This house believes that Tunisia should not rely on tourism for economic growth

Tunisia is well known for its numerous tourist attractions and its holiday destinations on its coastline. In 2010, the tourism industry brought in a revenue of £1.18 billion (3.2 billion dinar)1. The industry employed 450,000 people directly and 2 million indirectly2.  The beach holiday resorts are popular with Europeans due to the high temperatures, high quality of hotels and, unlike many other Muslim countries, the availability of alcohol. The remains of the ancient city of Carthage, excavated in the mid nineteenth century, have attracted those interested in history and classical studies.  The Saharan desert has also proved to be a popular tourist destination; the set of the fictional planet of Tatooine from the Star Wars films is a famous attraction.

The leisure industry suffered in 2011 when the Jasmine revolution swept President for life Ben Ali from power. Tourism decreased from £1.18 billion to £814 million (2.2 billion dinar) in 2011 due to the perceived instability in the new transitional environment2. While there has been an increase in revenue since the revolution, the event has prompted a discussion on whether Tunisia should rely on their tourism anymore. Post revolution Tunisia has been focussed on using this sector for economic recovery. Tunisian minister Jamal Gamra has been quoted as saying that ‘the importance of tourism-and investment in tourism- to the economy cannot be understated’3. This debate is focussed on whether relying upon tourism for future economic growth is viable or not. 

1)      African Manager, ‘Tunisia-Tourism: Clear Improvement, but a timid pace!’, data accessed 24 January 2014

2)      ETN, ‘Tunisia’s tourism picking up after post-revolutionary slump’ 13 August 2013

3)      Padmore,R. ‘Tunisia tourism industry looks to rebuild’, BBC, 22nd August 2013

Title 
Vulnerable to unrest
Point 

Relying on tourism ensures that the economy is at the mercy of unrest. The violence and break down in law and order following the Tunisian revolution resulted in a notable decrease in tourists as tourists were unwilling to visit an area which they view as dangerous. This is demonstrated by the footfall of tourists which declined from 6,487,000 in 2010 to 4,456,000 in 2011 1. The increase in attacks by Salafists, a conservative sect of Islam which promotes Sharia law and has attacked tourist destinations, has dissuaded many potential visitors2. This has been exacerbated by government travel information which generally advises against visiting regions during periods of unrest, especially for Westerners who are perceived as profitable targets for ransom3. The resultant decrease in tourists reduces revenue, making tourism an unreliable industry for Tunisia.

1)      African Manager, ‘Tunisia-Tourism: Clear Improvement, but a timid pace!’, data accessed 24 January 2014

2)      Whewell,T. ‘Justice kiosk: Tunisia’s alternative law enforces’, BBC, 30 July 2013

3)      Department of Foreign Affairs and Trade ‘Kidnapping threat worldwide’

Counterpoint 

The long term affects that instability have on industries such as tourism is overstated. Since the Tunisian revolution, there has been a continued effort by Salafists to attack tourist destinations. However, tourism has recovered from the low point of 2011. In the first ten months of 2013 Tunisia attracted 5.5 million tourists, increasing by 5.7% over 20121. The continued growth of the sector demonstrates that the impact which instability has is exaggerated. Besides instability would equally affect other industries; closing factories, damaging perceptions of an ability to complete orders etc.

1) Reuters, ‘Tunisia tourism up by 5.7 pct in first 10-months of 2013’

Title 
Profit margins are too small
Point 

A major problem for Tunisia’s tourism sector is the small profit margin. The industry’s main targets are European, middle class income visitors on package holidays to sea-side resorts. This has resulted in a low per-capita spending rate as food, drink and travel are all usually included in sea-side holiday resorts. Average per-capita spending for tourists in Tunisia amounted to around $385 in 2012 which is low when compared to Egypt’s $890 and Greece’s $10001. This reliance on a low-profit niche in the tourism industry is a systematic flaw which will not provide the economic growth which the country needs.

1)      Achy,L. ‘The Tourism Crisis in Tunisia Goes Beyond Security Issues’, Al Monitor, 26 June 2012

Counterpoint 

Even an all inclusive package holiday benefits the economy through buying local products and hiring staff locally. To get beyond the lower end of the market Tunisia is diversifying its tourism for more profitable gains through cultural activities which can be charged separately to board and lodging.

