Foreign Direct Investment in Tunisia: Role of the Free Trade Agreement with European Union

Abstract

The aim of this study is to determine whether Tunisia could expect an increase in Foreign Direct Investment (FDI) flows in response to the establishment of a Free Trade Agreement (FTA) with the European Union (EU). While the conditions necessary to stimulate the flow of FDI have received considerable attention from economists in recent years, the relationship between trade policy and FDI has not been the subject of in-depth research. The study finds that the partnership agreement between Tunisia and the EU can play a catalytic role in increasing not only the openness of the Tunisian economy, but, subsequently, increasing FDI to Tunisia.

Citation

Abdelbasset Chemingui, M. and Colton, N.A. (2005), "Foreign Direct Investment in Tunisia: Role of the Free Trade Agreement with European Union", Neaime, S. and Colton, N.A. (Ed.) Money and Finance in the Middle East: Missed Oportunities or Future Prospects? (Research in Middle East Economics, Vol. 6), Emerald Group Publishing Limited, Leeds, pp. 21-41. https://doi.org/10.1016/S1094-5334(05)06002-4