Event

Anti-government protests have further increased in the aftermath of opposition leader Mohamed Brahmi’s assassination on 25 July. Brahmi was the second member of the National Constituent Assembly (NCA; Tunisia’s interim parliament) killed this year. In February, the murder of Chokri Belaid, who was killed by the same weapon, had already led to heavy protests, the fall of then-PM Jebali and a reshuffle of the coalition government. Protesters and opposition parties themselves seem divided. Their demands vary broadly and include removing officials appointed by the government, dissolving the NCA, returning to the 1959 constitution, and overthrowing the government. Sluggish economic performance, high unemployment, increased insecurity and Salafist radicalism are fuelling public disappointment with the transition government, which is led by the moderate Islamist Al-Nahda party and includes left-leaning Ettakol and liberal Congrès pour la République. Meanwhile, NCA’s speaker declared the suspension of the body and further talks on Tunisia’s new constitution. Tunisia’s powerful trade union, Union Générale Tunisienne du Travail UGTT), has raised pressure on the government. Last week, PM Ali Larayedh announced that hardline Salafist Ansar al-Sharia would be classified as a terrorist organization as he accused the group of being responsible for the two MPs’ assassination.

Impact on country risk

Tunisia’s political crisis is severe, seriously affecting political stability and reforms, security risks and economic activity. Up to a certain level, a parallel can be drawn between the transitions in Tunisia and Egypt. In both countries, an increasing polarization between Islamists and secularists is being witnessed and an Islamist-led government is blamed for disappointing political and economic performance during the past year, in contrast to the high aspirations of their populations after the 2011 revolutions. However, despite some resemblance, the situation in Tunisia is much different. The current administration is a coalition government, in which both Islamists and secularists are represented. Tunisia’s army is not as powerful as Egypt’s and has not indicated its willingness to intervene in the political process. Moreover, public finances (although deteriorating) are in a less dire state than Egypt’s and Tunisia’s relations with the international (donor) community are more sound, the country having agreed on a Stand-By Arrangement with the IMF last April. Nevertheless, economic performance remains below what is required to tackle unemployment, poverty and regional disparities, which in turn feed growing dissatisfaction with the political transition process and risk deadlocking it all the way.

Analyst: The Risk Management Team, r.cecchi@credendogroup.com