Cultural tourism equates to around 37% of worldwide tourism1 and Tunisia is beginning to further embrace this aspect. The set of the fictional planet of Tatooine from the Star Wars films is a popular destination for tourists, although this is now threatened by sand dunes2. There are other notable locations which are not threatened however. The ancient city of Carthage, excavated in the mid-19th century, the world heritage site of Kairouan, and the Saharan desert are prominent destinations for cultural tourism. The growth of this sub-sector could incur more profitable gains.

Title 
Overseas competition
Point 

Tunisia’s tourism industry is at risk from overseas competition. International tourism is a very competitive market, relying on the industry is therefore an illogical policy. Tunisia is already being undercut on prices by other countries despite its low fees. Morocco, Spain and Turkey can afford to charge a lower price for package tours than Tunisia due to better air transportation links1. Even before the Jasmine revolution, Tunisia was starting to lose ground to these countries. The ten years before the removal of Ben Ali saw the number of tourists to Tunisia rise from five to seven million, whilst Morocco rose from five to nine million2.  Outside of the Mediterranean, Tunisia must compete with popular tourist destinations such as the Far East, North America and Australasia.

1)      African Manager, ‘Tunisia-Tourism: Clear Improvement, but a timid pace!’, data accessed 24 January 2014

2)      Achy,L. ‘The Tourism Crisis in Tunisia Goes Beyond Security Issues’, Al Monitor, 26 June 2012

Counterpoint 

The majority of modern economic industries have to face overseas competition. Tunisia, like its North African neighbours, was convinced in the 1990s to emplace neo-liberal reforms in return for increased lending from the World Bank and other lenders. These reforms, based on the free market principles, ensured that protectionism ended and domestic industries had to compete against other international actors. Sectors such as agriculture have become increasingly threatened by overseas competition since the 1990s1. The disparity between rich and poor created by the reforms has been listed as one of the major factors for the Jasmine revolution2.

1)      Aoun,A. ‘The Performance of Tunisian Agriculture: An Economic Appraisal’, New Medit, vol.3 no.2, 2004 pg.5

2)    Nazemroaya,M. ‘Dictatorship, and Neo-Liberalism: The Tunisian People’s Uprising’, 19 January 2011

Title 
Tourism causes pollution
Point 

The tourism industry in Tunisia results in notable damage to the environment. Without sustainability, economic growth will only last in the short term. This is especially pertinent for tourism, where environmental beauty is of particular importance. From the construction of infrastructure and travel, to the general waste produced, tourism is problematic in the sense that it can often cause pollution; which in turn damages the country’s reputation1. Most tourists to the region are from Europe, although there are an increasing number of Russians which means travel becomes a major source of pollution. A return journey via plane from London to Tunis creates around 310 kg of CO2 (standard passenger jets create around 0.17kg of CO2 per km) 2. This is disproportionately damaging compared to other vehicles, but is the most practical way of reaching Tunisia. Other impacts such as overuse of water, land degradation and littering can all cause problems as well3.

1)      United Nations Environment Programme ‘Environmental Impacts’ data accessed 28 January 2014

2)      BBC, ‘Pollution warning on holiday flights’, 1 May 2000

3)      United Nations Environment Programme ‘Tourism’s Three Main Impact Areas’   data accessed 28 January 2014

Counterpoint 

Environmental damage caused by alternative sectors is far worse. Pollution in the industrial sector has become much more evident since the removal of Ben Ali’s regime. 13,000 tonnes of industrial pollution are released from the Gulf of Gabes every year, causing high rates of infertility, miscarriages and deaths1. This is a common theme amongst Tunisia’s industrial areas and is far more destructive than tourist activities.

1) Addala,R. & McNeil, ‘Pollution in Gabes, Tunisia’s shore of death’, Al-Jazeera, 14 June 2013  

Title 
Produces Employment
Point 

Tourism is the second largest employer in the country. The industry produces over 400,000 jobs for Tunisians1. This employment figure is vital to Tunisia which has a large number of students in higher-education, around 346,000 in 2010, and a consequentially high expectation of employment2.  Tourism also has a positive effect on other linked industries such as transport, creating jobs in these sectors as well.  This creation of employment allows more people to sufficiently contribute to society through taxes and the purchasing of goods through their wages. This, in turn, produces economic growth and should therefore be encouraged.

