Tunisia has traditionally been perceived as a paragon of good practices in logistics in the MENA region. According to the Logistic Performance Index 2012, Tunisia is the best performer within the MENA region with a score of 3.17 over 5 (after U.A.E and Saudi Arabia) when Egypt scored at 2.98, Morocco 3.03 and Algeria 2.41. Tunisia also performs better than the regional benchmark countries in the trading-across-borders ranking of the Doing Business indicator. Tunisia is ranked 40th, far before Turkey (67th rank), Morocco (72nd rank) and Algeria (122nd rank).
At the same time, many importers in Tunisia complain about the inefficiency of Radès, the main Tunisian port, corruption in customs, and so on-- apparently with good reasons: dwell time, which is a good proxy for logistics efficiency, is benchmarked at around 3-4 days in middle income countries, whereas in Radès dwell time is officially around 6 days and more than 9 days according to the recent Tunisia investment climate assessment (with high dispersion), making it comparable to Mombasa in Kenya and much worse than a port like Durban in South Africa.
Who is right? Actually, both may be right. In an economy where political connections are so crucial, it depends on who is interviewed. It is what had been described in the Privilege to Competition book in 2009: answers on constraints to private sector growth were very different from who had been interviewed in a same country.
Hibou (2011) in the The Force of Obedience explained: “Once [foreign firms] have passed the entrance gate into Tunisia, they are protected from the predatory activities of greedy intermediates. Since most firms were investing in sectors that had been considered to be high priority by the central power, they would do everything to respect the rules and even distort or violate some of these rules in favor of foreigners”. She described how foreign companies were in general exempted from several predatory practices. This may explain why indicators such as the Logistics Performance Index have been relatively good for Tunisia: The sample was biased in favor of non-Tunisian firms and global operators interviewed benefited from being “fast tracked” in Tunisia during Ben Ali’s time.
It is now documented how on one hand, Ben Ali accelerated the integration in the world economy with free trade agreements and the development of an economic partnership with Europe and on the other hand, accelerated his control over the administration.
One could argue that this dual economy enabled a “Tunisian miracle”. However, discretion and arbitrariness against some onshore firms seems to have contributed to the fall of Ben Ali and was likely to be unsustainable.
It is worth noting that between 2010 and 2012 Tunisia improved significantly, rising from 2.83 to 3.17 (from 61 to 41th rank) despite a lack of apparent reforms in this area. This could be explained by a “below the radar” reform. But a different explanation is that, with a relatively disorganized customs administration (six heads of customs since the revolution) and eroding customs revenues, some foreign firms found it easier to go through the customs clearance process and therefore considered Tunisia more positively.
In short, global indicators, which are mainly dependent on global operators to have a worldwide coverage, will always have difficulties portraying reality in economies where foreign firms benefit licitly or illicitly from privileges. If we only listen to firms that manage to navigate the complex Tunisian bureaucracy, perhaps it is not such a surprise that LPI results are good. The challenge is to listen to domestic firms that may not be protected politically…