Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
75898
November 2011
PPIAF Assistance in Tunisia
Tunisia is the northernmost country in Africa with an estimated population of just over 10.4 million. Tunisia
has a diverse economy, mostly in the agricultural, mining, tourism, and manufacturing sectors. Real
growth, which averaged almost 5% over the past decade, declined to 4.6% in 2008 and to 3–4% in 2009–
2010 because of economic contraction and slowing of import demand in Europe, Tunisia's largest export
market. The January 2011 Tunisian revolution has had a negative impact on the short-term economic
outlook, particularly in the area of tourism and foreign direct investment. Tunisia’s GDP, previously
expected to rise, is now projected to slow down, notably increasing the rate of unemployment. Despite the
country’s short-term challenges, its economic outlook remains positive. The interim government has
announced an economic and social emergency plan that outlines measures covering aspects of security,
employment, private sector growth and financing support, and regional development. Tunisia will need to
reach even higher growth levels to create sufficient employment opportunities for an already large
number of unemployed as well as the growing population of university graduates. To support job creation,
it is important to have a good business climate that includes sufficient infrastructure to support future
growth.
Technical Assistance for Enabling Environment Reforms
Tunisia’s Ministry of Development and International Cooperation requested the World Bank’s assistance
to review the perspectives and constraints for private participation in infrastructure in Tunisia. From a
Diagnostic Study, it aimed to transition to tangible policy reforms through a sequence of measures to
raise awareness and build consensus.
PPIAF assistance was requested in early 2003 to fund a study covering cross-sectoral aspects of private
participation in infrastructure in Tunisia, as well as a round table/dissemination workshop to discuss and
build consensus on the findings of the report and disseminate the study to stakeholders. The PPIAFfunded study consisted of an action plan to attract private participation in infrastructure, as well as a
report summarizing a legal study, macro-economic study, financial study, employment study, and report
on international experience.
The PPIAF-funded study and workshop held in Tunis on December 16–17, 2003 focused on, among
others, the following activities: 1) the phasing of sector reforms and private participation in infrastructure
transactions; 2) the possible creation and strengthening of regulatory institutions; 3) the identification of
priority sectors for private investment; 4) a financial analysis of key sector agencies and an analysis of the
economic, financial, and fiscal impact of private participation in infrastructure; 5) the possibility to
modernize the legal framework through a build-operate-transfer or concession law, similar to the
experience of other countries; 6) labor issues in private participation in infrastructure; and 7) definition of
possible measures to strengthen the capacity of the administration related to any of the areas listed
above.
The PPIAF-funded activity contributed to best practice in several ways. In particular, the close
involvement of government officials and local consultants in the study laid foundations for greater
ownership. Substance-wise, new types of contracts such as design-build-own, which had not been used
in Tunisia before, were introduced.
The government agreed to develop and publicize its own Private Participation in Infrastructure Strategy
and Action Plan based on the proposals made in the PPIAF-funded study. This included strengthening
the autonomy of the existing telecommunications regulator. In 2006 a 35% controlling stake in Tunisie
Telecom (the incumbent national fixed line and mobile operator) was divested for $2.25 billion. To date,
an additional 4.6 million people in Tunisia now have access to telecommunications, $643 million was
committed to be invested in telecommunications assets and $80 million in revenues is expected to be
remitted to the government. The Private Participation in Infrastructure Strategy and Action Plan also
included several options for improved cost recovery in solid waste management and created a
commission charged with the drafting of a Framework Law for Concessions. The resulting Law 2008-23
was adopted in April 2008.
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The government also acknowledged the need to separate the regulatory and operating functions in the
port and airport sectors, and different models for trading electricity were discussed. In water and
sanitation, the two national public enterprises and the respective sector Ministry acknowledged the need
to broaden private sector participation beyond sub-contracting and build-operate-transfer contracts, but
no next steps were agreed to.
Results of PPIAF’s Activities for Tunisia’s Enabling Environment Reforms
Category
Enabling environment reform
Plans/strategies prepared
Outputs

Etude sur la Participation Privée dans les Infrastructures en
Tunisie et Annexes, June 2003

