Tunisia's Twin Democracy and Economic Crises Push it to the Brink
Tunisia experts examine recent events and discuss what we might expect to see in the weeks to come.
Last July, Tunisian President Kais Saied suspended parliament in what many observers called a bloodless coup. Saied’s supporters — of which there are many — claim that this extreme executive action was necessary to root out rampant government corruption and ineffectiveness. Polling at the time showed widespread dissatisfaction with the performance of parliament and the prime minister; many Tunisians felt that their high expectations following the 2011 popular revolution were not realized and that the country was heading in the wrong direction.
Following the suspension of parliament, Saied further enhanced his own power, dissolving the country’s High Judicial Council and bringing the election commission under his control, both by presidential decree. In December, Saied announced that a referendum would take place on July 25 to adopt or reject constitutional amendments. The proposed constitutional amendments were just released late Thursday evening and the drafting process has been criticized for its lack of inclusiveness and transparency. Last month, Saied dismissed 57 judges sparking international condemnation. Calls by world leaders to Saied to walk the country back from its slide toward authoritarianism have gone unheeded.
Meanwhile, Tunisia faces a dire economic predicament. Public sector spending (largely due to pensions, salaries and government subsidies) consumes the state’s budget. According to the World Bank, public debt as of 2020 was 70 percent above GDP, current debt levels could be much higher. In the absence of a robust and well-regulated private sector Tunisians have long relied on the state as a provider of jobs and subsidized goods and services, creating an unsustainable economic imbalance. Previous governments have been reluctant to address public sector spending, fearing it could prompt widespread protests led by the country’s powerful Tunisian General Labor Union (UGTT) and disrupt Tunisia’s fragile economy. Historically, the UGTT has refused to support economic reforms advocated by the IMF and World Bank despite the country’s worsening financial situation.
As the Tunisian economy continues to deteriorate, a potential IMF-World Bank package is under discussion. Earlier this month, the UGTT initiated a nationwide strike in protest over proposed cuts to government subsidies and public sector spending. The strikes represent the first real direct test for Saied who has faced very little domestic opposition to his rule by decree. Some have questioned whether Saied has a viable economic plan to save the country from financial disaster. However, it’s possible that the future of Saied’s administration depends on securing a new IMF-World Bank loan.
Prior to last week's release of the proposed constitutional reforms, USIP’s Tom Hill discussed all this with several noted Tunisia experts: Sarah Yerkes, a senior fellow at the Carnegie Endowment for International Peace; Sharan Grewal, a non-resident fellow at the Brookings Institution and assistant professor at The College of William and Mary; Mohammad Dawood Sofi, a postdoctoral research fellow at Ankara Yıldırım Beyazıt Üniversitesi; Mohamed-Dhia Hammami, a Ph.D. student at the Maxwell School of Citizenship and Public Affairs at Syracuse University; Nate Grubman, a teaching fellow at Stanford University; and, Mariam Salehi, a research group leader at Freie Universität Berlin.
Sarah, where do things stand on government negotiations with the IMF/World Bank? If an IMF loan doesn't materialize and Gulf states don't offer help, what is Saied's "plan B" to prevent an economic crisis?
Sarah Yerkes: It looks like negotiations with the IMF are progressing. The international community is very worried about the potential for financial collapse in Tunisia and seems willing, for now, to overlook Saied’s authoritarian consolidation and push forward with assistance without political conditionality. IMF Middle East and Central Asia Director Jihad Azour said after a recent visit that he hoped that all parties (i.e., the UGTT) will agree to the IMF deal and Saied’s economic reform plan, but the IMF seems willing to push ahead with a deal regardless of whether the UGTT signs on. That doesn’t mean Saied has an easy road ahead by any means, but it does increase the likelihood of an IMF deal coming to fruition in the coming weeks and months, even if that leads to more protests and strikes by the UGTT and others.
Nate, the UGTT and the president are in a direct confrontation. One point of contention is whether to slash public sector spending in line with the purported IMF-World Bank recommendations. Does Saied have the strength to squeeze the UGTT for concessions?
