But industry wants labor flexibility

Tunisia is counting on its ties with European Union and other Mediterranean basin countries to save its struggling textile industry, a vital sector threatened by the uninhibited access Asian products will have to the key European market after the expiration of the Multifiber Accords at the beginning of 2005.
Linked to the European Union since 1995 through a partnership and free-trade agreement, Tunisia is the EU’s fourth-biggest textiles supplier and was the main supplier for France before being overtaken by China in 2003, according to the Central Bank of Tunisia.
Textiles and clothing represent about 50 percent of the North African country’s exports or about three billion euros ($ 3.7 billion) per year. The industry employs 250,000 people in 2,000 companies.
With the loss of tariff protections that allowed the country to export 80 percent of its products to Europe, Tunisia hopes ties with partners in the Europe-Mediterranean region will help it resist stiff competition from Chinese products.
At the beginning of 2005, the so-called Multifiber Accords setting quotas for the import of textile products will expire with the expected effect of a surge in highly competitive exports from Asia, notably from China.
Trade Minister Mondher Zenaidi tied the future of the textile industry to the Euro-Mediterranean trade and development partnership between the European Union and 12 Mediterranean countries that was founded in 1995 in Barcelona and is sometimes know as Euromed or the Barcelona process.
Zenaidi told ministers from around the Mediterranean meeting here on Tuesday that the textile sector was "the cement of Euromed and its future depends on the Barcelona process."
The process marked the beginning in 1995 of a framework for political, economic and social relations between the European Union and countries on the southern edge of the Mediterranean basin. Its relaunch is slated for 2005.
The textile and clothing industry "illustrates perhaps better than other sectors the importance of the partnership and the solidarity links that unite us," said Zenaidi, pushing for new life to be breathed into the process.
That would allow Tunisian firms to become more than just subcontractors, he said.
Tunisian executives are uniting with colleagues in the Euromed zone to push governments and the European Commission to negotiate at the World Trade Organization to maintain preferential tariffs around the zone.
Tunisia has found an ally in France which is encouraging the creation in Europe of a mechanism for monitoring prices and quantity of Asian imports, particularly from China.
Industry and public officials have been studying ways over the summer to keep the sector going in the face of a structural crisis despite modernization attempts.
In Tunisia the industry is fragmented and focused on poorly paying subcontracting work. One expert said that Tunisian textile firms were little more than "order receivers, or even labelers" over the past three decades.
After strong growth from 1997 to 2001, the sector’s production has stagnated. Between 2001 and 2003, growth has slumped to one percent on average with threading and weaving firms the worst hit.
The slowdown has also hit products exported in large quantities such as work clothes or baby clothes.
Textile industry executives are clamoring for social charges to be softened and for greater working time flexibility. They have also backed a free-trade arrangement with Turkey, signed Tuesday and under which Tunisia will be able to export to Europe products made with Turkish textiles.
After 2005, Tunisia will have to specialize in niche markets such as knitwear, underwear and hats, said an expert.

Hamida Ben Salah
© Agence France Presse
Tunis - 30 - 09 - 2004