Workshop on private participation in infrastructure in Tunisia
held in Tunis, December 16–17, 2003
Capacity and awareness building
Workshops/seminars
Category
Enabling environment reform
Policies adopted, legislation
passed/amended, or regulation
issued/revised
Plans/strategies adopted
Outcomes

Loi n° 2008-23 du 1 avril 2008, relative au régime des
concessions

Government agreed to develop and publicize its own Private
Participation in Infrastructure Strategy and Action Plan based
on proposals in PPIAF-funded study, which included
strengthening the autonomy of the telecommunications
regulator, 2005
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Technical Assistance for Tunisia’s Agriculture and Sanitation Sectors
In 1999 the Tunisian Ministry of the Interior and Local Development and the Ministry of Agriculture and
Hydraulic Resources produced a national master plan to replace the country’s 50-plus local
slaughterhouses by eight regional facilities, one for each economic region, including one for the Greater
Sfax metropolitan area. To facilitate the implementation of the national master plan, the seven
municipalities of the metropolitan Sfax area formed an inter-communal syndicate. The government’s
objective was to achieve greater economic efficiency, eliminate environmental and public health hazards,
and reduce the financial burden that city-operated slaughterhouses impose on municipal budgets. To
reach this objective, the government ruled out the operation of the slaughterhouses under direct
municipal management and gave the municipal authorities a broad mandate and incentives to invite
private investors and operators to bid for the concession of specialized income-generating city services,
such as slaughterhouses, under various private sector participation schemes.
The World Bank’s Third Municipal Development Project and Agence Française de Développement
(AFD)’s Projet de Soutien aux Municipalités supported the government’s objectives and addressed a
number of critical economic, financial, social and environmental issues that the Municipality of Sfax and
other main Tunisian cities face. Under this pioneering project, Sfax would be the first large Tunisian
municipality entering into an association with the private sector to operate a slaughterhouse. The four
slaughterhouses (Sfax, Sakiet-Ezzit, Sakiet-Eddayer, and Gremda) owned by, operated by, and located
on the territory of the Municipality of Sfax, would be shut down and replaced by a single state-of-the-art
facility. Private contractors and operators would be invited to bid competitively for the 1) construction on a
turn-key basis and 2) operation of the new facility, with a focus on improving the processing capacity and
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quality of operation (with a particular emphasis on environmental and public health considerations) and
reducing operating costs.
The Municipality of Sfax teamed with the central government and created a company, Abattoirs Unifiés de
Sfax or Society for the Greater Sfax Unified Slaughterhouse (AUS), which would tender for and own the
new slaughterhouse facility. However, due to the magnitude, novelty, and potential risks of the project,
the World Bank and AFD recommended that AUS recruit an international advisor with expertise and a
successful track record in private sector participation and a certain degree of familiarity with
slaughterhouse operations.
Thus PPIAF assistance was requested in 2008 from the municipal government of Sfax and AUS to
successfully integrate the four existing and deficient slaughterhouses into one new facility, operating
under the highest quality standards as part of an effective private sector participation arrangement. In
particular, technical assistance included:



A review and validation of the existing infrastructure development strategies and the technical,
environmental, institutional, legal, and financial studies commissioned by the Municipality of Sfax
and the AUS in connection with the slaughterhouse project, with the purposes of: 1) ensuring a
viable and sound slaughterhouse project; and 2) incorporating the necessary elements, at an
early stage, for private sector participation in the slaughterhouse operation
The provision of procurement advice to the municipal authorities and AUS
Support to AUS regarding the design of the new slaughterhouse facility as a public-private
partnership
The main concrete results were: 1) the bidding document for the specialized firm that will carry out the
detailed design, prepare tender documents for construction and equipment, supervise the project, and
ensure quality certification is complete and has been approved by Tunisia’s National Procurement
Commission—a breakthrough for the Municipality of Sfax as well as for the intercommunalité and
decentralization processes; 2) a preliminary design that calls for a reduced facility that could be expanded
in the future; 3) acknowledgement that the Greater Sfax Unified Slaughterhouse faces two major
constraints to its feasibility: the low tariffs of its services and the inefficient management of personnel; and
4) recognition that the way to ensure that AUS management takes a commercial approach is through a
public-private partnership operation.
The government took ownership of the PPIAF-funded activity and made steps toward implementing the
recommendations of the final report. However, due to the recent political turmoil surrounding the Arab
Spring, the project has been put on hold.
Results of PPIAF’s Activities in Tunisia’s Agriculture and Sanitation Sectors
Category
Enabling environment reform
Outputs

