Suma Chakrabarti, President, the European Bank for Reconstruction and Development (EBRD): Interview

Interview: Suma Chakrabarti

In what ways can Tunisia sustain inclusive growth?

SUMA CHAKRABARTI: Inclusive growth is a key priority for the authorities in Tunisia. This involves tackling regional disparities, fostering job creation across the country and providing an attractive business climate. In response to this challenge, the EBRD has been focusing its investments and technical assistance in Tunisia by supporting the private and financial sectors, and developing a resilient and diverse economy.

In addition, good and reliable infrastructure is another key component of a strong economy. Together with other international financial institutions, we are eager to encourage a higher level of private sector involvement in infrastructure-related sectors. The EBRD financed a key project in private health care, for example, and it was together with the private sector that we invested in the clean-up of Lake Bizerte. We are also working to improve energy security by helping the national utility company strengthen its network, promote energy efficiency and develop renewable energy.

What role can Europe play in helping to stimulate job creation in Tunisia?

CHAKRABARTI: We cannot think about economic ties and job creation without thinking about trade and investment. Trade has a positive impact that goes well beyond simply importing and exporting goods. Many jobs in retail, wholesale, port handling, logistics and transport can be directly traced back to trade. Tunisia offers attractive conditions to foreign companies, including a highly skilled and competitive work force and a strategic geographic position.

The most promising sectors are industry, commerce and telecoms. European investment and know-how are key to the development of the automotive, mechanical and electronic sectors.

Skills and vocational development through knowledge transfer, and the development of local talent, are essential for Tunisia’s future growth. Europe has also been providing funds for technical assistance and experts to transfer knowledge.

How can informal economic activity be reduced?

CHAKRABARTI: From the beginning of our work in the country, the EBRD has engaged in discussions with the Tunisian authorities about reforms and steps towards macroeconomic stability and improved corporate governance. Our joint goal is to make the business environment more attractive. For this, it is important to improve the rule of law and to ensure that the way laws are implemented is transparent and predictable. We know full well that reducing informal activities is a long-term, complex process. Another important step is clearly regulated access to finance, and with the 2016 budget law, the government is taking important measures in that direction.

To what extent do public-private partnerships (PPPs) play a role in Tunisia?

CHAKRABARTI: As infrastructure projects are long-term projects, it is important for PPPs to be included within long-term strategies. The private sector is the engine of the economy and produces growth and jobs, but clear priorities also have to be established.

To achieve sustainable infrastructure in a country, large amounts of private and public financing must be mobilised. The financing has to be twinned with a strong commitment by the authorities to implement the necessary reforms. It is crucial for infrastructure projects to be commercially viable.

To achieve this, we are assisting the authorities in preparing elements of a new PPP law, which was recently approved by parliament. The EBRD will also be working to attract investors once PPP projects are launched. The EBRD supports decentralisation and promotes commercialisation, while working on policy dialogue and the modernisation of regulations.