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  • Tunisia: In Search of Economic Freedom

    Several weeks ago, Tunisia began what has become a trail of protests and uprisings in the Arab world. Tunisia had a number of characteristics that leant it to uprising, including empowered and educated people and few economic prospects for those people. The country needs improved economic freedom.

    Tunisia in recent years has made great strides investing in its human capital—educating its people and providing some basic health care. According to the U.N.’s Human Development Indicators, Tunisia has outpaced the rest of the Arab world over the last three decades. Other experts agree that Tunisia has done a better job than most Arab nations in areas such as education, health, and women’s rights.

    However, its economic improvements have not kept pace. While Tunisia’s economy has been slowly improving, it still denies too many freedoms to its people, and in doing so it is holding back its workforce. Unemployment, one focus of the protests, is officially at 13 percent (25 percent for young people), and an even higher percentage of college graduates are out of work. Additionally, many of the jobs that are available are “menial” and do not make use of the educated population. The country is on course for these numbers to only worsen. Currently about 80,000 graduates enter the job market each year. Only a big boost of economic freedom can provide the dynamism necessary for job creation at that pace.

    Corruption has also been increasing. In The Heritage Foundation’s Index of Economic Freedom, Tunisia’s corruption score declined (meaning corruption increased) over the last year, and some claim that corruption has been rising rapidly for at least the last five years. In the Index, Tunisia scored below the international average in the areas of trade freedom, fiscal freedom, investment freedom, and financial freedom.

    Much public attention has now turned to Egypt, but Tunisia’s story is not yet finished. With so much pent-up, educated talent, the country’s new government would do well to improve economic freedom, fight corruption, and allow the economy to make better use of one of its primary resources: its people.

    Posted in International [slideshow_deploy]

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