The concept. Once again, the Forum promises to be original and innovative, so as to make the most of the participants presence.

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2 The concept The concept of the Carthage Investment Forum was developed in 1999 in response to international demand for detailed information on Tunisia. Furthermore,ten years of dynamic economic activity based on the goal of a knowledgebased economy for Tunisia that can generate growth and jobs for young graduates created new opportunities for partnership that are worth being shared with an international audience that is closely following the emergence of Tunisia as a platform for export. On the international scale, reports by the various specialized instances involved in monitoring and analyzing capital flows all agree that foreign direct investment is no longer limited to cost considerations in choosing a site for setting up a business or externalizing related services, but is now also affected by other constantly-changing requirements. The Carthage Investment Forum puts itself forward as a vector for communication and better visibility of what Tunisia has to offer, which can meet increasingly complex foreign demand. Right from the start, the Forum adopted a simple formula that is quite original, choosing a theme of high interest each year and a target audience. Called on to come up with something new every year, the organizers of the Forum are pleased to see that this event has a higher than average return rate for this type of international economic event. The Carthage Investment Forum is truly a crossroads where the most dynamic economic operators, decision makers seeking innovative solutions, and the most concerned experts and officials gather to discuss a theme and to hold B2B (business to business) meetings based on common interests. Every year hundreds of profesionals involved in the economic scene in their respective countries gather in Tunis along with the local and foreign specialized press, providing the Forum with a critical mass that is making it the key economic meeting on the southern rim of the Mediterranean. However, this is not enough to let organizers rest on their laurels. Each new session of the Carthage Investment Forum is a new challenge to be met, confident of success and yet imbued with a commitment to innovate and to master every detail. Theme, place, date, participants and objectives have all been chosen with the same rigor as from the outset of the Forum. The watchword remains: anticipate expectations in order to meet them. This year, the carthage investment forum will focus on two major themes, which are industrial internationalization and services outsourcing. These themes are meant to be in continuity with the 2006 forum central theme that focused on Tunisian ability to move up the economic value chain as well as the consolidation of knowledge-based economy nationwide. Once again, the Forum promises to be original and innovative, so as to make the most of the participants presence.

3 Themes The Carthage Investment Forum, organized every year by FIPA-Tunisia under the auspices of the Ministry of Development and International Development, will be held this year on June at the El Mouradi Gammarth Hotel in the northern suburbs of Tunis, some 15 kilometers from the capital s city center and 10 minutes from the picturesque village of Sidi Bou Said and the Carthage archeological sites. This ninth session of the Forum will bring together Tunisian and foreign decision makers and economic operators with an interest in new investment opportunities and the factors of attractiveness in sectors likely to undergo strong development in Tunisia and worldwide. They will discuss two major themes («industrial internationalization» and «outsourcing of services»).these themes are meant to be in continuity with the 2006 Forum central theme that focused on Tunisian ability to move up the economic value chain as well as the consolidation of knowledge based economy nationwide. This upgrading, addressed in the report of the Davos World Economic Forum on global competitiveness, has led to industrial companies working in Tunisia at a higher level in the chain of value. In sectors as demanding as mechanical/electrical/electronic or technical plastic industries, there are more and more companies working exclusively with Tunisian staff to turn out finished products in full conformity with international standards of quality. Those interested in FDI on the international scale readily agree that Tunisia has moved from a low-cost site to one that competes well on the basis of other factors. On the basis of these new prospects, the organizers have decided to provide an opportunity to learn more about what Tunisia has to offer in the area of industrial internationalization, in the form of a panel devoted to this theme. The second panel will be devoted to outsourcing of services, a worldwide phenomenon increasingly characterized by internationalization strategies by firms that needed to focus restructuring on their core skills and to outsource related service activities. Tunisia s successful experience with international call centers using local staff is widely recognized and the country hopes to put its advantages to use in high added value areas such as basic technical support services, engineering, and R&D activities. Thanks to the availability on the market of young skilled engineers who are industrious and trilingual, Tunisia has the means to reach its goals. The Tunisian Government has committed to modernizing telecommunications infrastructure. The ICT sector today accounts for some 20% of services and the share of services in economic growth is currently 62%, expected to go to 67% over the period Experts will intervene in these two panels and company heads will give testimonials about successful experiences in this area. There will also be Networking sessions at the Forum, which will help optimize participation in this event, which is quite possibly the key economic event on the southern rim of the Mediterranean, given the massive participation of national and international medias at the previous sessions and the growing number of participants. Furthermore, the International Car Show of Tunis (SIAT) will be held at the same time as the Forum, which will serve as a catalyst for the event.

