Around the Region: Tunisia Develops Projects for International Investors; Future of Libya Still Tenuous; Algeria Faces Uncertainty if Replacing President Bouteflika – Jean R. AbiNader

Jean R. AbiNader
October 15, 2018

Jean R. AbiNader, Moroccan American Center

The International Finance Corporation (IFC) recently held a major event promoting investments in a range of projects in Tunisia with two goals: to attract the international community to public-private sector partnerships (PPPs) that combine government assurances with much-needed inputs of technology and resources, and enabling Tunisian companies to play a more important role in the region’s economy.

As explained by Georges Joseph Ghorra, the IFC Representative in Tunisia, “The IFC has this dual purpose. We can make commitments in the framework of these structuring projects and we have at the same time played a role of support and accompaniment of the Tunisian State in this process. We have also used a specialized firm to assist the various ministries concerned in the identification of projects and the preparation of detailed data sheets for each of them, according to their progress.”

The IFC brings a dual perspective to its project support, balancing a concern for the social impact of the projects as well as their economic and financial viability and geographical distribution. As Mr. Ghorra noted, “We have indeed insisted that the projects are distributed throughout the Tunisian territory, including in areas that are relatively disadvantaged. We must ensure that these major projects benefit all populations and not remain concentrated at the level of the capital, as was the case previously. Major PPP projects must be equitably distributed throughout the territory.”

Currently, Tunisia is recovering from a long spell of economic malaise, driven by tourism and export earnings. The bulk of the exports are agri-food products, which employ a significant portion of the workforce and help stabilize the economy. As perceptions of stability grow, so will the tourism sector, making security a key action item for the government.

Ghorra also made a cautionary note that “Everyone agrees that the budget deficit in Tunisia had reached dangerous levels and that the situation required taking steps to redress the situation. Now, what the World Bank thinks is that the most vulnerable populations must continue to benefit from public support, but in a targeted way. It is incomprehensible that a subsidy benefits all segments of the population, even the wealthiest of them. The social support of the state must be directly assigned to those who really need it.”

On the security front in Tunisia, recently released documents point to a small but increasing US military involvement in counterterrorism efforts in the west of the country. As an article in National Interest explained, “Since its 2010 revolution, Tunisia has carried a burden of expectations as a regional model for democracy, challenged with building political consensus, a staggering economy, a population yearning for progress, and rising security challenges . In this context, the United States has sought to sustain Tunisia’s shaky democratic transition primarily by shoring up its military, which received steadily increasing security assistance from 2014 to 2017. Tunisia now receives more U.S. defense aid than any other country in North Africa and the Sahel region, except for Egypt.”

Libya continues its dangerous lurching on an unclear path to an uncertain future. As we noted previously, the call by France for elections in December has been ill-conceived given the fragmentation of power and inability of political elites to agree on a national framework for reconciliation and reconstruction. “On the one hand, despite being sporadic, conflict is ever-present and risks of escalation are pervasive in an increasingly fragmented landscape. Internally, none of Libya’s rival factions has the elements allowing it to enhance social cohesion and prevent total disintegration. At the same time, there is a lack of incentives for Libya’s factionalized political elite to spearhead a political reform process, which has translated into deadlock.”

Although the remit of UN Secretary General’s Special Representative Ghassan Salamé has been reinforced with the appointment ofStephanie T. Williams of the United States as Deputy Special Representative for Political Affairs in Libya, United Nations Support Mission in Libya (UNSMIL), no new initiatives have been announced as election prospects fade. With multiple forces pushing Libya towards greater fragmentation, it is difficult to see how, aside from the National Oil Company, the country will develop a coherent leadership anytime soon.

Algeria meanwhile has its own leadership saga, and no reliable crystal ball is available. While it is common for some to call for a generational change, the reality is that “Depressed oil prices, the demands of a growing youth population, and the insecurity in neighboring countries like Libya and those of the Sahel all pose serious challenges to the Algerian government. And while the regime has shown a capacity to manage these crises in a controlled manner, the key issue in the coming years will be the transition of power should President Bouteflika pass away or leave office unexpectedly,” according to a post on Diwan.

While it has been noted in the past that the army and security services have a key role in the determination of presidential succession, a more nuanced view emerges when looking at Algeria’s overwhelming priority on stability. As the post notes, “These dynamics of power-sharing are just as clear in the Bouteflika period as in previous eras. The alliance between the president, who represents the Tlemcen clan, and the military chief of staff Gaïd Salah, who hails from the Eastern clan, has created a pyramidal power structure, in which the interests of the military, the presidency, and members of the political elite are intertwined in decision making.”

It appears that a key criterion for president remains having been active in the war for independence. As this generation has few members left with the capacity to manage the office, it is unclear as to what forces have the final nod over who will follow Bouteflika. It has long been thought that the military and security heads were the major players, but with the recent government restructuring of the security services and regional governors, it is difficult to make that claim without reservations.

The post comments that “The Algerian political establishment will ultimately have to find a new dynamic stable enough to replace the stability provided by participation in Algeria’s fight for independence, or else face the country’s other challenges without the political stability that has so far characterized Algeria.”

A different perspective was provided in an article in Morocco World News that calls the most recent shake-up a coup by General Gaid Salah, Vice Minister of Defense, “with the firing of all but one head of the country’s military regions, the head of the national police, several generals and high-ranking officials within Military Intelligence.” Interestingly, his moves were said to also marginalize the president’s brother, Said, who has been seen as acting as a shadow president in his brother’s incapacity.

While these moves have definitely strengthened Salah’s paramount position, this by no means reduces the other challenges to the country’s stability including an underperforming economy, restless and marginalized youth, continued terrorist threats on the borders, and emerging political elites tied to the private sector.

A contrarian perspective was provided by Middle East Eye in an article that challenged the usual view of the Algerian People’s National Army (ANP) as motivated by political instincts. It quotes a current defense official saying that “The recent changes at the head of the nation’s army “are part of an ongoing process of the transformation of the ANP into a professional army, an army under the authority of a single leader, the president, and not a would-be conglomerate of powerful senior commanders,” adding that attempts to link these changes to the current political landscape “don’t hold water.” He believes that the army and security services are more focused on consolidating the country’s stability rather than the mechanics of politics.

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