Interview: Amine Ben Ayed
What can be done to improve the competitiveness of the Tunisian industrial sector?
AMINE BEN AYED: For industrial companies Tunisia is very competitive in terms of price and quality, but Tunisian companies may not have the right strategy. Ideally, firms would specialise in their domain of activity, which means reinvesting profits in the same business area. Unfortunately, many Tunisian holdings prefer to reinvest their profits in other assets, such as real estate, which is not correct if they want to increase competitiveness. The source of the problem is that many investors feel they need to diversify their portfolio in order to secure their holding, whereas in the industrial sector it is important to reinvest a large part of the profits back into their main activity.
Another major issue is the size of the country and therefore its market size. For any industry there is a critical production threshold, and for many industrial firms the Tunisian market is lower than the minimum production capacity. Thus, it is complex for Tunisian companies to develop. Normally, industrial firms count on their local market to grow, and they face competition. In Tunisia companies are too small to develop, and it is therefore difficult to invest in research and development (R&D) and afford the technologies needed to achieve high competitiveness.
Nevertheless, since the country remains competitive in terms of price and the quality of its labour force, as soon as a Tunisian industrial company has reached a certain size it has many chances to be successful internationally. So if we want to see Tunisian industrial companies being successful internationally, there is a need for them to concentrate their capital in order to grow and become holdings that specialise in a specific field of activity.
In addition, the business environment must be welcoming to international operators if we want to see the local sector improve. Contrary to what is often said, the country must continue to encourage international companies to come, mainly for its affordable workforce. Even if they do not create much added value for the country, it gives the opportunity for engineers to rub shoulders with international companies of high standards.
Does Tunisia’s affordable workforce constitute a source of attraction for foreign companies?
AYED: It is well known globally that one of the first reasons why international companies come to Tunisia is for the low cost of its workforce, but this is not the only asset. Young engineers are creative, which allows companies to file new patents. Technicians and engineers have high levels of knowledge and performance, but they need to be supervised when it comes to R&D because they tend to lack structure and organisation. An important point regarding worker productivity is that it can be improved with higher motivation, which comes together with the right salaries and the right equipment.
How could the education system be better adapted to market needs?
AYED: Today there is a decrease in the level of education in Tunisia, and industrial companies feel it. However, it is always offset through internal training, and there are many programmes and subsidies to encourage training in companies. Many students finish their studies after having joined a company, which is a strategy that provides a high-quality workforce. By incorporating young people earlier, companies are able to identify what is missing in their education.
On the other end, technical education is quite good in Tunisia. There are no problems finding good technicians or engineers, but it is difficult to find qualified people with soft skills, such as high language or presentation skills. Sadly, for many important managerial positions, Tunisians who have studied abroad in Europe or in the US are favoured over other Tunisians.
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