The Price of Bilateral Ties: How Euro-Mediterranean Agreements and EPAs Influence African Markets

In Tunisian ports, cranes move to a rhythm set in Brussels. While ships laden with olive oil and textiles depart for the North, the youth on the docks look to that same horizon as their only hope for a future. This is the paradox of the Mediterranean: a sea that connects two worlds in trade, but separates them in dignity.

For decades, Tunisia has relied on its association agreement with the European Union to secure preferential trade access, attract investment, and coordinate on economic and migration management. The EU absorbs roughly 70% of Tunisia’s exports, providing critical market stability. Yet despite this lifeline, Tunisia faces persistent economic, social, and governance challenges that have limited its ability to fully benefit from the partnership.

Tunisia President has recently called for a review of the EU agreement, citing imbalances in logistics, migration, and investment. At the same time, Tunisia’s domestic environment (political instability since 2011, bureaucratic inefficiencies, and slow structural reforms) has constrained foreign investment and limited economic diversification. The 2025 Finance Law, a homegrown move toward self-reliance, reflects Tunisia’s response to stalled EU and IMF negotiations and marks a strategic pivot toward financial and economic independence.

Both Economic Partnership Agreements or “EPAs” (such as the EU‑Southern African Development Community EPA, the EPA with Côte d’Ivoire, Ghana and Kenya and the EU‑Eastern and Southern Africa EPA) and Euro‑Mediterranean Association Agreements with North African countries (like Egypt, Morocco, Algeria, and Tunisia) tie African countries directly to the EU. These agreements provide predictable access to high‑value European markets, yet they also involve trade‑offs in how African economies prioritise their trade and development strategies:

• Market Fragmentation: by prioritizing European markets, these agreements incentivize African countries to trade more with Europe than with each other, a trend reinforced by poor infrastructure and overlapping regional trade blocs.
• Investment Constraints: trade agreements alone cannot generate substantial foreign investment unless paired with comprehensive domestic reforms (such as legal transparency, streamlined bureaucracy, etc.). In many African countries, including Tunisia, persistent governance weaknesses, regulatory bottlenecks, and political instability limit the effectiveness of these agreements, preventing them from translating into meaningful investment flows despite preferential market access.
• Industrial Policy Limitations: Many African countries, including Tunisia, remain concentrated in low-value-added assembly and production. Trade agreements establish frameworks aimed at promoting the development of more value-added sectors, but without strategic national policies, industrial upgrading, and structural reforms, countries are unable to move into these areas such as manufacturing, processing, or knowledge-intensive industries. Addressing these internal limitations is essential for fully leveraging external trade opportunities and capturing long-term economic gains.

Migration: Brain Drain, Remittances, and Talent Partnerships

In the case of Tunisia, as for most North African countries, migration remains a central challenge. Tunisia has roughly 1.5 million nationals abroad, with remittances accounting for about 5% of GDP. While these funds represent a significant share of these economies, they coexist with a “silent migration” of highly skilled professionals: doctors, engineers, and IT specialistsm who could help drive domestic development.

The paradox is striking: Europe invests to keep irregular migrants out, while simultaneously benefiting from North African skilled labor exported abroad. The way forward may lie in “Talent Partnerships”, circular migration agreements in which the EU funds vocational training and legal labor pathways in Tunisia, creating mutual benefits and reducing brain drain.

AfCFTA: Proof of Concept, Not a Panacea

Regional integration offers opportunities, but it is not a silver bullet. Poor transport infrastructure, high shipping costs, and competitive overlap with other African economies make intra-African trade challenging. Yet by late 2025, Tunisia became one of the top performers in the AfCFTA Guided Trade Initiative, with over 40 companies exporting chemicals and processed foods to sub-Saharan Africa, providing a tangible example that regional integration can complement EU trade rather than replace it.

The Security-Development Nexus

Migration, trade, and security are deeply interconnected. When Europe emphasizes border security over economic development, it inadvertently exacerbates the economic pressures driving migration, creating in the end a self-defeating cycle. By contrast, investments that promote industrialization, job creation, and regional value chains can stabilize communities, reduce irregular migration, and strengthen mutually beneficial partnerships.

Pivot to Non-European Partners

As relations with the EU face strain, Tunisia has expanded engagement with non-European partners, particularly China and BRICS countries, seeking to diversify investment and strategic partnerships. This hedge strategy reflects the limitations of depending on a single dominant market and demonstrates Tunisia’s (and by extension, African nations’) agency in shaping its economic future. Tunisia’s experience underscores the need for a dual approach:

1. Internal reforms: strengthen governance, legal transparency, labor laws, and industrial R&D to maximize both EU and regional trade benefits.
2. Strategic engagement: Continue EU relations while on the other hand working on the creation of intra-African value chains via AfCFTA, complemented by partnerships with non-European actors.
3. Trade agreements alone cannot determine outcomes: success depends on domestic policy, political stability, and institutional capacity.

Conclusion

Tunisia’s case illustrates that bilateral Euro-Mediterranean and EPA agreements are both a lifeline and a set of constraints. They provide critical market access. But cannot substitute for robust domestic reforms or regional integration.

The key lesson is that while Europe structures its bilateral agreements, Tunisia and other African markets navigate between dependence and opportunity: balancing EU markets, AfCFTA potential, skilled migration, and new partnerships with global actors. True sustainable growth will come when they will leverage both internal reforms and external opportunities to transform these complex trade ties into mutually beneficial, resilient strategies.