Tunisia Sfax Regional Slaughterhouse Technical Assistance,
which provides an in-depth analysis of public-private
partnership options for the design and management of Tunisia’s
slaughtering and processing facilities, June 2009

Bidding document for the specialized firm that will carry out the
detailed design, prepare tender documents for construction and
equipment, supervise the project, and ensure quality
certification, June 2009

Four-day study tour of two modern French slaughterhouses
operated by municipal governments, April 2009
Plans/strategies prepared
Project cycle-related assistance
Transaction support
Capacity and awareness building
Workshops/seminars
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Category
Outcomes
Capacity and awareness building
Consensus achieved

The government agreed to implement the options in the final
report, June 2009
Technical Assistance for Tunisia’s Transport Sector
Tunisia’s economic development has been largely driven by the opportunities created by links with
Europe. To take advantage of its geographical proximity, Tunisia took early proactive measures and has
successfully developed export-oriented manufacturing industries since the 1970s. As a result, in 2009
Tunisia’s exports contributed to about 60% of its GDP, against one third 20 years prior.
Given its orientation, trade facilitation and logistics is central to Tunisia’s competitiveness strategy.
Exporters are part of production cycles in Europe, which increasingly require just in time delivery,
especially in the largest exporting industries such as automotive or garment. Producers also need to
reduce logistics costs stemming from delays and inefficiencies on their imported inputs or domestic
operations.
These concerns have become increasingly crucial over the last decade, with renewed competition from
Eastern Europe. For Tunisian exporters, excessive trade logistics costs, delays, and inefficiencies are a
recipe for losing market share. It is even more important in the context of the current global economic
downturn, when demand is low, and competitors from more distant locations benefit from lower shipping
prices.
The Tunisian Ministry of Transport and the Ministry of Development sought the World Bank’s assistance
in 2007 to analyze Tunisia’s competitiveness in logistics infrastructure and services and assess traderelated infrastructure, domestic and international services, as well as procedural requirements. The main
conclusion was that the Tunisian performance in terms of infrastructure, service, and procedures was less
than stellar for a country with the level of development and closeness to Europe. Moreover, based on
projections for GDP growth, the volume of logistics flows is expected to double over the coming decade,
thereby putting substantial strains on the existing infrastructure (notably ports and warehousing),
services, and business practices and procedures.
With the help of key government agencies within the Tunisian government, the World Bank prepared a
logistics Action Plan to bring Tunisia’s connection to international markets at the level of the most
advanced countries in this field, such as China or Thailand. One key component of this Action Plan was
to develop a network of logistics zones. The Ministry of Transport thus requested PPIAF assistance in
2009 to establish template bidding documents for a concession contract of these logistics zones and to
tailor them to a test case regarding the development by private investors of a logistic zone at the port of
Radès that can be replicated in other zones. The conceding authority is the Office de la Marine
Marchande et des Ports (OMMP), and this concessioning would be the first case of private investment in
logistics zones in Tunisia.
In addition to the draft bidding documents, the outputs included recommendations on the structure and
key provisions of concession contracts for logistics zones and recommendations on the organization of
the selection of private investors. The government issued a tender in June 2010 but it failed to attract
private investors. The government has since indicated that once the political turmoil in the country
subsides, and should the government still choose to pursue the Radès project in the future, the Ministry of
Transport will finalize the bidding documents addressing the consultants’ and lawyers’ recommendations
on possible reasons for the tender failure. These recommendations are expected to serve as helpful
guidance to the Ministry of Transport and OMMP in the concessioning of logistics zones in the future.
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Results of PPIAF’s Activities in Tunisia’s Transport Sector
Category
Outputs
Project cycle-related assistance

Transaction support

Observations sur le Projet de Dossier d’Appel d’Offres,
December 2010
Dossier d’Appel d’Offres International—La réalisation et
l’exploitation d’une zone d’activités logistiques à Radès, June
2010
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