started in Tunisia, is still there and is now feeding radicalisation across Tunisia’s disadvantaged regions. Increasing conflict with Islamic State sympathisers is also contributing to the declining security situation. The 2015 Sousse attack on Western tourists highlighted the extent of the problem, as have more recent attacks near the Libyan border. Tunisia must deliver economic prosperity along with ensuring strong governance to capitalise on the 2010-11 revolution.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.

Special Analysis

Special Analysis

OVERALL

Tunisia is the most prosperous country in North Africa, having dramatically improved its governance since the 2010-11 revolution. In order to arrest the decline in its global rank and to eradicate its prosperity deficit, economic liberalisation is needed.

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Areas of Success
Areas of Success

Tunisia’s governance rank has risen 18 places from 2013, as the dust from the revolution settled, to 2016. This has been due to a broad-based process of democratisation in which Tunisia bolstered its rule of law, judicial independence, and widened political rights for its citizens. Tunisia’s Governance performance places it 63 ranks above the next best ranked country in North Africa, Morocco, and is the main reason for its top overall prosperity rank in North Africa.

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Areas of Little Change
Areas of Little Change

Little change has been recorded by the Index in the Health sub-index. This is one area where Tunisia has failed to improve from an already-low level. Its Health rank places it below its neighbours Algeria and Libya, but above Morocco and Egypt. Of particular concern is mental health, as measured by Tunisians’ experiences of joy and sadness, which have both deteriorated since 2007.

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Areas of Improvement
Areas of Improvement

The main area for concern in Tunisia is Economic Quality and the Business Environment, where the Index records, respectively, a 27 and 56 rank decline since 2007. Economic reform has not yet come close to the country’s social and political reform since the 2010-11 revolution. The key weak spots are Tunisia’s anti-monopoly policy and its prevalence of non-tariff trade barriers, both hangovers from the last regime, which serve to protect the commercial interests of a narrow elite and provide a large bureaucracy with opportunities to extract bribes. More and more Tunisians think that their country is not a good place for starting a business and think that they are unable to get ahead by working hard.