Stability Under Pressure:
the political and social risks
of macroeconomic deterioration

One of the most striking findings to emerge from recent economic debate concerns the genuine weakness of Tunisian growth. The official figures convey the image of a modest recovery, with year-on-year growth of around 2.6%. Yet several economists stress that this reading is misleading.

The comparisons are drawn against already depressed periods, which mechanically produces statistical catch-up effects. In reality, the sectoral and monetary data point to a far deeper stagnation. Real GDP per capita remains below its pre-Covid level1. Imports of capital goods — often regarded as a leading indicator of future investment — remain weak and far below the levels observed in the 2000s or the early 2010s. Tunisian banks themselves report receiving very few new private investment projects.

This collapse in investment is probably the most worrying signal for the country's future. An economy can survive temporarily with weak growth; it becomes far more vulnerable when it ceases to invest in its future productive capacity. In Tunisia, this weakness affects public and private investment alike.

Public investment remains formally inscribed in the budgets, but execution rates remain low. Fiscal constraints regularly push the state to sacrifice capital spending in order to preserve current expenditure, particularly wages and social outlays. As for the private sector, it operates in a climate of uncertainty shaped by the economic slowdown, the difficulty of accessing financing, weak demand, and a loss of political visibility.

This situation gradually nurtures an economy of survival rather than one of projection. Firms seek to limit their risks rather than to expand. Households cut back on discretionary spending. Skilled young people turn to emigration. Over the medium term, this logic produces a form of silent decapitalisation of the country, expressed in the progressive impoverishment of households, the erosion of productive capacity, and the growing pauperisation of a large segment of the population.

The principal channel transmitting the economic crisis to Tunisian society remains purchasing power. Official inflation has eased relative to the peaks observed after the war in Ukraine, but this slowdown conceals several significant distortions.

First, a substantial share of prices remains administered. The prices of certain basic goods — fuel, bread, dairy products, and meat — are partly regulated or subsidised, which artificially lowers some official indicators. Second, several economists stress that the basket used to measure inflation no longer truly reflects the consumption patterns of Tunisian households. The social perception of inflation therefore remains far higher than the official figures.

This perception is reinforced by a profound transformation in dietary and consumption behaviour. Several observers note that progressive impoverishment is pushing a growing share of households towards cheaper but also less nutritious products. The consumption of animal protein is falling while the consumption of cereal-based products is rising2. This shift is not merely economic; it is becoming anthropological and political. A society in which the middle classes are gradually lowering their quality of life often develops a sense of downward mobility more explosive than that found in contexts of long-standing poverty.

The purchasing-power crisis also affects the relationship between citizens and institutions. Public services are deteriorating even as the tax burden remains high. Households feel they are paying more to receive less: lower quality in education, weaker performance in transport, reduced hospital capacity, and diminished urban infrastructure.

This social stability depends largely on informal compensatory mechanisms: family solidarity, remittances from the diaspora, the informal economy, private credit, and the maintenance of certain subsidies. These mechanisms are, however, undermined by the sharp rise in household debt: according to a recent IACE study, average indebtedness has increased by nearly 66% over ten years, pushing the budgetary fragility ratio to around 171% and considerably narrowing households' room for manoeuvre3. Yet these mechanisms themselves are beginning to show signs of exhaustion.

One of the most significant phenomena of the recent period is the rise of a diffuse crisis of confidence in money. It does not take the form of an open banking panic, but of a gradual loss of trust in monetary and financial institutions.

The sharp rise in cash in circulation is an important signal4. Banknotes and coins now account for an unusually high share of the money supply. This increase reflects several simultaneous dynamics: the growth of the informal sector, distrust of banks, the search for protection against uncertainty, and the rise of parallel currency-exchange networks. In several Tunisian cities, the informal foreign-exchange market now operates almost in the open. A growing share of households seek to hold their savings in euros or dollars rather than in dinars.

This situation fuels a vicious circle. The more confidence in the national currency erodes, the more individual protective behaviour spreads. The more such behaviour spreads, the more pressure builds on the monetary system. At the same time, Tunisian banks are becoming increasingly dependent on financing the state. A growing share of their assets now consists of sovereign claims or indirect financing of struggling public enterprises. This trend mechanically reduces their capacity to finance the productive economy.