4 Program June , at 5:30 pm Opening ceremony Presentation of the study on a knowledge-based society and Tunisia s attractiveness in promising sectors Cocktails and buffet June :00 11:00 am Panel I Industrial internationalization: Tunisia, a reliable partner in the value chain Moderator: Dr. Hans-Peter MERZ Chamber of Commerce and Industry of Bochum Guest of honor Mr. Afif CHELBI, Minister of Industry, Energy and Small/Medium Size Companies Introduction of the panel: new trends in internationalization of industrial production - What Tunisia has to offer in industrial internationalization - Tunisia s advantages for favorable positioning in internationalization - Young, skilled human resources - Mastering technical processes - Legal and regulatory framework - Appropriate infrastructure Debate Rundown and recommendations 11:00 11:30 am Coffee break 11:30 am 1:30 pm Services outsourcing: Tunisia, an emerging platform Panel II Moderator: Armand ANGELI European Outsourcing Association Guest of honor Mr. Montassar OUAILI, Minister of Communication Technologies Introduction of the panel: determining factors and outsourcing of services throughout the world Tunisia s assets in services outsourcing - Telecom infrastructure - Human resources - Regulatory aspects Services outsourcing in Tunisia - Call centers - Shared services centers - Research and development units Debate Rundown and recommendations 1:30 3 pm Lunch 3:00 6:00 pm Networking June A guided tour of the Zarzis economic activity park is being set up for 23 June Please sign up now if you would like to take advantage of this opportunity. All expenses (travel and lunch) will be covered by the organizer.

5 PANEL I: Industrial internationalization Internationalization of firms is increasingly characterized by a growing fragmentation of industrial production processes. Lower transport costs and progress in new information and communication technologies have allowed for remote management of manufacturing. Fragmentation has spread around the world and companies can choose their partners from among the most competitive offers. The logic of parceling out industrial production leads quite naturally to interest in the phenomenon of international sub-contracting. With manufacturing techniques becoming more and more specialized, industrial sub-contractors are becoming the only solution. They are in effect capable of responding to requests that are at times contradictory: to design increasingly complex products in ever shorter periods of time at competitive prices. Even if international sub-contracting has been around for some time in consumer goods industries like textiles/clothing and electrical/electronic, it also extends to other industrial activities such as mechanical and aeronautical industries. Companies have gone back to concentrating on their core activities, preferring to turn to the market for goods where their competitive advantage is weak. Aside from the goal of reducing or keeping down costs, companies that turn to international subcontracting also want to secure the best skills in areas where they themselves are deficient. Capacity for quick apprenticeship of skilled human resources, a competitive industrial set up, and infrastructure corresponding to the requirements of industrial internationalization have helped Tunisia integrate its production processes and attract first-rate subcontractors, putting into play its advantages especially in electrical/electronic, mechanical and plastic industries. Total annual wage costs for an engineer in euros Tunisia Rumania Morocco Hungary Czech Republic Poland Turkey Italy Spain France Germany Source: ECORYS-NEI and Business Mobility International, March 2004 Furthermore, production of components with high technological content shows that Tunisia can manufacture parts and equipment that require a high degree of technicity. This is the case for automotive components with the presence of top-notch international manufacturers. This is also the case for the aeronautical sector, with growing activity in Tunisia thanks to the presence of major sub-contractors of Boeing and Airbus and development of precision mechanics.

6 PANEL II: Outsourcing of services Although this is not a new phenomenon, externalization or outsourcing of services is attracting growing interest among businesses. By allowing a company to focus on its main activity and externalize various related services to other companies that can supply them at low cost and more profitably, outsourcing of services will undergo strong international development over the next few years. Outsourcing in Europe, the Middle East and Africa from 2003 to 2009 (in billion dollars) Year Turnover for outsourcing (P) (P) (P) (P) 86.1 Source: Gartner Consulting, April 2006 The phenomenon of internationalization of services, which helps to be less dependent on a given geographic space, involves companies that supply services to (or that can be sold to) a number of the parent company s units. In some cases, affiliates provide services to just one client that is part of the parent company. In other cases, this internationalization involves companies that serve clients outside the group. New information and communication technologies have helped these companies set up business in emerging countries. New ICTs will in effect help companies climb the chain of values with a view to increasing competitiveness and subdividing services with a high information coefficient into a number of constituent elements. The company does not invest abroad just to secure direct production or the services it selles. The externalization or offshoring allows it to set up functions more known under tertiary support in developing countries with lower cost. Tunisia has managed to attract this kind of foreign direct investment (FDI), combining factor costs with skilled human resources. Outsourced services include, in ascending order in the chain of values: call centers, data processing, marketing by phone, and technical support services, processing of financial transactions, as well as R&D and engineering services. It is the outsourcing of services and its corollary offshoring where Tunisia has certain competitive advantages and this will be the theme of the second panel. Building on the successful experience of hosting the second phase of the World Summit on the Information Society in 2005, when Tunisia s many advantages in internationalization of services related to new ICTs were on display, Tunisia hopes to become a top rate platform for such activities, which have strong potential for growth.

