The ousting of former president Zine El Abidine Ben Ali will improve the investment climate in Tunisia and offset losses caused by the revolt against him, said Banque de Tunisie’s Chief Executive Officer Mohamed Habib Ben Saad.
“The family’s departure will encourage investors a great deal,” Ben Saad said in a reference to Ben Ali’s relatives. “Some investors had been reluctant to develop businesses, as they dreaded that the family would take it in full or in part if it flourished,” he added in an interview in Tunis yesterday.
The central bank appointed Ben Saad last week to manage the North African nation’s second-largest bank by market capitalization, replacing Alia Abdallah, the wife of a former minister close to Ben Ali. The transitional government that took over from the toppled leader ordered a freeze on his assets and on those of his relatives.
Tunisia’s bourse regulator blocked trading in shares representing a 13 percent stake in the bank held by Belhassen Trabelsi, the brother of Ben Ali’s wife Leila. “The remaining 87 percent is free, sound and trading,” said Ben Saad, who expects the government to take possession of Trabelsi’s stake.
The bank’s investments in ventures owned partly by Ben Ali’s relatives such as Carthage Cement, a sugar refinery in the northern city of Bizerte, and car dealership Alpha Ford, are all “sound,” Ben Saad said. “The factories are there, the cars are there.”
Central Bank Governor Mustapha Nabli yesterday told CNN that businesses previously controlled by Ben Ali’s relatives will be preserved because they provide jobs and generate export revenue. The family will not be allowed to interfere in their management, Nabli said.
Banque de Tunisie’s shares lost 19 percent this year, falling to a 52-week low of 9.4 dinars ($6.7) today, on the second day of trading in Tunis after a two-week halt. They traded at 11.89 dinars on Dec. 17, when Mohamed Bouazizi, a street vendor in the central town of Sidi Bouzid, set himself on fire to protest the confiscation of his wares and the humiliation inflicted on him by a municipal official, sparking the revolt against Ben Ali’s 23-year rule.
Ben Ali fled to Saudi Arabia on Jan. 14, after the army refused to confront protesters. Prime Minister Mohamed Ghannouchi, who also served under Ben Ali, leads a transitional government that plans within six months to hold the first free elections since Tunisia’s independence from France in 1956.
Moody’s Investors Service downgraded ratings for the local- and foreign-currency deposits of five Tunisian lenders by one notch each on Jan. 21, citing concern that the unrest might affect the economy and credit conditions.
The ratings service gave Banque Internationale Arabe de Tunisie and Banque de Tunisie, the two biggest lenders by market value, the lowest rating in the investment grade category, Baa3. The move followed a similar downgrade of the government bonds rating to Baa3 on Jan. 13.
Banque de Tunisie is assessing losses that the protests caused for its commercial borrowers and will make provisions accordingly, said Ben Saad.
The revolt caused about 900 million dinars ($640 million) in damage to businesses, Assabah reported today, citing Abdellatif Chaabane, the chairman of Comite General des Assurances, the state body that regulates insurers. Insurance companies don’t fully cover damage caused by civil unrest and are expected to cover about a quarter of the cost, he said.
Fitch Ratings on Jan. 27 said Tunisia’s economy would grow 2 percent in 2011, compared with a government forecast of 5.4 percent, announced in November.
“This is temporary,” said Ben Saad, commenting on the ratings downgrades. “Democracy will free energies, it will free investments, it will free hope, and that will do a lot of good for employment and for the economy.”
To contact the reporter on this story: Maher Chmaytelli in Tunis at firstname.lastname@example.org
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