With perception indexes which are well below the average, corruption (31.4/100), followed by the political climate (31.8/100), bank funding (32.2/100) and social climate (32.8/100), represent the main obstacles for business development in 2022. 'These outcomes do not apply to this year only but they date back to 2018 during which these areas constitute the 4 main challenges to the business climate', reads a survey on the business climate and the competitiveness of companies published recently by the Tunisian Institute of Competitiveness and Quantitative Studies (French: ITCEQ). This 22nd edition was carried out between June 17 and July 22, 2022, on a sample of 1,041 private, structured companies (employing 6 or more employees), operating in industry and in services and distributed throughout the Tunisian territory. The outcomes of this 22nd survey reveal that business leaders have an increasingly negative perception of corruption in the institutional sector, with 70% considering it a major challenge. //Corruption, a major constraint According to the survey, corruption is more denounced by small businesses than by others. The analysis based on company size shows that corruption weighs much more on small companies (72%) than on medium and large ones (61 and 63% respectively). The complexity of administrative procedures and their burden are behind widespread corruption, the authors said, adding that fighting this phenomenon would become more effective with the promotion of digitization of administrative services likely to reduce bureaucracy and minimize direct interaction between the user and the public official. Tunisia has seen the probability of requesting bribes from the private sector increase by 4 points, from 413 in 2021 to 45 in 2022, thus placing Tunisia in 76th position, against 68th in 2021. Yet, digitisation must be accompanied by institutional reforms so as to increase transparency and interoperability, promote accountability and consolidate the dissuasive policy, the authors of the survey underlined. Companies should also introduce codes of conduct and raise their employees' awareness about business ethics in a bid to change behaviour and prevent corruption. // Instability of political climate, among reasons for investors' reluctance// Companies are not able to have a clear vision to launch investment projects. Surveys show that 63% of companies have not invested since 2020, 63% due to the absence of a clear long-term economic vision and more than half (53%) refer to political instability. //Bank funding, a persistent structural challenge// Tunisia's bank funding index continues its downward trend to reach 32.2 /100 in 2022, recording a decline of 6.4 points compared to 2020, the same source said. Concerning access to funding, 54% of Tunisian companies polled in 2022 are suffering from the repercussions, compared to 50% in 2020. Even large companies are increasingly complaining about access to credit. For these companies, the cost of bank funding is too restrictive, while 78% of them claim that this cost is considered a major obstacle in 2022 compared to 74% in 2020. "The challenge of accessing financing is more difficult in Tunisia than in any country in the MENA region," the survey adds. They call for the adoption of financial reforms capable of reducing credit rationing, in particular through the development of the activity of private credit bureaus, the reform of the guarantee system, and the promotion of alternative methods of financing such as investment capital and crowdfunding. //Corporate climate, 4th constraint// The social climate index continues its downward trend to settle at 32.8/100 in 2022, the survey indicates =. This area, therefore, ranks as the 4th most severe constraint on the business climate. Social protests are considered by almost 2/3 of Tunisian business leaders as a major challenge to their business. Its acuteness is much more felt by big companies (71%) than by small and medium-sized companies. This instability in the social situation in the country is considered all the more harmful as the strikes staged in the 2021 financial year were behind the disruption of the supply chain for 38% of the companies concerned. The survey shows that in terms of size, this rate rises to 52% for big companies.

Source: Agence Tunis Afrique Presse