Smuggling costs Tunisia hundreds of millions of dollars

Smuggling in Tunisia has become one of its largest industries, as huge amounts of gasoline, cigarettes and weapons are crossing the borders in trucks.

al-monitor A man fills containers with gasoline at the southern Libya-Tunisia border crossing in Dehiba, April 17, 2012. Photo by REUTERS/Zoubeir Souissi.

Topics covered

tunisian economy, tunisia, terrorist organizations, smuggling, libya, corruption, cigarettes, border security

Nov 10, 2014

Many analysts and experts on terrorism have come to highlight the fundamental link between smuggling and the financing of terrorist operations. In countries other than Tunisia, terrorist networks use kidnapping and ransom, in addition to smuggling, to finance themselves. In Tunisia, smuggling operations have undergone a real boom since the revolution. Not only did this ease the movement of terrorists, but it also provided them with vital support.

Smuggling in Tunisia has become an endemic problem that is seriously weighing on the economy. This phenomenon is even more pronounced, knowing that smuggling is also being used as a funding pool for terrorist groups in Libya, Algeria, Mali and Tunisia. It is almost impossible to completely monitor such a vast territory as the Sahel, and the challenges are myriad: the extent of the surface, the nature of the desert terrain, the need for concerted action on the part of several countries and the lack of resources, among others.

There is a wide variety of illegally imported products in Tunisia, starting with televisions, food products, cigarettes and gasoline. With rising prices and the high cost of living, more and more people are consuming smuggled products. We even saw government vehicles filling up with gasoline from smugglers, knowing that these vehicles receive fuel vouchers from the state!

Obviously, this phenomenon has a cost. The World Bank conducted a study titled, “Estimating Informal Trade across Tunisia's 
Land Borders
.” The figures developed by this study show the dizzying heights that the amounts in question have reached. The losses incurred by the Tunisian state due to the parallel trade amounted to 1.2 billion dinars ($650 million), of which 500 million dinars ($271 million) were lost in customs duties. This amount accounts for 4.24% of the state budget in 2014, which is equivalent to the Health Department's operating expenses for the year 2013. In other words, this phenomenon is costly for the Tunisian state.

The turnover of the parallel trade, according to the same study, is 1.8 billion dinars ($977 million). This equals half the official trade with Libya and exceeds the official trade with Algeria. The study also shows that fuel smuggling is the most lucrative.

The math was made based on the price scale of goods freely sold in all three countries. Therefore, there is no mention of the amounts that the trade in weapons or drugs can reach. Yet, when we know that 3,000 trucks travel between Tunisia and Algeria and even Libya, it’s reasonable to assume the existence and extent of the actual traffic. The Tunisian security forces operations have confirmed this fact, as Tunisian authorities have indeed seized weapons and drugs, mainly near the Libyan border.

In the Tunisian border regions, networks established many years ago control parallel trade with an iron fist. Near the Tunisian land borders, there are smuggling lords called “knatreya” in the Tunisian dialect. These people openly display their illegally obtained wealth, characterized by sumptuous multistory villas and expensive luxury cars next to the 4x4 vehicles used for smuggling.

In these areas, people who engage in this activity are well known and their actions are a matter of public record. This raises the issue of the intervention of security forces in these areas. For years, the parallel trade has been coupled with corruption, another rampant phenomenon in Tunisia. Indeed, the corruption of certain services in some regions of the country contributes in loosening the grip on all types of traffickers. With the help of some personalities, it becomes possible to evade controls and avoid any kind of investigation.

Add to this two years of total slackening of security measures that contributed to the development of trafficking. Nowadays, the sale of smuggled gasoline has reached record levels. Sellers act with such flagrant impunity that they do not hesitate to settle in the capital, while at first they used to content themselves with proliferating along the small roads of border governorates.

At the government level, several statements highlighted the danger that may be posed by this phenomenon. Minister of Commerce Najla Harrouche has been relentlessly warning of the loss of profit that may be caused by this phenomenon, calling on citizens to boycott smuggled products and to cease getting supplies from the informal circuit. The head of government, Mehdi Jomaa, also admitted that parallel trade has become a worrying phenomenon, given its development. For its part, civil society, most notably the Tunisian Union for Industry, Commerce and Handicrafts (UTICA), sounded the alarm several times. Wided Bouchamaoui, the president of the employers' union, warned the authorities and the public about the seriousness of smuggling.

Yet no tangible measure is being taken against the parallel trade in Tunisia. No measure is taken, apart from declarations of intent, since all stakeholders give the impression of being aware of the seriousness of this matter. We still find Algerian cigarettes across Tunisia, sold at the lowest price and we also find smuggled gasoline across the country, not to mention electronics and other products. We know well that weapons and drugs enter our country through the same channels, often in the same trucks. We also know that a significant portion of this trafficking activity allows the financing of terrorist networks that come to kill our soldiers with new weapons. Why doesn't the government dry up this source of financing? Why do we continue buying smuggled goods? The question remains to be answered.

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