Nate Grubman: Saied has generally behaved as if he has little to fear from the UGTT. Although the union has emerged as a powerful advocate for public sector workers, it is often reluctant to enter into political conflicts that divide its members. It avoided a direct confrontation last year, praising the July 25 path but calling on Saied to be more inclusive. But recent moves by the government suggest that Saied’s “new republic” may not accord the UGTT the power it held in the pre-July 25 system. The government’s December decision to restrict the ability of ministers to bargain with the UGTT was a principal cause of the general strike. And a leaked excerpt of the constitutional draft offers more tepid protection of union rights than did the 2014 constitution, angering UGTT leadership. Whether the UGTT boycotts or mobilizes its members to vote no could be important to determining the results of the referendum.
Sharan, do you see an opportunity for Saied to make a deal with the IMF to secure the loan while still appeasing the UGTT? Or are these mutually exclusive?
Sharan Grewal: On the economic side, I find it more likely that Saied will ally with the UGTT. Saied has never been keen on the subsidy cuts and selling of state-owned enterprises, viewing these as foreign dictates and a “kind of slavery.” Likewise, the only parties still openly supportive of Saied are leftist, Arab nationalists that similarly oppose these reforms. Saied and his ministers are therefore likely to use the UGTT’s opposition to their advantage in their discussions with the IMF, convincing it to drop or water down the economic reforms but still grant the loan to keep Tunisia afloat, continuing the trend of the last 10 years.
On the political side, I do not see Saied compromising and governing more inclusively any time soon. With the UGTT and most political parties advocating a boycott of the referendum, rather than vote no, Saied does not need their support to get his constitution passed. Unless they credibly threaten to vote no, Saied has little incentive to compromise.
Sarah, where do you come down on this?
Sarah Yerkes: I agree with Sharan and Nate. I don’t really see either Saied or the UGTT capitulating to the other at this point. The UGTT is, in a way, the kingmaker right now and they are finally flexing their muscles after hemming and hawing for the first 10 months after Saied’s coup. The high level of participation in the June 16 general strike shows their ability to mobilize a large percentage of the population. Still, the strike was not very successful in that many Tunisians reported that the bureaucracy is always slow, so one day without bureaucrats was not very painful for most. As Nate said, the real question is what the UGTT decides to do about the referendum. They are expected to vote soon on whether to vote yes, no or boycott. If they choose to vote no, as a bloc, they could cause real damage to Saied’s efforts. If they choose to boycott, the referendum will still likely pass, just with a lower voter turnout, which won’t make a difference in the final result.
The other question is whether Saied does some sort of backroom deal with the UGTT to assuage their fears. For example, Saied making it clear that he will not actually enforce the IMF conditionality on reforms if the UGTT allows the deal to go forward.
Prior to the UGTT strikes, it seemed that a sizable percentage of the country's more secular political, business, and intellectual elite were not actively opposing Saied's consolidation of executive power. Is that because Saied took such a hard line against Ennahda and other Islamist groups — an example of "the enemy of my enemy is my friend?”
Sharan Grewal: Yes and no. Initially, yes, many secular parties were optimistic that Saied might dissolve Ennahda but not their parties, such that they might acquire a larger share of political power. But Saied failed to effectively exploit this division, which would have required reassuring those parties that they would not also be dissolved. Without that guarantee, most of these parties have gradually shifted to condemning and confronting Saied. Qalb Tounes, the largest secular party in the dissolved parliament, condemned the coup from day one and joined the Citizens against the Coup and National Salvation Front movements. The Free Destourian Party, Tayyar Democrati, Ettakatol and Jumhouri, among others, have also soured on Saied and openly criticized his consolidation of power. It is only really a small minority of leftist, Arab nationalist parties that continue to support Saied or are even neutral. Many of the truly secular parties were initially wary of Saied back in 2019, when they viewed him as a socially conservative, closet Islamist — hardly an ally for them.
Mohamed-Dhia, why do you think there hasn’t been more outrage about Saied’s consolidation of power from secular leaders?
Mohamed-Dhia Hammami: During such a period of uncertainty, a proportion of historically established elite actors prefer keeping a low profile to avoid targeted attacks or ending up on the losing side. As long as there are enough people to lead the fight, they adopt a wait-and-see approach. In this case, we have a typical free-rider problem. Other business leaders from the Ben Ali era see Saied as a potential autocratic leader who can re-establish the stability they need to run their businesses. Saied's supporters have also been intimidating some individuals and organizations with a critical stance toward the president. This includes former parliamentarians, media figures and NGOs. Most of those who think of Saied as an ally against Ennahda are on the left side of the political spectrum. They tend to be vocal about their support to Saied, and their animosity toward Ennahda. Secular centrists who do not see Saied as a serious threat to electoralism or do not have a fundamental problem with the return of authoritarianism think that any association with Ennahda would harm their party in the next elections. They are either quiet, waiting for the overall situation to become clearer, or vocally critical of both Saied and Ennahda.