1)      Padmore,R. ‘Tunisia tourism industry looks to rebuild’, BBC, 22nd August 2013

2)      Global Edge, ‘Tunisia: Economy’, data accessed 27 January 2014

Counterpoint 

While the sector does provide employment, there is a regional and gender disparity. The number of women employed by the generally female friendly industry is below the national average. Only 22.5% of those employed in tourism are female, while the national average is 25.6%1, demonstrating a clear under-representation.  Regional disparity also exists between coastal and inland regions. Years of coastal-focused economic growth has resulted in an underdeveloped interior region with few jobs in the tourism sector2.

1)      Kärkkäinen,O. ‘Women and work in Tunisia’, European Training Foundation, November 2010

2)      Joyce,R. ‘The Regional Inequality Behind Tunisia’s Revolution’, Atlantic Council, 17 December 2013

Title 
Investment
Point 

Tourism should be relied upon for economic growth as it attracts significant foreign investment. Tourism is the largest form of foreign currency income, with around £728 million being produced by external visitors in 20121. Attracting Europeans, who have relatively large disposable incomes, has been a prominent tactic of the industry with favourable results. It is estimated that Europeans account for 95% of all overnight stays in Tunisia2. The other major sectors of services and agriculture do not inspire foreign investment of this magnitude.

1)      Khalifa,A. ‘Foreign direct investment and tourism receipts pick back up in Tunisia’, Global Arab Network, 7 October 2012

2)  Choyakh,H. ‘Modelling Tourism Demand in Tunisia Using Cointegration and Error Correction Models’ pg.71

Counterpoint 

The prominence of foreign investment in tourism has decreased since Ben Ali’s fall. Prior to the Jasmine revolution, financial actors who were close to the ruling regime were encouraged to invest and given a privileged position. Once the regime was removed, so were the favourable conditions1. Reliance on Europe for tourists, and the foreign investment that accompanies them, has also proven to be unwise. Since the 2008 economic crisis, many potential European tourists have been out of work, or have reduced disposable incomes at the very least, which has decreased the flow of tourists and financial investment2.

1)      Achy,L. ‘The Tourism Crisis in Tunisia Goes Beyond Security Issues’, Al Monitor, 26 June 2012

2)   Padmore,R. ‘Tunisia tourism industry looks to rebuild’ , BBC, 22nd August 2013

Title 
Other industries are less reliable
Point 

Other sectors, such as agriculture and the industrial sectors, have proven to be unreliable as well. Tunisia’s agriculture sector is the largest employer in the country and has received significant investment since the 1980s. Despite this, the sector performed poorly between 1985-2000 and was costly to the Tunisian economy; ensuring low returns and importation of food to meet domestic demand1. The industrial sector also demonstrated itself to be vulnerable in the 2008 economic recession. In addition, the low value of produced goods creates little opportunity for lucrative profits2. The flaws of these sectors make them unviable as alternatives to tourism. 

1)      Aoun,A. ‘The Performance of Tunisian Agriculture: An Economic Appraisal’ pg.7

2)      Elj,M. ‘Innovation in Tunisia: Empirical Analysis for Industrial Sector’ 2012

Counterpoint 

The potential for growth within other sectors of Tunisia’s economy is far greater than that of tourism, if invested in properly. The energy sector has been highlighted as a potential avenue for development, as energy efficiency projects would provide employment and a lower cost of production in the industrial sector1.  At present, the industrial sector’s low profits are the product of high-energy costs due to energy imports. Sustainable energy production in Tunisia through projects such as solar panels would help increase profit margins.

Research and development in industry and agriculture also has the potential to increase profits and employment. At present there are few private R&D departments in comparison to those in the public sector, but it provides another avenue for greater technical efficiency in other areas which could then create a higher revenue2.