7 Tunisia as perceived by foreign operators «It was in 2001 in Boston that the decision was made for the first time to set up business outside of the United States. The choice of Tunisia was based largely on the country s commitment to a knowledge based economy and an educational system that uses the latest technologies. In 2002 we were already operational. Our sole client originally was General Electric, but we now have five major clients in the aeronautical industry. Incentives, modern infrastructure, and the availability of well trained, low cost manpower are all factors that played a key role in favor of significant development in such a short time. Staff intelligence and strict compliance to norms of quality have helped companies attain a nil rate of complaints. Personally, I have no regrets about leaving California, since this small Mediterranean country provides all the facilities of modern life in a climate of warm hospitality on the part of the Tunisian people.» Thomas Wendt, Director General of Eurocast, Megrine (Tunisia) 20 April 2007 «The IMTEC Group is present on four continents and we think that setting up business in Tunisia is altogether logical, especially since the main principals of the automobile industry are represented here. Tunisia s intrinsic value compared to similar countries provides the framework for smooth operations. I would say that this is a stable country but also a sound one where we can adopt a long term strategy, which is not the case for other countries. We are starting to take advantage of an overall industrial set up with capacity for quickly understanding technological issues, thus facilitating development of technical products. Technologically complex plastic automotive parts are easily mastered thanks to the adaptability of our 100% Tunisian staff and we are expanding our range of products and gaining the confidence of new clients. It should be noted that the combination of European know how and typical Tunisian skills have helped out lines of technical plastic parts to attain international standing in just six years, compared to some 40 years in a number of other countries». Thierry Le Marois, Director General, Sidi Rzig (Tunisia) 20 April 2007 «In Tunisia we have found engineers, technicians, managers and supervisors as well as operators with sound basic training, able to quickly assimilate the group s specialized work and the technical processes specific to our activity.the absentee rate is twice as low as the average for European countries and thanks to our staff s sense of responsibility and ability to adapt (flexibility in carrying out tasks and multiple skills), the group has decided to expand activities and pursue international development with Tunisia as a base. Good import-export logistics and wage inflation at a foreseeable 5% are equally important factors that should help our group and Tunisia to remain competitive. Client satisfaction in the aeronautical sector is proof that we are making the right choices.» Gaby Lopez, Director General, Zodiac Automotive Tunisia, Zodiac Equipment Tunisia Soliman (Tunisia), April 2007

8 «The decision to set up business in Tunisia has been taken with a view to being near clients that had already made the move. The warm welcome extended to us, the ease of access to decision makers, the educational and technical level of Tunisian staff and their ability to adapt are encouraging us to develop international activities from a base in Tunisia. This idea is shared by our international clients, who each time that they make an exploratory visit to our plant are impressed by such dedicated and capable staff and by the fact that the added value of a Tunisian engineer is far greater than his or her European counterpart, at very competitive costs. I would recommend to anyone who is considering a move to opt for a country where there are no major impediments to success. Tunisia, just across the Mediterranean, is a formula for success». Ernest Allee, Site Director, Lacroix Electronics Tunisia Zriba (Tunisia), April 2007

