Tunisia’s removal from EU financial blacklist should help boost economy

Three years after being designated as a high-risk country with strategic anti-money laundering and counterterrorist financing deficiencies, Tunisia is officially off the list and getting ready for foreign investments.

al-monitor Tourists ride on a horse cart near a closed currency exchange office in Hammamet, Tunisia, March 12, 2020.  Photo by REUTERS/Zoubeir Souissi.

Jun 22, 2020

TUNIS, Tunisia — The European Commission informed the Tunisian Embassy in Brussels June 9 of Tunisia’s official withdrawal from the list of countries with nonefficient anti-money laundering and counterterrorist financing (AML-/CFT) measures, along with other countries including Bosnia and Herzegovina, Ethiopia, Guyana, the Lao People's Democratic Republic and Sri Lanka.

The move comes three years after Tunisia was included on the list, on Feb. 7, 2017, when the country was grappling with a serious economic crisis due to money laundering crimes and high rates of corruption in major state institutions and sectors including customs. This is not to mention tax evasion and e-crimes, as well as hacking of financial accounts and bank cards abroad.

On May 7, the European Commission reviewed the list of high-risk countries, stating that Tunisia’s withdrawal from the list is subject to better application of the recommendations by the European Union (EU) at the level of corruption control, money laundering and terrorism.

The Tunisian Committee of Financial Analysis affiliated with the Central Bank of Tunisia said the decision to remove Tunisia from the list will take effect within 21 days of its publication in the EU Official Journal.

The designation of Tunisia as a country with strategic AML/CFT deficiencies back in 2017 prompted the Tunisian government to launch a campaign to combat corruption.

On May 24, 2017, several businessmen, customs agents and smugglers were arrested, as per the emergency law, on charges of corruption. Tunisian businessman Shafiq al-Jaraya was among the arrested.

During 2018, the Tunisian government worked on reviewing several of its legislations, namely the Anti-Terrorism and Money Laundering Law of 2015, which was amended on Jan. 10, 2018, to be in line with European standards. The Tunisian parliament also approved a law on the national register of institutions on July 27, 2018, and activated the National Counterterrorism Commission.

Sadok Jebnoun, an independent economic analyst and strategist, told Al-Monitor that Tunisia’s withdrawal from the list of high-risk countries would dispel European investors’ fears from investing in the country, especially in light of the anticipated economic crisis as a result of the coronavirus pandemic.

“Attracting foreign investments requires reduced fiscal pressure on companies and a halt in the continuous increase of interest rates,” he said.

Jebnoun also stressed the need to resolve political differences in order to promote a stable democracy that would send positive messages to investors in terms of overcoming the complex situation of the Tunisian economy.

Hussein Dimassi, former finance minister and economic expert, told Al-Monitor that the European decision on Tunisia is a positive one, which would remove several obstacles on the road of foreign investments for the country.

However, he warned that Tunisia might make new mistakes, stressing the “need to learn from the lessons of the past, especially when it comes to fighting against corruption and money laundering.”

Dimassi accused some of the ruling political parties of advancing their partisan interests over the national and economic interest of Tunisia.

Ali al-Areed, vice president of the Ennahda Movement, which has the majority of seats in parliament with 54 out of 217, said that the removal of Tunisia from the list would give more credibility to the Tunisian government that showed commitment to international obligations, combatting terrorism and money laundering. He added that this would improve Tunisia’s economic image among investors and major economic stakeholders.

Badr al-Din Qamoudi, member of parliament for the People's Movement (14 seats), told Al-Monitor that after the decision Tunisia is looking forward to a new economic stage, with more foreign investors and improvement of the position of the Tunisian dinar.

“The EU decision was just and fair to the measures taken by the Tunisian government,” he said, stressing that the government has a real chance to restore the economic situation to normal.

Tunisia has been grappling with an economic crisis since the outbreak of the Jan. 14, 2011, revolution that toppled former President Zine El Abidine Ben Ali. The bad economic situation, as well as terrorist attacks, have dealt a heavy blow to the tourism sector that is vital to the country — which was negatively reflected on the value of the dinar. In 2010, the Tunisian dinar was estimated at $1.42, but is trading now at 2.83 to the dollar.

Mustafa bin Ahmed, member of parliament for the Long Live Tunisia Party (14 seats), described the EU decision as a strong step for Tunisia. In a statement to Al-Monitor, he called on the government to continue the implementation of all legal requirements in the fight against terrorism and money launders, and to take the necessary measures on the ground to safeguard the country and avoid any future sanctions.

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