Analysis of Agri-Food Trade Structures
To Promote Agri-Food Trade Networks
In the Islamic Countries
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The potential drivers, according to the sector´s stakeholders are:
1. Cultural proximity;
2. Complementarity (especially with remote countries);
3. Use of new technologies to reduce the cost of access to the regional market;
4. The competitive advantage for specific products (olive oil, dates, citrus);
5. New investment framework giving generous incentives to farmers;
6. The new regulations for the halal certification; and
7. Efforts to develop logistics (ports, road transport)
Conclusions and Lessons Learned
The Tunisian case study is interesting in different ways. Tunisia has chosen a liberalization
policy since the early 90s. The liberalization was gradual and different trade agreements were
signed (at the multilateral, regional and bilateral level). But these agreements did not concern
agricultural products which was not in favor of this strategic sector. Contrary to industry, the
agricultural sector is not benefitting from export opportunities. Tariffs as well as non-tariff
measures to trade are preventing the economy from an interesting source of economic growth.
Trade flows did not increase as much as could have been expected for this sector. In addition,
geographical conditions are their main drivers: Mediterranean countries (OIC and non-OIC
members) are the main partners for exports. Relations with other OIC member countries are
very small justifying the need for trade agreements and harmonization of regulations in order
to lower trade costs and reduce transaction costs. In addition, investment in infrastructure and
connectivity is required.
Tunisia considers trade relations as an opportunity, but modernization of the regulatory
framework is needed to have a win-win outcome (mutual recognition of standards, subsidies).
Also, the administration and the private sector need to be empowered in order to be able to take
advantage of trade liberalization and avoid frictions due to subsidies and anti-competitive
practices.
In parallel, the agricultural policy needs to be modernized. Instead of a price stability objective,
which favors consumers, the promotion of farmers’ income should be the aim of public policies
in this sector. In addition, the efforts to switch to high value added cultures, the increase in
productivity and the use of new technologies are necessary but not sufficient. Indeed, the
development of a quality approach (standardization, labels, organic products…) is necessary.
For that, financial and human resources are needed. The case of the Halal is the best example for
the relations with OIC member countries. The promotion of this certification is undoubtedly one
of the main channels to develop trade relations and increase value-added of exports.
In terms of more targeted conclusions, the review of data in this section, along with evidence
from semi-structured interviews, supports the following:
1. Tunisia’s exports are heavily concentrated on agri-food products, with that
concentration becoming more pronounced over time.
2. Tunisia’s export basket is relatively concentrated at a disaggregated level, with two
products (olive oil and fruit and nuts) accounting for 46% of total exports. Imports are