9 Tunisia in world rankings The most competitive country in Africa and the Arab world Tunisia has gained seven places in the ranking established by the Davos World Economic Forum (WEF), according to the global competitiveness index (GCI), up from 37 th to 30 th place. The report notes that Tunisia has benefited from «significant institutional advances» to become the leading African (South Africa 45 th, Morocco70 th, Algeria 76 th ) and Arab (UAE 32 nd, Qatar 38 th, Kuwait 44 th, Jordan 52 nd, Egypt 63 rd ) country in terms of competitiveness, well ahead of some 20 countries in the euro zone (Portugal 34 th, Malta 39 th, Hungary 41 st, Italy 42 nd, Greece 47 th, Poland 48 th and Turkey 59 th ). This ranking is based on a combination of raw data available to the public at large and the results of the Executive Opinion Survey, an exhaustive yearly study carried out by the World Economic Forum in collaboration with its network of institutional partners. This year more than 11,000 heads of companies were surveyed in 125 countries. The questionnaire submitted to them covers a wide range of factors that affect conditions and that are all determining factors for sustainable economic growth. The 2006 report contains a detailed economic profile for each of the 125 economies reviewed, summarizing the country s ranking according to the index and giving its most striking competitive strong and weak points. It also has an entire section with tables, with international rankings made on the basis of more than a hundred indicators. The new report places Switzerland, Finland and Sweden as having the most competitive economies in the world. Denmark, Singapore, the United States, Japan, Germany, Holland and the United Kingdom complete the list of the top 10. Source: weforum.org Tunisia, the most peaceful country in Africa According to the Economist Intelligence Unit recent report, the results of which were made public on Wednesday May 30 th in London, Tunisia is one of the most peaceable and stable countries in the world. Ranked 39 th, Tunisia has the highest ranking in Africa and it is in fourth place among Arab countries, after Oman (22 nd ), Qatar (30 th ) and the UAE (38 th ). With 1762 points, Tunisia is ahead of the United Kingdom, ranked 49th with 1898 points. Countries in the same category as Tunisia include Australia (1664 points), Italy (1724 points), France (1729 points) and Malaysia (1744 points). Norway is in first place as the most peaceful and stable country with 1357 points, followed by New Zealand (1363 points) and Denmark (1377 points). The United States is ranked 96 th and Russia 118 th. Algeria is in 107 th place with 2503 points, Morocco is 48 th, and Libya is 58 th. The report is based on an analysis of conditions relating to peacefulness and stability in 121 countries around the world, based on a number of criteria such as how well democracy works, the degree of security for foreigners, the level of corruption, government effectiveness, cohesion and integration within the population, relations with the international community, investment climate, countries implication in armed conflicts, and the level of military expenditure. Source: visionofhumanity.com

10 A country where it is easy to do business The fourth annual report of the World Bank and the International Financial Corporation (IFC) «Doing business: how to bring about reform» was made public on Wednesday 6 September At the top of the list of countries where it is «easy to do business», Tunisia comes in 4 th in Africa and 6th in the Arab world. The report mentions the fact that Tunisia has managed to improve investor protection by giving stockholders access to corporate books, by increasing the responsibility of auditors and prohibiting companies from granting loans to their representatives. The report dealing with the legal environment for businesses in 175 countries around the world (20 more than in the previous report) is the result of efforts by more than 5000 experts working on the 10 indicators that make up the ease of doing business index, constituting a reference for governments and rating agencies. Source: worldbank.org Ahead of Greece and Poland in the area of economic liberalization The much anticipated «2007 economic liberty index» was announced last 17 January in Hong Kong by its two publishers: the Heritage Foundation and the Wall Street Journal. Although there were no surprises at the top of the list, the middle of the list contained several surprises for investors, with Tunisia ahead of certain Gulf countries and members of the European Union. The 2007 report analyzed economic freedom in 161 countries on the basis of factors ranging from freedom of investment and commerce to job flexibility. Country Ranking Hong Kong 1 Singapore 2 Australia 3 Tunisia 69 Qatar 72 United Arab Emirates 74 Turkey 83 Poland 87 Greece 94 Morocco 96 Egypt 127 Libya 155 Source: the 2007 Index of Economic Freedom

11 Ahead of Italy, Greece and Poland in the area of ICT Tunisia is ranked 35 th in the world in the Davos world report on information technology issued 28 March 2007, first in the Maghreb and in Africa, out of a total of 122 countries. Presented in Geneva, this report establishes its ranking on the basis of three major elements:the country s political and economic environment, the technological development level and the degree to which ICT is actually used. Tunisia is ahead of European countries like Italy, Greece, Cyprus, Poland and Asian countries like China and India. Tunisia is ranked fourth in terms of Governmental success in promoting new ICT, 6th in he priority given to ICT in governmental strategy, 12th in the speed at which new businesses in this sector can be set, and 14th in terms of the quality of public education. Tunisia is 30th in terms of protection of intellectual property and 32nd in school access to internet. Source: World Economic Forum Tunisia leads Rumania and Morocco in the area of offshoring Tunisia is in 26 th place in the latest ''Global Services Locations'' index published in March by the consulting firm A.T. Kearney, ahead of Canada, Spain and Morocco. India continues in first place for activities related to services and offshoring. Rank Country Financial attractiveness * Quality of human resources Business environment 1 India Malaysia Singapore USA Tunisia South Africa Rumania Canada Morocco France Source: AT Kearney s 2007 Global Services Location Index (March 2007) *: measures attractiveness in terms of factor costs as well as tax and financial incentives

