European Bank Provides New Funds for Olive Growing and Irrigation Projects in Tunisia

Tunisian olive oil con­firmed its piv­otal role among the coun­try’s agri­cul­tural prod­ucts in 2021.

Despite a dimin­ished har­vest, olive oil still con­sti­tutes 37 per­cent of all food and agri­cul­tural exports.

According to the newly released fig­ures of the National Institute of Statistics, Tunisia exported 198,400 tons of olive oil in 2021, down from the 386,900 tons of 2020.

While the reduced vol­umes affected over­all export value, which dropped 26 per­cent, the National Observatory on Agriculture (ONAGRI) noted that olive oil price per kilo­gram sky­rock­eted 45 per­cent in 202, com­pared with the pre­vi­ous year, to Tunisian Dinar (TND) 8.62 equal to €2.63.

In 2021, thanks to ongo­ing bureau­cracy reforms and inter­na­tional invest­ments, Tunisian olive oil pro­duc­ers and bot­tlers are fore­casted to dou­ble their olive oil exports in the next five years.

Along with ris­ing exports, olive oil qual­ity in Tunisia has also increased in recent years, with pro­duc­ers earn­ing record-high num­bers of awards at the NYIOOC World Olive Oil Competition in each of the last four years.

Among the rea­sons for Tunisia’s increas­ing influ­ence in the global olive oil sec­tor are inter­na­tional invest­ments and sup­port that have helped spread olive grow­ing in the coun­try and adopt mod­ern farm­ing tech­niques and machin­ery.

In recent weeks, the European Bank for Reconstruction and Development (EBRD) has con­firmed a new €6.2 mil­lion loan to the Compagnie Générale des Industries Alimentaires (COGIA) to help strengthen the olive farm­ing sec­tor in the coun­try.

COGIA, one of the country’s major food man­u­fac­tur­ers, will use those funds to fos­ter pro­duc­tion, bot­tling and exports. In sup­port of the coun­try’s exports, there have been six EBRD-funded projects for olive grow­ing in Tunisia since 2017.

Since the start of its oper­a­tions in Tunisia in 2012, the EBRD con­firmed that it has invested more than €1.3 bil­lion in 55 projects in the coun­try.

On top of the funds directed to local farm­ing, the EBRD has also approved a €49 mil­lion loan to the Tunisian Ministry of Agriculture, Hydraulic Resources and Fisheries des­tined to improve access to irri­ga­tion waters for more than 6,800 farm­ers and their fam­i­lies.

Those funds will help rein­state deep wells and age­ing water infra­struc­tures in south­ern regions such as Gabès, Gafsa, Kebili and Tozeur whose almost 40 oases are ​“the pri­mary source of employ­ment and income in the region, with irri­gated agri­cul­ture pro­vid­ing jobs to 35 per­cent of the work­ing pop­u­la­tion,” the EBRD wrote in a press note.

The EBRD project will fol­low the path of the strate­gic devel­op­ment plans announced by Tunisia for sus­tain­able water man­age­ment in the south­ern regions.

The mod­ern­iza­tion of the infra­struc­tures, ​“will also address the deple­tion of non-renew­able ground­wa­ter resources through the devel­op­ment of a long-term sus­tain­able strat­egy to address the water scarcity in the region, as well as a train­ing pro­gram for farm­ers to pro­mote more sus­tain­able agri­cul­tural prac­tices and water man­age­ment and iden­tify alter­na­tive income sources.”

According to the pres­i­dent of the Tunisian Union of Agriculture and Fisheries, Abdelmajid Ezzar, more should be done to ensure Tunisian olive oil prices reflect the high qual­ity of the local prod­uct.

He added that Tunisian olive oil was sold on the inter­na­tional mar­kets in 2021 at a price around €1.75, way less than Italian olive oil, which often fared above €3.50.

Most Tunisian olive oil exports are des­tined for the European Union as part of the duty-free quota of 56,700 tons. The 27-mem­ber bloc is also among the main spon­sors of the EBRD itself and some within E.U. have begun ask­ing for a review of the cur­rent approach.

“Tunisia is one of those coun­tries where olive farm­ing has seen a steady growth in recent years,” Massimiliano Giansanti, the pres­i­dent of the Italian national farm­ing orga­ni­za­tion Confagricoltura, told Olive Oil Times.

“Its olive grow­ing sur­face reaches 20 per­cent of the whole ter­ri­tory, and its pro­duc­tion is now close to six per­cent of global yields,” he added. ​“Olive grow­ing is one of the most rel­e­vant agri­cul­tural activ­i­ties and it exerts a piv­otal role for its socio-cul­tural ram­i­fi­ca­tions, fos­ter­ing devel­op­ment and cur­tail­ing depop­u­la­tion in rural areas.”

Giansanti added how the cur­rent E.U. mea­sures to sus­tain Tunisian exports date back to the after­math of the 2015 ter­ror­ist attack in Port El Kantaoui, dur­ing which 38 peo­ple were killed after gun­men opened fire at a pop­u­lar tourist resort. The attacks prompted the European Union to move in sup­port of the coun­try’s econ­omy.

However, some mem­bers of the olive oil sec­tor believe that enough time has passed and con­di­tions have changed.

“Confagricoltura has been active in try­ing to avoid the renewal of the facil­i­tated con­di­tions for Tunisian exports to the European Union,” Giansanti said.

Several politi­cians are also ask­ing the European Commission to inves­ti­gate the mat­ter.

In a recent hear­ing, Raffaele Fitto, pres­i­dent of the Italian ECR-Fratelli d’Italia group, has asked Brussels​“to eval­u­ate poten­tial effects of the adopted mea­sures on the European olive oil sec­tor” and to con­sider ​“a tem­po­rary sus­pen­sion of the agree­ments between E.U. and Tunisia.”

“Tunisia’s sup­port pro­gram for olive grow­ing is not in ques­tion, as well as other E.U. inter­ven­tions for the least devel­oped coun­tries,” added Giansanti, whose asso­ci­a­tion has brought the issue to Italian and European reg­u­la­tors.

“We under­stand the need for the European Union to be sup­port­ive of a coun­try, like Tunisia, weak­ened by ter­ror­ist acts and by polit­i­cal or eco­nomic insta­bil­ity due to inter­nal events,” he said.

“However, we have to eval­u­ate whether the incen­tives for the devel­op­ment of the sup­ply chain can coex­ist with the duties facil­i­ta­tions for Tunisian olive oil exports to the European mar­ket,” Giansanti con­cluded.

• Tunisian National Institute of Statistics
• Onagri
• Tunisie Numerique