The scheduled July 25 date for a referendum is fast approaching. Miriam, assuming there is a referendum in the coming weeks, what do you expect turnout to be like and do think violence will come along with it?
Mariam Salehi: I would be surprised if the level of turnout was particularly high for several reasons. First, because of the general dissatisfaction and frustration with political processes and institutions that have been voiced over the last years and that also influenced electoral turnout in the past. Second, I would also assume that parts of society are going to boycott because they do not want to legitimize a process — and a president — that they consider to be illegitimate. And lastly, if the referendum takes place at very short notice, there may also be logistical reasons that would lower turnout.
I always find it tricky to talk about the likelihood of violence because one also does not want to “summon” it. However, given the continuous frustrations concerning the state of the economy and politics, if there would be violence, the referendum would be a trigger, but not the main reason.
Mohamed-Dhia, what are your thoughts about the prospects for participation in a referendum?
Mohamed-Dhia Hammami: The rate of participation is expected to be less than 10%. Saied’s support base is passive, and does not have a strong mobilization capacity, as Sharan and I wrote about in April. Since Saied’s active supporters are already using intimidation tactics, I would not be surprised to see his organizers physically intimidating voters. However, I would be surprised if the tensions lead to large-scale or serious violence. Since Ennahda refrained from using violence since July 25, I do not think they will resort to physical confrontation with Saied supporters. Relatively marginal voices within the Islamist clan are frustrated by the inefficiency of nonviolent methods of resistance to Saied adopted by Ennahda leaders.
Traditionally, populist leaders mobilize state institutions to attack crony capitalists and oligarchic private sector monopolies, promising to take back what was stolen and redistribute it to the people. Saied has attacked state institutions, but made no moves against private sector elites. Nate, is Saied a populist or has he been mislabeled?
Nate Grubman: Saied has long spoken of an unnamed cabal of corrupt figures impoverishing Tunisians. He has spoken of the need for “penal reconciliation,” through which the state would confiscate the ill-gotten gains of corrupt figures and channel them into local development projects. Saied has also railed against “monopolists” who he accuses of driving up prices to weaken Tunisia. Since July 25, public officials have conducted periodic raids of warehouses where goods are supposedly being hoarded. And Saied issued decrees to establish penal reconciliation and strengthen the punishments against monopolists. But the mechanics of penal reconciliation have always been murky and the gains highly uncertain. And although public officials have confiscated the goods of some minor businessmen, they avoid conflict with the big fish. Saied is indeed a populist. But despite his rhetoric, he either lacks the power or will to get into a conflict with the economic elite.
Mohammad Dawood Sofi, do you agree with Nate’s characterization?
Mohammd Dawood Sofi: It is true that Saied has been mischaracterized. The point is that the people in general were tired of the political class that was ruling Tunisia. All the political parties, including Ennahda, did not think about the interest of the country and reforming the economy. They failed to fulfill the demands of the revolution and were only concerned with ideological differences. Therefore, people felt frustrated and accepted Saied’s moves. Despite Tunisia facing a huge economic challenge, it is not in his interest to attack crony capitalists and businessmen, because if he imposes penalties on them, the common people will suffer and lose jobs, making the situation worse. More importantly, he is not willing to openly confront these crony capitalists perhaps fearing losing their support. He is a populist but unrealistic and carries a project that is difficult to achieve on the ground. While he focuses on tailoring a new constitution and organizing a referendum, it seems a strong opposition is emerging against him because he has started to attack other institutions like the judiciary and even the unions.
Mariam Salehi, what do you make of Saied?
Miriam Salehi: I would put it a bit differently (or more abstractly), I think there are two aspects to distinguish here: what his political goals are and what he is able to do. Given the huge frustration with the political class and the state of the economy, he offered a vision that appealed to people who hoped that he would make things better. However, with his very peculiar ideas about how the state should look like and how it should function, he does not seem to be able to satisfy the people’s demands. This may be related to both aspects mentioned above: the ideas are probably not suitable and/or he is not able to implement the necessary measures.