12 Tunisia has proved its attractiveness as an investment site Near to Europe, politically and socially stable and with highly skilled manpower, Tunisia has many economic advantages. Open to the outside world, 50% of Tunisia s gross domestic product is generated by exports and it is the leader in Africa and the Arab world in terms of economic competitiveness, according to the World Economic Forum. Tunisia opted very early on for development of a market economy and gradual integration in the world economy. This economic commitment has helped improve the private sector s ability to adapt and to diversify its industrial base. In this context, Tunisia was the first country on the southern rim of the Mediterranean to sign an agreement with the European Union (in 1995) to introduce a free trade zone between the two parties on 1 January Over the past five years, Tunisia s GDP has risen by 5% on average per annum, despite more intense international competition and soaring oil prices thanks to favorable development of services, including telecommunications and new technologies. Tunisian authorities are counting on 6% GDP growth in This growth dynamic was led by ongoing investment by Tunisian authorities since independence in education and a commitment to building a knowledge-based economy capable of meeting the challenges of the future. The financial system has been the object of several reforms targeting restructuring of the financial situation at banks and insurance companies and diversification in the supply of financial products to economic operators.thanks to prudent monetary policy by the Central Bank of Tunisia (BCT), the inflation rate has fallen from 6.3% in 1995 to about 4% now. External debt has been kept down and has never had to be rescheduled. Prudent policy by authorities has thus helped to anchor the components of Tunisia s world-renowned macro-economic stability. Thanks to its policy of commercial opening, Tunisia is characterized by dynamic exports, growing reduction of the trade deficit, and diversification of the export base. In 2006, the volume of trade amounted to more than 35 billion Tunisian dinars, an increase of almost 13% over the previous year s figure despite difficult international conditions. Even if most of Tunisia s trade is conducted with the EU (70% of Tunisia s imports come from the EU, which is the destination for 80% of Tunisia s exports), current trends involve diversification of Tunisia s trading partners thanks to introduction of a number of free trade agreements, especially bilateral agreements with Arab, African and European countries, the Arab free trade agreement, and EFTA. This favorable macro-economic environment and introduction of significantly attractive incentives have helped Tunisia secure more and more foreign direct investment in various sectors such as mechanical/electrical/electronic, agrofood, plastic, textile/clothing and service industries. Today more than 2800 foreign or mixed companies working in Tunisia provide almost 275,000 jobs. 72% of these companies export their entire production. FDI represents 15.8% of productive investments, generating one third of exports and a sixth of all jobs. From 1990 to 2006, foreign direct investment (FDI) increased from 78 million dinars to some 1431 million dinars (3% of GDP). More than 24% of funds were invested in manufacturing industries, 66% in energy, 10% in services (including 1.3% in tourism and real estate) and 1% in agricultural activities. FDI comes mainly from the EU, the United States, and Arab Gulf countries.

13 FDI in Tunisia over the period Foreign investment flows for the period came to million dinars, an average of 1689 MTD per year compared to averages of 733 MTD for the period and 494 MTD for the period For the period , 912 new companies with foreign holdings were set up and 944 expansion initiatives were carried out. These developments provided 65,000 new jobs, representing 18% of total jobs created nation-wide over this period. As of end 2006, 2803 companies with foreign holdings were working in Tunisia, providing almost 274,000 jobs. This involved various sectors of the economy, mainly high added value manufacturing industries in which Tunisia has competitive advantages, for example aeronautical electrical/electronic components. FDI in services also moved ahead in terms of both quantity and quality, involving activities with high knowledge content. The record level reached in 2006 was due to an exceptional transaction, the partial privatization of Tunisie Telecom (35% of capital for 2.97 billion Tunisian dinars) by investors from the Emirates. Even if income from privatization is excluded, growth in FDI is still very positive ( MTD or +64.6%), as is that of portfolio investment (116 MTD or +60%). FDI flows in 2006 From 2005 to 2006, the overall volume of FDI in Tunisia rose from MTD to MTD. In terms of number of projects implemented, manufacturing industries continued to attract the largest number of foreign investments. There were 378 projects in 2006, of which 163 were new companies, providing 13,518 new jobs. Textiles/clothing enjoyed a considerable increase in the number of new projects, up from 95 in 2005 to 126 in 2006 (71 new companies and 55 expansions). These same trends held for chemical, leather/footwear and miscellaneous industries, with respective growth rates of 100%, 66.7%, 50% and 31.1%.

14 Foreign direct investment in Tunisia Foreign companies in Tunisia Trends in the number of foreign companies working in Tunisia ( ) FIPA Tunisia-2006 Trends in foreign investments In million TND 4518, ,70 718, ,10 788,5 858,5 1088, Central bank of Tunisia