Tunisia's stability may be illusory.

Tunisia maintains the admiration and goodwill of international financial agencies owing to its favorable macroeconomic record over the past several years.

Typical of comments supporting Tunisia's reputation is the following from a 2007 report from the African Development Bank (ADB). "Tunisia has a stable political environment, with one President since 1987, who is backed by the Rassemblement constitutionnel democratique (RCD). He won a 4th term in 2004 with 89% of the votes cast and enjoys a huge majority in parliament (80% of the 189 seats)."

Immediate suspicion ought to be cast on this type of comment from the huge majorities from both the electoral process and the legislative census. International observers of elections often take such huge majorities as a telltale sign of election fraud.

Stability, however, in the Middle East is an even rarer commodity than untainted elections, so the international financial community does not complain about the heavy handed participation by the government in the country's economy.

The problem is that even though Tunisia can claim macroeconomic progress-the International Monetary Fund (IMF) estimates that Tunisian GDP will grow 6.0 percent in both 2007 and 2008-the county's consumers are not well served by government induced economic inefficiencies.

Economic control by the government, and associated limits on freedom of expression, render an economy vulnerable to economic shocks. Tight control can be managed for only so long.

Tunisia's reform agenda, as reported by the IMF on November 14, 2006, includes suggestions to open the economy further, stimulate private investment, and overhaul the educational system. The IMF also urged Tunisia to stimulate creation of jobs. Many recent graduates are encouraged to emigrate to Europe, particularly France, by high unemployment.

One major reform that impacts consumers directly is the elimination of Tunisia's 29 percent Value Added Tax (VAT). Strong demand followed this move, which increased inflationary pressure.

SUCCESSFUL FAMILY PLANNING HAS IMPROVED TUNISIA'S DEMOGRAPHICS

The population growth rate for Tunisia is well below the regional average, due in part to a birth rate of 17 per thousand inhabitants, which is lower than the average of 26 per thousand for North Africa. Job creation has not kept up with growth of the labor force in recent years, and it is unlikely that the situation will improve further in 2007. Unemployment is running about 10 percent, and this continues to undermine consumer confidence.

Tunisia's population reached 10-million people mid-2006, which amounted to 5.0 percent of North Africa's 198-million inhabitants. According to data released by the Population Reference Bureau (PRB), Tunisia's population will reach 12-million by 2025. Also, according to that source, Tunisia is going to have a population of just over 12-million people in 2050.

The PRB revealed that a substantial 65 percent of Tunisia's population lived in urban areas during 2006, and that the country's population density is a low 43 people per square mile. Tunisia is about 7.0 percent smaller than Uruguay, and Tunisia has three times as many residents. Another source of demographic data, the CIA's World Factbook, indicates that 27 percent of Tunisia's population was birth to 14 years old in 2006, while 66 percent was 15 to 64 years old, and 7 percent of the populace was 65 years of age and over.

CIA statistics revealed that the country's population growth rate was 1.0 percent in 2007. According to the United Nations Population Division, in the year 2050, 20 percent of Tunisia's population will be birth to 14 years old, while 55 percent will be aged 15 to 59, and 25 percent of the populace will be 60 years of age and over.

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