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Remarks at the Opening of the Tunisia Investment Forum


Remarks
Robert D. Hormats
Under Secretary for Economic Growth, Energy, and the Environment 
Tunis, Tunisia
June 14, 2012

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Votre Excellence Monsieur le Ministre Bettaieb, mes collegues confereciers, Mesdame et Messieurs, je vouce remercie pour votre chaleureux accueil. Je suis tres content d’etre pami vous ce soir.

I would like to thank our hosts, the Government of Tunisia and the Foreign Investment Promotion Agency of Tunisia, who have all worked very hard to put this event together.

I also want to acknowledge Ambassador Gordon Gray, who is with us here tonight. We have one of our finest Ambassadors in the world stationed in Tunis. This demonstrates the importance we place on this relationship. And I am delighted, Gordon, to join you here in Tunisia.

We are lucky to have a number of other impressive speakers here tonight, who know Tunisia and Tunisia’s investment environment very well.

I believe I have some special qualifications to speak with you tonight.

When I was a young graduate student, I traveled to Tunisia. I went to Djerba and then to El Djem. And on the way back to Tunis, I traveled by Louage. It was a meaningful experience. One gets to know Tunisia very well by traveling throughout towns and cities by Louage.

I’d like to thank Ambassador Gray for providing a very different kind of transportation during this return trip.

As we all know, Tunisia was the birthplace of the enormous change that has swept the region over the past year. At the heart of the Tunisian revolution was the desire for sustainable and inclusive economic development and, especially, jobs, particularly for young people.

Indeed, the Tunisia Investment Forum one year ago was the first major international economic event in the post-revolution era.

The past year has been challenging for Tunisia. And there is still much work to do. Tunisia faces significant economic challenges, made worse by the state of the global economy. And it is still rolling back decades of prior corruption and other obstacles to private sector growth.

Nonetheless, the United States has great confidence that Tunisia can fulfill its potential as a dynamic economy and a hub for direct foreign investment.

Tunisia has a great history as an international commercial center. The people of Carthage established the dominant civilization in the Mediterranean for several centuries.

Even under Roman rule, this area became known as the Granary of the Empire and, by some estimates, produced one million tons of cereals each year.

So despite being the smallest country in North Africa, the people of Tunisia, from Punic times on, have proven time and again that they are can and will create an international commercial center that is ripe for investment.

The people of Tunisia can, and I believe they will, do it again. Tunisia’s continued progress toward this goal can be energized by a young and vibrant youth, a dynamic business sector, and the reforms being made by the Government to strengthen the economy and energize investment.

Tunisia is fortunate to have two highly precious resources: a population of highly-educated young people and many vibrant businesses.

President Obama said last year, “the greatest untapped resource in the Middle East and North Africa is the talent of its people.”

Over forty percent of Tunisia’s population is under twenty-five. This well-educated population is eager for the opportunities promised by the revolution and ready to make their contribution.

Tunisia also is home to a large population of small and medium-sized businesses, or SMEs. Eighty-three percent of businesses in Tunisia are SMEs. SMEs are key drivers to create jobs and generate local revenue and taxes, here as in the United States.

I want to emphasize particularly the importance of the participation of women in SMEs. Ensuring they have significant opportunity to utilize their talents and energy in this sector, and throughout the economy, will boost overall economic growth in the country.

With these essential ingredients for economic growth, the Government of Tunisia has taken and is planning to take a number of steps to ensure Tunisia is a prime destination for foreign direct investment. And we are delighted that Tunisia is doing so in partnership with the United States.

I had the great honor this morning to meet with the every dynamic and wise leader of Tunisia, His Excellency the Head of Government Hamadi Jebali, who described the important and very positive reforms his government is undertaking. These reforms should boost investment in Tunisia and help create jobs.

In November 2011, we hosted a Tunisia Partnerships Forum in Washington, DC to connect Tunisian entrepreneurs and investors

And just a month ago, I participated in a similar event at the U.S. Chamber of Commerce, and witnessed a constructive discussion among the Tunisian diaspora business communities in the United States, Tunisia companies, and American companies.

The Government of Tunisia, under the leadership of Head of Government Jebali, has laid out an ambitious plan to attract foreign investment. I’d like to highlight just a few of these key steps:

First, the government has budgeted a significant sum for public investment into infrastructure projects.