Small and medium-sized enterprises face mounting difficulties in accessing credit. Even the public banks now refuse to finance certain heavily indebted state-owned enterprises. As for private banks, they are adopting increasingly cautious strategies. This produces a phenomenon of economic fragmentation: the state absorbs a growing share of available financial resources while the productive economy is starved of financing. Over the long term, this dynamic threatens the very capacity of the Tunisian banking system to perform its historic role of economic intermediation.

Tunisia's energy dependence is today one of the principal vectors of systemic vulnerability. The country imports roughly two-thirds of its energy needs5.

Tunisia's electricity supply still relies heavily on natural gas, imported mainly from Algeria via the Mediterranean gas corridors. This dependence is not merely a commercial matter; it carries a direct geopolitical dimension, as illustrated by the contrasting strategic centralities of Algeria and Morocco. The Middle East crisis has been a brutal reminder that energy is not simply an economic input but a piece of political infrastructure.

A sustained rise in oil or gas prices immediately produces several simultaneous effects: a worsening fiscal deficit, pressure on foreign-exchange reserves, higher industrial costs, food inflation through agricultural inputs, and social tensions linked to fuel and transport. Tunisia's problem lies in the cumulative effect of these shocks. The Tunisian state no longer has the fiscal headroom that would allow it to absorb large energy-price increases on a durable basis. The public energy enterprises — notably STEG and STIR — are themselves financially weakened.

This situation is gradually turning energy into a question of political stability. An abrupt reform of prices could trigger significant social tensions. Yet the absence of reform simultaneously aggravates the fiscal and financial imbalances. Tunisia thus finds itself locked into a logic of permanent defensive management.

The paradox is that the country possesses considerable solar potential yet remains far behind in its energy transition6. This slowness is not explained by technical constraints alone. It also reflects institutional blockages, weak planning capacity, and the absence of a genuine energy doctrine articulating sovereignty, industry, and social justice — an issue we examine in detail in connection with Tunisia's sun held hostage by solar concessions.

One of the major risks of the current sequence is precisely that economic deterioration may produce not a single type of political reaction, but several potentially contradictory dynamics.

The first hypothesis is a return of classic social mobilisation: protests against the cost of living, sectoral strikes, tensions over shortages, and resistance to price increases or subsidy reform. Tunisian history shows that prolonged economic crises often end in moments of rupture when compensatory mechanisms become insufficient. The bread riots of 1984, the revolts of the mining basin in 2008, and certain post-2011 mobilisations are reminders that the social question remains deeply explosive in the Tunisian context.

But the second risk is more ambiguous, and perhaps even more troubling: the radicalisation of part of the regime's own base of support. In contexts of prolonged stagnation, where material hardship grows but power retains a symbolic or moral legitimacy among a segment of the population, the search for those to blame can gradually shift towards groups designated as internal enemies.

This logic is already visible in certain segments of Tunisian public debate. Economic deterioration is often attributed not to structural blockages or to errors of economic policy, but to actors cast as saboteurs: speculators, corruption networks, political opponents, businesspeople, civil servants accused of obstructing reform, foreign actors, sub-Saharan migrants, or various minorities. In this kind of configuration, the economic crisis can produce a dynamic of social polarisation far more dangerous than mere anti-government protest.

The danger is then that of a gradual shift from economic conflict to identity-based and punitive conflict7. In several international contexts, prolonged economic crises have already shown that they can simultaneously produce social movements against those in power and forms of pro-regime radicalisation directed against categories blamed for collective hardship. Tunisia is, of course, not in such a situation today. But prolonged economic erosion, combined with the weakening of political mediation and the spread of rhetoric designating internal enemies, constitutes a risk factor that can no longer be ignored.

Tunisia's current vulnerability does not stem from economic indicators alone. It also lies in the progressive weakening of the political and social mechanisms capable of absorbing tensions. For several decades, Tunisian society possessed intermediary institutions that played a stabilising role: powerful trade unions, professional organisations, political parties, associations, local structures, and territorial administrations. Even when contentious, these spaces made it possible to translate social tensions into negotiations.

