Tunisia: riots to bring increased opportunities?

After 23 years of rule, Tunisian President, Zine al-Abidine Ben Ali, has been ousted. The unrest was instigated by a single protester who set himself on fire following the confiscation of his stock (police claimed that he had been selling vegetables without a license). Whilst this seems an extreme response to unwarranted police rule, the Tunisian people have been driven to desperate actions due to, amongst other things, a crisis of unemployment. Job opportunities in Tunisia have been slashed due to structural reforms and the country's free-market policies.

Much of the world has been protected from the inequalities in Tunisia. The popular tourism destination reported a total of $US 3 million receipts in 2010. It possesses a pleasant Mediterranean climate, beautiful beaches and historic architecture. So, with tourists fleeing and incoming flights being cancelled for the foreseeable future (the Foreign Office advises against anything other than essential travel) will the riots bring more or less opportunities?

Whilst real growth has slowed in Tunisia over recent years due to a decrease in European import demand, in general the economy has proved to be stable. World Bank recently predicted a GDP rise of 4.8% for 2011, but this now seems less likely.
 

Obviously this is not the first time that a tourism destination has been hit by internal conflict. The riots in Greece last year saw costly widespread damages and business relocations. And the adverse effects of the LA riots back in 1992 amounted to nearly US$4 billion. Any signs of violence also lead to an increase in the risk rating which influences lower rates.
 

However, in 2009, it was forecast that the Thai tourism market would shed 200,000 jobs following street battles in Bangkok – having an almost immediate impact on the property industry. But the withdrawal of the transfer fee, stamp duty and business tax exemptions helped to see property prices in Bangkok increase during 2010 and tourism receipts continue to rise.
 

It does indeed seem that the promise of sunshine is a good remedy for the fright of domestic unrest but any negative factors in such a competitive market cannot be overlooked. Tunisia’s ultimate strength may be in the spirit of its citizens who are certainly gathering much international support. President Obama states “I applaud the courage and dignity of the Tunisian people. [I urge] the Tunisian government to respect human rights, and to hold free and fair elections in the near future that reflect the true will and aspirations of the Tunisian people” He continues by saying “I have no doubt that Tunisia's future will be brighter if it is guided by the voices of the Tunisian people.”



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