1)      World Bank, ‘Energy Efficiency in Tunisia: Promoting Industry While Protecting the Environment’, 23 May 2013

2)      Aoun,A. ‘The Performance of Tunisian Agriculture: An Economic Appraisal’ pg.7

Bibliography 

Achy,L. ‘The Tourism Crisis in Tunisia Goes Beyond Security Issues’, Al Monitor, 26 June 2012 http://www.al-monitor.com/pulse/business/2012/06/the-tourism-crisis-in-tunisia-is.html#

African Manager, ‘Tunisia-Tourism: Clear Improvement, but a timid pace!’, data accessed 24 January 2014  http://www.africanmanager.com/site_eng/detail_article.php?art_id=19466

Aoun,A. ‘The Performance of Tunisian Agriculture: An Economic Appraisal’, New Medit, vol.3 no.2, 2004, pg.4-7 http://www.iamb.it/share/img_new_medit_articoli/130_04aoun.pdf

Barnett,E. ‘Star Wars: Visit Tatooine, before it’s swallowed by the Sahara’, CNN, 18 October 2013 http://edition.cnn.com/2013/10/18/travel/star-wars-visit-taooine-sahara/

Choyakh,H. ‘Modelling Tourism Demand in Tunisia Using Cointegration and Error Correction Models’, in Advances in Tourism Economics by Matias,A., Nijkamp,P., Sarmento,M. (eds.) Heidelberg: Physica-Verlag  2009 pgs.71-85

Department of Foreign Affairs and Trade ‘Kidnapping threat worldwide’, Australian Government, data accessed 24 January 2014 http://www.smartraveller.gov.au/zw-cgi/view/TravelBulletins/Kidnapping

Elj,M. ‘Innovation in Tunisia: Empirical Analysis for Industrial Sector’, Journal of Innovation Economics, no.9, 2012 pgs.183-197 http://www.cairn.info/revue-journal-of-innovation-economics-2012-1-page-183.htm

ETN, ‘Tunisia’s tourism picking up after post-revolutionary slump’ 13 August 2013 http://www.eturbonews.com/37007/tunisias-tourism-picking-after-post-revolutionary-slump

Global Edge, ‘Tunisia: Economy’, data accessed 27 January 2014 http://globaledge.msu.edu/countries/tunisia/economy

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Joyce,R. ‘The Regional Inequality Behind Tunisia’s Revolution’, Atlantic Council, 17 December 2013 http://www.atlanticcouncil.org/blogs/menasource/the-regional-inequality-behind-tunisia-s-revolution

Kärkkäinen,O. ‘Women and work in Tunisia’, European Training Foundation, November 2010 http://www.etf.europa.eu/webatt.nsf/0/300DDD6D021DB90FC125797C0040FD1C/$file/Women%20&%20work_Tunisia_EN.pdf

Khalifa,A. ‘Foreign direct investment and tourism receipts pick back up in Tunisia’, Global Arab Network, 7 October 2012 http://www.english.globalarabnetwork.com/2012100712625/Economics/foreign-direct-investment-and-tourism-receipts-pick-back-up-in-tunisia.html

Nazemroaya,M. ‘Dictatorship, and Neo-Liberalism: The Tunisian People’s Uprising’, Global Research, 19 January 2011 http://www.globalresearch.ca/dictatorship-and-neo-liberalism-the-tunisian-people-s-uprising/22850

Padmore,R. ‘Tunisia tourism industry looks to rebuild’, BBC, 22nd August 2013 http://www.bbc.co.uk/news/business-23322100

Reuters, ‘Tunisia tourism up by 5.7 pct in first 10-months of 2013’, 12 November 2013 http://za.news.yahoo.com/tunisia-tourism-5-7-pct-first-10-mnths-114034743--business.html

Thorne,S. ‘Cultural Tourism: A Place-Based Approach’, Creative City Conference 2009, http://www.destinationworld.info/downloads/Cultural%20Tourism%20-%20A%20Place-Based%20Approach.pdf

Whewell,T. ‘Justice kiosk: Tunisia’s alternative law enforces’, BBC, 30 July 2013 http://www.bbc.co.uk/news/magazine-23469218

World Bank, ‘Energy Efficiency in Tunisia: Promoting Industry While Protecting the Environment’, 23 May 2013 http://www.worldbank.org/en/results/2013/05/23/energy-efficiency-in-tunisia-promoting-industry-while-protecting-the-environment

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