By Roua Khlifi | Apr 30 2013Commodities , Forum for a New Republic , main-economy-featured , main-featured , Subsidies ,
Politicians, civil society representatives and economic experts met Tuesday to discuss reforming policies that govern subsidies on Tunisian goods in an effort to close the country’s budget deficit and improve the economy.
The Tunisian Institute for Strategic Studies, a think tank affiliated with the Tunisian Presidency, organized the conference with the Tunisian Union of Commerce and Handicrafts (UTICA) and the Forum for a New Republic, to explore alternatives to current subsidy policies.
“Subsidy programs are a burden on the state budget. They represent overall about 20 percent of the state budget,” said President Moncef Marzouki, who gave the opening speech at the conference.
Commodities such as basic food products and fuel are subsidized to preserve consumer purchasing power, especially for citizens with low incomes. But inflation and continuing price increases have prompted citizens to complain about the cost of staple goods.
Marzouki called on conference attendees and the Tunisian public to take part in a national dialogue to reach a consensus over current economic issues, especially those related to subsidies.
UTICA President Wided Bouchamaoui reiterated that cutting subsidies is necessary to decrease pressure on the state budget. She also asserted that the distribution of subsidies could be better managed.
“Subsidies do not only go to people who need them; other classes benefit from them as well and they might not need to,” Bouchamaoui said.
Marzouki and Bouchamaoui agreed that transparency in providing relevant and accurate data is important to reforming subsidy policies. They also said that drawing on the experiences of other countries could prove beneficial.
“We didn’t have a revolution to make life harder for the poor and middle classes, but rather to improve their lives and to end poverty,” Marzouki said.
Attendees represented five ministries, including the Ministry of Finance and the Ministry of Industry, but the presentations and speeches did not offer finalized technical solutions. The discussions aimed to gather suggestions and ideas about reforming subsidy policies.
Some of the proposals aimed to increase agricultural production to meet the country’s needs and diminish the need to import certain goods that can be produced in Tunisia. As fuel is one of the primary subsidized goods, it was also suggested that the country could do more to encourage alternative energy sources.
Bouchamaoui emphasized the importance of raising awareness about economic issues among regular citizens, especially young Tunisians, to promote national dialogue.