Tunisia has built, in a decade, all the administrative attributes of a green financial system.
It has guides, international memberships, supervisory reports that mention climate, and a stack of sectoral tax incentives. What it still lacks is a market. No green bond has ever been issued in the country, neither by the state, nor by a state-owned enterprise, nor by a private issuer. The gap between the institutional architecture and its real activation is today the most striking feature of Tunisia’s green financial transition.
This is documented by a recent study from the Arab Institute of CEOs (IACE), which lays out a snapshot of the greening of the Tunisian financial system and compares it with the Egyptian and Moroccan trajectories. The central finding of the policy paper can be summed up in one sentence: the Tunisian green finance ecosystem depends more on the push of international donors than on market dynamics.
A Central Bank in an Observation Phase
The Central Bank of Tunisia joined the Network for Greening the Financial System as early as 2019, a move aligning with international standards for managing climate risks. Its 2024 annual report on banking supervision formally addresses the climate issue for the first time, and a 2023–2025 strategic plan sets the objective of gradually integrating this risk into banking regulation.
But the intention has yet to yield any bond issuance. No climate stress test has been imposed on banks, no specific prudential requirement governs green financing. The Central Bank of Tunisia continues to primarily finance traditional sectors, without environmental issues weighing on its monetary policy. IACE’s diagnosis is unambiguous: strategic directions are set, but their operational translation remains timid.
A guide without issuers
The Financial Market Council, for its part, has carried out the regulatory work. In collaboration with the Ministry of Finance and the International Finance Corporation, it published as early as 2021 a guide for issuing green, social, and sustainable bonds aligned with the standards of the International Capital Market Association. The Tunis Stock Exchange integrated ESG criteria into its 2024 report and joined the United Nations Sustainable Stock Exchanges Initiative.
The framework is thus ready. What is missing, according to the study, are climate projects bankable enough to offer a risk-return profile comparable to existing investments, reliable tools for pricing credit risk, and sufficient secondary market liquidity that would allow investors to exit their positions.
On the issuer side, the inability to demonstrate a tangible financial advantage, the so-called ‘greenium’, combined with transaction costs and high reporting requirements, particularly deters smaller-scale operations.
The funders, the only visible engines
In the absence of a domestic market, international financial institutions bear the bulk of Tunisia’s climate financing. The Green Climate Fund allocated 251 million dollars to the country between 2016 and 2025, spread across 19 projects.
The European Investment Bank mobilized 734 million euros between 2009 and 2025, mainly in energy, agriculture, and industry, with flagship projects such as the HVDC electrical interconnection between Tunisia and Italy.
The African Development Bank finances simultaneously the restoration of forest ecosystems, public-private solar projects, and the environmental rehabilitation of the Tunisian Chemical Group, for a loan of 110 million dollars. The French Development Agency, through its SUNREF label, mobilized around 37 million euros between 2018 and 2023 through local banks, while the World Bank recently approved the TEREG program for 430 million dollars aimed at enhancing the reliability of the electric grid.
This dependence has a structural consequence highlighted by the study: the Tunisian banking sector, insufficiently equipped to independently assess the profitability of green projects, offsets its uncertainty with high guarantees, which closes access to financing for a portion of project sponsors.
A Green Taxation Still Fragmented
The finance laws of 2024, 2025 and 2026 introduced a series of targeted measures: a form of carbon tax on energy and transport, a 50% VAT reduction for electric vehicles, subsidized loans for water management, a 1% tax on industry earmarked for an environmental justice fund.
None of these laws, however, establish a structural chapter for green finance. Tunisia continues to tax fuels while subsidizing them, a contradiction that the study interprets as the symptom of fragmented budget governance, where short-term trade-offs prevail over long-term climate commitments.
What the Regional Comparison Reveals
Compared with Egypt, the only regional country to have issued a sovereign green bond in 2020, and Morocco, where public enterprises accessed the green bonds market under an ESG framework imposed by Bank Al-Maghrib, Tunisia appears behind on almost all green governance criteria: mandatory reporting, regulatory management of climate risks, and preferential incentive rates.
The country shares NGFS membership with its neighbors, but remains alone in having undertaken no green issue, public or private.
What the Study Calls to Change
The IACE’s recommendations converge on the same idea: without binding institutional coordination, without systematic integration of climate criteria into the evaluation of public investments, and without a Climate Budget Tagging-style budgeting tracking mechanism, Tunisian green finance will remain a stack of pilot initiatives rather than a system.
The challenge, for the upcoming finance laws, is no longer to add sectoral measures but to construct the market architecture that would finally allow these international financings to find a sustainable domestic channel.
