The Tunisian industrial fabric has, for several decades, rested on a structure that is relatively stable but deeply imbalanced, the orders of magnitude of which should be considered as estimates.
Three major groups coexist:
– The first, and by far the most dominant, is that of fully exporting companies operating within the framework of international subcontracting. It accounts for about 45% to 50% of industrial enterprises, but especially nearly 60% to 65% of industrial employment. This segment is concentrated in sectors such as textiles and clothing, electrical and electronic industries, or automotive components. In some cases, like textiles, the share of offshore companies exceeds 80%. These units are strongly integrated into European value chains and operate according to a cost-driven logic, with limited autonomy in terms of design, innovation, or marketing. High value-added functions are most often located outside the national territory.
– Alongside this dominant block there exists a smaller but strategic segment, that of hybrid enterprises, representing about 20% to 25% of the industrial fabric. These companies combine activity oriented toward export, often in connection with international partners, and a presence on the local or regional market. They concentrate a growing share of industrial value added and begin, in some cases, an upgrading through the development of engineering capabilities, diversification of markets, or production under their own brand. This core today constitutes one of the main potential vectors for transforming the Tunisian industrial model.
– Finally, a third group brings together companies oriented toward the domestic market, representing about 30% to 35% of the industrial fabric. Active in food processing, construction materials, or consumer goods, they play an essential role in economic stability and local market supply, but remain relatively unexposed to international competition and often limited in terms of productivity gains and innovation.
This particular structuring of the industrial fabric has direct consequences on the economy’s ability to create stable jobs and purchasing power. The predominance of international subcontracting translates into low local value added. In many cases, the local content of production remains limited, sometimes estimated at only 25% to 35% in certain industrial segments.
The model rests above all on a cost comparative advantage, notably in terms of labor, which limits the prospects for rapid upgrading. Strategic functions, such as research and development, design, or marketing, remain largely outsourced, which reduces the capacity for technological learning and accumulation of “intangible” capital at the national level.
In terms of employment, if the industry continues to represent a significant share of formal employment: around 30% according to estimates; its ability to generate skilled and well-paid jobs remains insufficient. The offshore sector, which absorbs a large part of the workforce, essentially creates low-skill and low-wage jobs. This situation directly weighs on purchasing power and limits the emergence of a solid industrial middle class, yet essential for balanced growth.
Furthermore, the strong dependence on external markets, notably European, which absorb more than 70% of Tunisian industrial exports according to available magnitudes, exposes the national economy to fluctuations in the international conjuncture. Economic slowdowns in Europe, reconfigurations of value chains, or competition from lower-cost countries can have immediate effects on industrial activity and employment.
To these structural limits is added a deeper problem linked to industrial demographics. Renewal of the productive fabric remains insufficient. The creation of new industrial enterprises, notably in high value-added sectors, remains limited and does not fully compensate for disappearances, closures, or the decline of certain traditional branches. This renewal deficit translates into stagnation, or even progressive erosion, of the industrial base. Tunisian industry struggles to transform and diversify at a pace sufficient to respond to technological changes and the demands of international competition.
The most striking signal of this evolution remains the decline of the industry’s share in gross domestic product. It fell from about 21% in 1990 to 17% in 2010, then to nearly 15% in 2020, i.e., a decrease of about 6 to 7 points in three decades. This trajectory signifies a process of relative deindustrialization. It does not necessarily mean an absolute contraction of industrial production, but rather a weakening of its role in creating national wealth relative to other sectors.
This decline is the combined result of several factors: the fatigue of the subcontracting model, insufficient productive investment, financial constraints, increased international competition, and the absence of a sufficiently dense ecosystem of innovative companies capable of driving growth.
In this context, the question of a deep reform of industrial policy arises with acuity. One of the first tasks concerns public enterprises, notably in the energy and transport sectors, whose financial situation weighs heavily on the entire economy. The accumulation of substantial debts limits their investment capacity and indirectly affects the competitiveness of the productive fabric. Resorting to a defeasance mechanism appears as an option to consider. This device consists of transferring the accumulated debts to a specific structure, often state-backed, tasked with managing them over the long term. The objective is to clean up the balance sheets of the companies concerned, restore their ability to act, and allow a restart of investment without being hindered by the weight of liabilities. By isolating inherited debts, defeasance offers the possibility to restart on healthier financial foundations.
Beyond this measure, a broader reorientation of economic policy instruments is necessary. The implementation of a multiannual financing law-program, linked to a genuine strategic planning, would provide visibility to economic actors and concentrate resources on priority sectors. The financing issue is central: a significant portion of bank credit remains directed today toward activities that are not very productive. Establishing mechanisms of directed credits toward industry, or even equity participation similar to Landesbanken (state banks), particularly in favor of small and medium-sized enterprises, could help correct this allocation and stimulate productive investment.
Paralleling this, public procurement (see our previous article published in TN) can play a structuring role by directing demand toward local production and supporting the emergence of integrated industrial supply chains. Other levers can complement this setup, such as strengthening incentives for innovation, developing sectoral clusters (denser cross-industry exchanges), improving access to industrial land, or promoting better local integration of production chains. The aim is to foster the emergence of a more diversified, more innovative, and more resilient industrial fabric.
In the end, the Tunisian industry stands at a decisive turning point. The model that supported its development for decades, based on low-cost subcontracting, has reached its limits today, while the transition to a higher value-added model remains incomplete.
The decline of its weight in GDP constitutes a warning signal. It highlights the need for a change of course aimed at strengthening the economy’s ability to create wealth, skilled employment, and purchasing power.
The refounding of the industrial model is no longer simply a strategic choice among others, but an essential condition to ensure the country’s economic and social sustainability in the medium and long term.
Hédi Sraieb, State Doctorate in Development Economics
