Economic stabilisation and youth employment

Project description

Project title: Initiative for Economic Stabilisation and Youth Employment (ISECO)
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Tunisia
Lead executing agency: Ministère de l’Industrie et des PMEs
Overall term: 2015 to 2022

Context

In the period since the 2011 revolution, Tunisia has experienced far-reaching social and political change. To date the Government has struggled in its efforts to address the persistently high level of unemployment, particularly among young people, women and young university graduates. There are also major economic and social disparities between different regions. Whereas recent decades have seen export-oriented supply and manufacturing industries become established in coastal areas, many inland locations lack an effective economic structure. 

The country’s rural regions in particular, therefore, are exposed to a significant risk of conflict. Economic development and greater opportunities for employment are therefore vital for stabilising the political system and democracy. However, the regions are held back as their structures for supporting innovative business start-ups are weak. If businesses are launched at all, they are mostly in sectors where competitiveness is poor. By contrast, hardly any businesses are set up in sectors with growth potential such as information technology.

Objective

The employment and income situation has improved, especially for young women and men in disadvantaged regions.

Approach

The project supports business founders and young entrepreneurs in 15 governorates of Tunisia. It comprises three fields of activity.

1.    Promoting business start-ups in inland areas
Business founders in inland areas receive individual coaching, including in niche sectors, to help improve their business plans and thus pave the way for setting up a business, arranging finance and increasing their incomes. The project focuses primarily on forward-looking industries with growth potential – for instance in information technology, the textile sector and recycling raw materials. It also supports selected civil-society, private-sector and government organisations in their efforts to expand their range of business start-up promotion services. To this end, in eight governorates the project is backing cooperation mechanisms that represent the local start-up-support ecosystems. The services are being improved and broadened, and offered on a needs-driven basis. 

2.    Developing the range of advisory services for businesses following start-up
A range of advisory services for the post-start-up phase was tested in two pilot projects and is now being expanded in eight governorates. In future this will help young entrepreneurs to consolidate their business during the critical first few years and harness their potential for growth. Support committees in the inland regions offer the new start-up and post-start-up promotion services, involving representatives of government, civil society and the private sector joining together with support from the project. The committee members include financial actors, whose role is to facilitate businesses’ access to financial resources and expertise.

3.    Improving the services provided by cyber parks for ICT start-ups
‘Cyber parks’, industrial parks geared specifically to information and communications technology (ICT), are being equipped to offer demand-driven services. Three cyber parks have received help in devising and implementing strategy plans and improving their management expertise. Fledgling ICT start-ups have gained commercial and industry-specific knowledge that enables them to develop new products. A massive open online course (MOOC) provided free training for young graduates and unemployed people on developing apps, and a competition held at the end of the course awarded prizes to participants with the most innovative results. The developers were also given support to improve their apps so that they can be sold on international sales platforms and thus generate income.

The project’s lead executing agency is Tunisia’s Ministry of Industry and SMEs. Other national partners include centres of innovation and state-run business centres, entrepreneurs’ associations, technology and start-up centres and non-governmental organisations.

The project is part of a special initiative designed to stabilise and promote development in North Africa and the Middle East run by Germany’s Federal Ministry for Economic Cooperation and Development (BMZ). Through the projects implemented as part of the initiative, BMZ is helping to open up economic and social prospects for people in the region. Within this context, an additional sum of more than EUR 300 million has been earmarked for projects carried out by GIZ and other implementing organisations in the period from 2014 to 2021. The focus is on empowering young people, promoting employment, improving economic stability, fostering democracy and stabilising neighbouring countries in crisis situations.

Results

Since 2015 the project has supported more than 365 business founders and young entrepreneurs in economically disadvantaged regions of Tunisia in their endeavours to develop their businesses, create new jobs and generate income. 

One specific example is Startup Tunisia, a new fair for entrepreneurs that was held in seven inland regions in 2015 and 2016. It was run by private-sector and government partners and was supported by the project. A competition for the best company start-up ideas was held at the fair, with a total of 466 potential business founders taking part. They submitted their business concepts online. The jury rated them according to criteria such as the degree of innovation, the maturity of the business plan, market suitability, personal commitment and motivation before finally selecting the best project ideas. The project analysed the concepts and established what support services were required. The outcome was that more than 20 people have already put their business ideas into practice, and another 82 innovative and promising young entrepreneurs are being guided as they work towards setting up a business, for instance with advice on producing and marketing leather goods.

To date, with support from the project, 1,520 young people and other underemployed and unemployed individuals, 777 of them women, have taken up employment and are thus earning a regular income. In addition, 48 entrepreneurs are participating in a scheme providing post-start-up advice in the two pilot regions, Sfax and Kairouan.

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