This is a wise decision for many reasons, in part because of the benefits of upgrading Tunisia’s infrastructure and fulfilling Tunisia’s enormous potential as a true trading hub for the Mediterranean. Many American companies have great experience in this area and should be able to help with these projects.

Second, the government is undertaking a program to reform Tunisia’s investment and tax code with the help of the United States’ Commercial Law Development Program.

U.S. companies in the region have expressed concern about a lack of predictability and transparency in regulatory decision-making. The Tunisian government’s efforts will ensure greater transparency and access for both U.S. and other foreign companies.

Third, Tunisia is on the path toward open governance. Tunisia plans to join the Open Government Partnership next year after qualifying for membership.

Tunisia should be commended for taking the necessary steps for eligibility, including an open budget process, providing access to information, providing disclosures by senior government officials, and promoting citizen participation and engagement in policymaking.

Fourth, Tunisia is adopting many best practices for the treatment of foreign direct investment. The OECD Investment Committee approved Tunisia’s application in March to adhere to the OECD Declaration on International Investment and Multilateral Enterprises.

Adherence will help to ensure favorable treatment of foreign investors, minimizing conflicting requirements, and improving cooperation with other countries on promoting international direct investment.

I’ve been fortunate to experience first-hand the results of these reforms, and believe it is important that they continue. Yesterday, I traveled to Bizerte. I met with a number of business people and entrepreneurs.

They have had a difficult year. However, like many business people in Tunisia, they are benefitting from reforms and several are flourishing. As a result, they are growing their businesses. They are creating new jobs.

In other words they now have the opportunities that Mohamed Bouazizi was denied.

I also have met with American companies that have invested in Tunisia and have very positive stories to tell about their experiences. We encourage other American companies to talk to them and to learn from them.

Because of the Tunisian Government’s demonstrated commitment to these efforts, the United States is a strong champion of Tunisia as a country with the potential to grow and succeed as a dynamic, job-creating economy, and as an important destination for foreign direct investment.

And we have demonstrated our belief in Tunisia’s potential. I will give you a few recent examples.

The United States is helping stabilize the Tunisian economy by extending a guarantee that will enable the central bank to issue bonds worth several hundred million dollars to international investors. Our two governments signed a bilateral agreement on this guarantee operation just last week in Washington.

The United States provided a $100 million cash transfer to the Government of Tunisia for near-term debt relief. This allowed the Government of Tunisia to use money otherwise intended for debt payments abroad for its priority domestic programs, accelerating economic growth and job creation.

The U.S. government is also keen on promoting small and medium-sized enterprise development through the use of Enterprise Funds.

As chair of the Group of Eight this year, we are working with our partners, regional countries, and international financial institutions to promote better economic governance.

We have done this because of our friendship and partnership with Tunisia, but also because we hope others who share this view will invest in Tunisia’s future.

The date of this forum is auspicious for us. For the U.S. State Department, today is Global Economic Statecraft Day. Today the Secretary and each of our Embassies are holding events to highlight America’s commitment to putting economics at the center of our foreign policy.

The transitions in Tunisia and the rest of the Middle East and North Africa region, are shaping our world. Increasingly, political transitions hinge on global economic progress, just as economic progress depends on good political reform. Sound economic policies and programs in Washington, Tunis, and other capitals must play a central role in shaping our choices and responses.

Our partnership with Tunisia is an excellent example of our commitment to this approach. We are using our available economic and diplomatic tools to help Tunisia’s challenges and unlock the flow of investment to and trade with Tunisia. We look to other governments and companies throughout the world to make similar connections, not just because it is good for Tunisia, but also because in an interdependent world it is good for them as well

Our support includes the bilateral and multilateral support I mentioned earlier. But it also means looking for ways that the U.S. private sector can play a key role in Tunisia’s transition and economic development.

And this is why so many of our companies have come here to talk to Tunisian companies and government officials. I am confident that they will see great opportunities and that they also can provide ideas and suggestions that will help Tunisian companies to identify and develop partnerships with American companies and close trade relations as well.

I look forward to hearing from the rest of the speakers as we discuss the opportunities and challenges facing Tunisia. For our part, Tunisia can count on a continued partnership with our Embassy, President Obama, Secretary Clinton, myself and other leaders and officials in Washington. We share a deep friendship with the Tunisian people, great respect for its leaders, confidence in its reform process, and an optimism about its future.

Thank you.



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