Today, many of these mechanisms appear weakened8. The Tunisian General Labour Union retains considerable symbolic weight, but its role in economic and social bargaining has sharply diminished. Political parties are discredited or marginalised. Local authorities have lost part of their autonomy and capacity to act. Civil society operates in a climate of mounting pressure. The Tunisian risk is therefore not solely that of an immediate social explosion. It is also that of a slow deterioration of governability: the state may continue to function administratively while gradually losing its capacity to produce consent.

One of the distinctive features of the current situation lies in the gap between the worsening of economic fragilities and the relative persistence of a degree of political stability.

A segment of the population continues to support those in power, in part because the leadership retains an image of integrity and of opposition to the former political elites. This legitimacy, however, rests less on economic performance than on a moral and symbolic dimension. The current leadership still benefits from a political narrative structured around the fight against corruption, the rejection of the old parties, and the denunciation of influence networks. But this kind of legitimacy has material limits.

The current Tunisian risk is precisely that of a crisis with no identifiable timeline. Economic stagnation has lasted more than a decade. The younger generations have known neither strong growth nor any real improvement in the labour market. Public services are deteriorating continuously. The prospects for social mobility are narrowing. This situation gradually nurtures a diffuse political fatigue. The fraying of the leadership's popular base does not necessarily mean the immediate emergence of a structured political alternative. It may also produce a form of collective disengagement, social withdrawal, and the fragmentation of behaviour.

Several Tunisian economists stress that the main current adjustment mechanism is no longer really economic reform but shortage9.

This logic is not new in recent Tunisian history, but it is tending to become generalised. When budgetary resources become insufficient to support subsidies, imports, public enterprises, and financial balances all at once, the system begins to adjust through scarcity: occasional shortages of certain goods, payment delays, deteriorating infrastructure, the implicit rationing of credit, or the silent reduction of certain services.

The danger of this mode of adjustment is that it gradually erodes collective confidence. A society can endure difficult reforms when they are coherent and legible. It endures far less easily a diffuse and disorderly deterioration. The major political risk is therefore not solely that of mass demonstrations or a brutal shock. It also lies in the progressive normalisation of a sense of permanent dysfunction. When shortages, outages, delays, and decay become routine, citizens gradually cease to see the state as capable of organising the collective future.

The question of a possible return to an agreement with the IMF now runs through the whole of Tunisian economic debate. But this question is often poorly framed.

The IMF is not merely a lender; it also functions as a mechanism of external credibility. An agreement with the Fund could facilitate access to other international financing, ease certain pressures on foreign-exchange reserves, and temporarily improve the country's financial visibility10. Past experience, however, has profoundly undermined the political legitimacy of adjustment programmes. A significant share of Tunisian society now associates IMF-backed reforms with rising prices, the reduction of social protections, and widening inequality.

Tunisia's problem is therefore not solely economic; it is also political. A reform programme can only be sustainable if there exist credible compensatory mechanisms, institutions capable of negotiating the trade-offs, and a minimal perception of fairness in the distribution of costs. Yet that is precisely what is missing today. Without rebuilding social mediation and without a legible economic strategy, a possible agreement with the IMF risks being perceived as a mere outsourcing of budgetary constraints.

The current Tunisian crisis far exceeds the traditional categories of macroeconomic analysis. The real challenge is no longer merely one of deficits, debt, or growth. It concerns the capacity of the state and of society to maintain a minimal level of cohesion and collective projection in a context of cumulative vulnerabilities.

Tunisia is gradually entering a danger zone characterised by the combination of several dynamics: durable economic stagnation, energy dependence, food vulnerability, the weakening of the banking system, a crisis of monetary confidence, the erosion of public services, and the fragmentation of political mediation. The principal danger lies in the systemic nature of these fragilities. None of them, in isolation, is sufficient to trigger a major rupture. But their combination gradually erodes the resilience capacities of the Tunisian system.

The apparent stability of the present moment may thus mask a silent accumulation of economic and social tensions. The strategic challenge for Tunisia is therefore not solely to restore growth. It is to rebuild collective capacities for governance in a world marked by energy, climate, and geopolitical shocks. This requires rethinking, simultaneously, energy policy, the financing of the state, social protections, the productive transition, and the mechanisms of political mediation.