Summary:

Last week, Tunisian Minister of Transportation Rabie al Majidi addressed Parliament in a hearing on his Ministry’s budget, making it clear that the proposed deep water port project at the Enfidha port was not imminently moving forward.

In his testimony to the MPs, Majidi reported that the draft call for tenders for the Enfidha deep water port had not been approved by the High Committee of Public Requests. The Minister reported that the Committee had replied to the draft call for tenders, indicating that the financial conditions were “unacceptable.” 

Majidi indicated to the MPs that Tunisia now had three options with regard to the project: draft a new call for tenders, find another source of strategic investment funds, or explore a complete reinvention of the project altogether. 

The Enfidha project was conceptualized nearly two decades ago, but delays in securing financing and other hurdles have kept the project from moving forward. At one point, a target date of 2019 was identified for completion of the project, but delays have continued. 

Outlook: 

The Enfidha deep water port has long held the promise of significant economic benefit in Tunisia, however, other port projects in the region have progressed while Enfidha has only experienced delays. 

The primary challenge appears to be Tunisa’s ability to attract foreign investment. The current economic and political climate has encouraged hesitance among large-scale foreign investors who see more attractive opportunities in Algeria and Egypt for the investment climate. Also, neighboring countries appear to have more flexible and adaptable labor environments which make them more attractive for large-scale projects. 

Tunisia remains in arbitration with a Canadian extractives firm over disputes in implementing contracts. This likely serves as one of many cases that raises concern among foreign investors about the fate of projects in a country still struggling to manage localized corruption and a complex, often opaque regulatory environment. 

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