Averaging about $700m a year in contract awards since 2008, Tunisia is one of the region’s smallest projects markets. But after a surge in activity in 2017 and with about $18.6bn of planned projects, including some major power and transport schemes, Tunisia’s projects market is set for healthy growth.
About $27bn of major projects are planned or underway in Tunisia. Of these, about $8.3bn of projects are under construction, with $18.6bn planned. The construction and power sectors account for about 64.2 per cent of all projects that are planned or underway in Tunisia.
About $6.9bn worth of projects contracts have been awarded in Tunisia since 2008, an average of about $697m of awards a year. The value of annual project contract awards peaked in 2014 at $1.3bn, when it was boosted by the award of the main contracts on the Nawara Gas Field Development: Gas Pipeline & Central Processing Facility (CPF).
The award of several power project packages saw awards reach $1.2bn in 2017.
The 2011 Tunisian Revolution, led to a period of civil unrest and turbulence that saw Tunisia’s projects market sow sharply in 2011 and 2012 as political upheaval led to delays in the commencement and implementation of various projects.
The development of transport, power and residential infrastructure is the primary driver of projects in Tunisia as Tunis seeks to meet the housing, mobility and energy needs of its people.
In order to accelerate the pace of foreign and private sector investment, in September 2016, the government approved the new investment law under which it announced plans to exempt tax for a period of 10 years on profits of major projects.
The Tunisian government introduced a dedicated PPP law in 2015 in order to stimulate the participation of private sector investors and developers in the country’s infrastructure development.
The government is seeking to stabilise Tunisia’s finances through tough fiscal adjustment polices and economic reforms aimed at increasing private sector involvement in the economy.
But with high unemployment, many of the austerity measures and reforms are unpopular. And with 2011 still fresh in the collective memory, Tunis must tread carefully.
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