Tunisia shows lower competitiveness in attracting FDI compared to Egypt, Morocco (IACE)

Tunisia has a significantly lower competitiveness in attracting foreign investment compared to Egypt and Morocco," according to a comparative study conducted by the Arab Institute of Business Leaders (IACE) across North Africa for the period 2003-2022.The study, entitled "Foreign Direct Investment (FDI) in Tunisia between Attractiveness and Retention", was published on Friday.Egypt stands out as the leading destination for new foreign investment in the region, particularly during the post-COVID-19 recovery period, while Tunisia is struggling to regain its pre-pandemic appeal.The IACE noted that "Tunisia and Morocco were almost equal in terms of FDI inflows in 2010, but since then the gap has widened due to Tunisia's underperformance and Morocco's remarkable results".In a comparative analysis of North African countries, Tunisia emerges with "the lowest number of new investments compared to Egypt and Morocco"."The evolution of FDI volume largely reflects the country's attractiveness for investment; h owever, it is crucial to distinguish between reinvestment or expansion and new foreign investment," IACE said."Since 2014, the number of expansions of foreign projects in Tunisia has consistently exceeded the number of new creations, indicating an ability to retain and sustain existing foreign investments, with increasingly significant reinvestment efforts, all in a context of limited attractiveness for new investments."Building on this observation, the Institute assessed that "policymakers have a dual objective" of retaining and sustaining existing foreign investment by promoting a favourable investment climate capable of safeguarding the jobs created, while at the same time seeking to attract new FDI.The study highlighted the need to identify the expectations of foreign investors and to initiate a branding strategy to improve Tunisia's positioning as an attractive destination for foreign investment.Source: Agence Tunis Afrique Presse