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In this paper, a recursive-dynamic CGE model is used to analyze forces that drive food self-sufficiency in Tunisia up to 2019, including domestic policies. We explore the impact of two policies, agricultural liberalization and increased government spending to raise yields, as well as the role of increased urbanization. Our results indicate the presence of trade-offs between the government goals of food self-sufficiency and improved welfare for both rural and urban households. The results for a scenario that combines liberalization, increased government spending on agriculture, and accelerated urbanization shows a stronger performance in terms of both self-sufficiency and welfare objectives.

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.