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How are Tunisia’s plastics businesses faring during the COVID-19 crisis?

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Back in April, the International Monetary Fund approved a $745 million emergency loan to help Tunisia navigate the financial impact of the COVID-19 pandemic. The IMF also forecast the economy would contract by 4.3% this year.

Amongst the sectors affected by the COVID-19 pandemic is Tunisia’s plastics industry.

According to economist Faycal Bradai from the Tunisian Union of Trade & Industry, plastic production in the country fell by around 20% between March and June of this year.

The plastics sector, which falls under the national chemicals industry, has enjoyed steady growth in recent years, with free trade zones along Tunisia’s coast becoming home to hundreds of manufacturers.

Many of these companies have been exporting solely to Europe, Tunisia’s largest trading partner. It’s a place where, according to EU data, 80% of the country’s products were shipped in 2017.

Industrial impact

For the most part, car parts have been the chief export of Tunisian manufacturers to automobile companies in Germany & France.

Faycal Ben Hammuda is an industrial engineer and general supervisor at Plasteel, a Tunisian auto manufacturing company. With more than twenty-five-years’ experience in the sector, the 58-year-old says that new technologies are determining the industry’s future.

“We have been investing in a high-tech cutting machine, to make metallic parts, instead of buying them in,” he told Euronews. “We did this in response to our clients around the world demanding the highest production standards.”

Faycal Ben Hammuda speaks to Inspire Middle East

Like many of its peers, Plasteel was unable to avoid the economic impact of COVID-19. The company has booked losses of around $1.9 million with many employees taking 20% salary cuts.

Abiding by social distancing rules, just ten employees remained on-site at one factory unit during lockdown, to complete outstanding orders for foreign clients.

Unclear outlook

Omar Chakchak, the vice president of Tunisia’s National Union & Chamber of Plastic Processor Manufacturers, sees a gradual improvement in the country’s plastics industry. It may take some time, however, he says:

“Our organisation’s real concerns now, with the detection of more cases of COVID-19 in Tunisia, are outbreaks in some industrial units.”

The outlook is still unclear for many of Tunisia’s industrial manufacturers, and nationwide unemployment rose to 18% in the second quarter.

Many businesses are now hoping that the government & the central bank will do more to support them in the months ahead. Which may, some analysts say, eventually allow Tunisia to fulfil its dream of becoming as a world-class plastics hub for North Africa.